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