Stock Wars: Cronos Group Vs. cbdMD

Benzinga’s weekly Stock Wars matches up two leaders in a major sector with the goal of determining which company is the better investment.

This week, the duel is between two companies in the cannabidiol (CBD) space: Cronos Group Inc (NASDAQ: CRON) and cbdMD Inc. (NYSE: YCBD).

The Case For Cronos Group: Founded in 2012 and headquartered in Toronto, Cronos Group promotes itself as “an innovative global cannabinoid company with international production and distribution across five continents,” adding that it has a corporate mission for “building disruptive intellectual property by advancing cannabis research, technology and product development.” Cronos has the financial backing of tobacco giant Altria Group Inc (NYSE: MO), which owns nearly 50% of the Canadian company.


The past six months have been busy for the company with activities including:

• Launch of the first U.S.-based campaign for its Lord Jones brand of hemp-derived CBD-infused products.

• An amended agreement with Ginkgo Bioworks Inc. that will enable the companies to accelerate the commercialization of cultured cannabinoids at scale.

• The acquisition of a 10.5% ownership stake in Chicago-based PharmaCann Inc.

• Launch of a new line of cannabis gummies by its Spinach brand.

• The appointment of former American Eagle Outfitters Inc (NYSE: AEO) executive Bob Madore as its new chief financial officer.

For its most recent earnings report, the second-quarter data published on Aug. 6, Cronos Group reported $15.6 million in revenue, up from $9.8 million one year earlier. The company attributed this increase to its presence in the adult-use Canadian cannabis market and increased sales in the Israeli market.

But the company also reported a gross loss of $15.8 million, up from $2.9 million one year earlier. This decline was attributed to inventory write-downs in its international markets.

Cronos Group’s adjusted EBITDA loss of …

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