- Cronos missed earnings and earnings forecasts for the fourth quarter.
- Shares slid more than 4% on Tuesday morning.
- Watch Cronos Trade Live.
Cronos cannabis maker lost more than 4% early on Tuesday after missing out on Wall Street's fourth-quarter revenue estimate.
Cronos had a business turnover of C $ 5.6 million, which is well below consensus estimates of C $ 10.8 million and below all analysts' estimates. Expectations for the quarter were high, with analysts surveyed by Bloomberg predicting revenue growth of over 500%. The company recorded a loss of $ 0.11 per share for the 2018 fiscal year.
"We have expanded our production footprint nationally and internationally, developed our distribution with global partnerships, launched iconic brands for the Canadian adult use market, and expanded our intellectual property portfolio through leading research and development, "said CEO Mike Gorenstein in the release.
The Cronos group has often been at the forefront of change in the rapidly growing cannabis sector.
The Altria group, a Marlboro cigarette manufacturer, invested $ 1.8 billion in the Cronos group in December 2018, giving it a 45% stake in the cannabis producer. At the current price of Cronos' stock of about 20 dollars, Altria investment in the company has more than doubled.
"Altria is Cronos' ideal partner because it provides the resources and expertise necessary to significantly accelerate our strategic growth," said Mr. Gorenstein at the time of the investment.
In February 2018, Cronos became the first company to grow and sell marijuana at an American stock exchange, opening the door for its publicly traded rivals, Canopy Growth and Aurora Cannabis. The Cronos have already been traded in Canada.
Founded in 2013, Cronos Group owns and operates brands in the marijuana growing and distribution sector. It owns 100% of Peace Naturals and Original BC, which are licensed to grow and sell marijuana for medical purposes.
Cronos has been among the best performing Nasdaq since listing in February 2018, up 181% over the past 12 months. The stock was up 89% this year until Monday.