In a recently released analyst research report, Stifel analyst, W. Andrew Carter, upgraded their rating on shares of Cronos Group Inc. (NASDAQ:CRON) (TSX:CRON) from a hold to a buy with a price target that suggests some decent upside to come.
This comes on the heels of Cronos Group’s announcement of a $20 million AUD IPO of Cronos Australia Ltd.
Under the offering, Cronos Australia Limited is expected to issue 40 million new shares at an offering price of $0.50 per share AUD ahead of its planned listing on the Australian Securities Exchange in November 2019. Established in February 2018, Cronos Australia is a 50-50 joint venture between Cronos Group and NewSouthern Capital Pty Ltd.
W. Andrew Carter’s price target of $14.00 CAD per share implies a potential upside of approximately 26.01% based on the last traded price of $11.11 CAD per share on the TSX.
According to the analyst, “Cronos is unconstrained in its ability to invest towards the $200 billion global opportunity with C$ 2 billion in cash on hand (50% of its market cap) while utilizing the resources of tobacco giant Altria (45% ownership). We believe Cronos will showcase an enhanced revenue growth profile leveraging the distribution capabilities of Altria to build its U.S. CBD business and demonstrate break-through product potential in the Canadian vapor segment. While we are anxious about the Canadian market development particularly risks around the vapor segment, the potential for capitalizing on any sector fallout provides a key avenue for value creation.”
Be sure to subscribe to Cronos Group Inc. stock updates here so you never miss an important Cronos development.
Get Real-Time Updates from MJobserver.com