CRON Stock Forecast: Is Cronos Stock Ready for a Rebound?

cron stock forecast
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CRON Stock Forecast

Few pot stocks have been as unpredictable as Cronos stock.

Cronos Group Inc (NASDAQ:CRON) has at times been the darling of the marijuana industry, especially when it first announced that it would list on the Nasdaq.

But it has spent just as much—if not more—time struggling to make sustainable gains in a volatile marijuana market.

When it comes to the CRON stock forecast, it’s hard to predict just where the company will go.

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While there is certainly a lot of potential contained within Cronos stock, there are simply too many variables surrounding the future success of the company on the marijuana stock market.

Consider Cronos Group’s most recent quarterly report. Some of the company’s first-quarter numbers are stellar.

Cronos saw sales jump to CA$2.9 million, up about 473% compared to a year prior. From the last quarter, sales are up about 83%. (Source: “Cronos Group Inc. Announces First Quarter 2018 Results,” Cision, May 15, 2018.)

Those are very strong numbers that most companies would love to see in their financial reports. After all, if there’s one thing that investors look for, it’s growth. And Cronos stock has that in spades.

Chart courtesy of StockCharts.com

The problem, however, is that even this exponential growth isn’t enough to keep up with the sky-high market cap that CRON stock has acquired.

While the company showed a net loss per share during the first quarter, that’s not unexpected for a rapidly growing company.

Cronos stock found itself facing the same problem that’s been dogging it for months now: to some analysts, the company is overvalued.

Depending on how you slice the numbers, you’ll come up with different conclusions. However, most traditional methods (like looking at the price-to-earnings ratio) will show that CRON stock is indeed one of the more overpriced stocks around.

But here’s where the potential comes in.

The company has made inroads in the Australian market, as well as partnered with MedMen Enterprises Inc. (CSE:MMEN), an American company.

I’ve long maintained that internationally focused marijuana companies are the ones most likely to thrive in the long term.

It would appear that, while the immediate aftermath of the Q1 report led to a fall in Cronos stock prices, the stock may once again be coming back into favor. Its price has risen by almost 20% in the past month.

But I don’t expect those gains to be long-lasting, and would caution investors that Cronos Group remains one of the riskier plays on the market.

Analyst Take

My CRON stock forecast is a cautious one.

There’s a lot of volatility in the marijuana market these days, and Cronos Group has been one of the most volatile stocks.

While the company has a lot going for it, I believe that its inability to sustain growth so far in 2018 makes it one of the riskier picks going forward.