The euphoric interest in any company connected to the marijuana market is at unsustainable heights. So when Citron, which rarely seems to get bearish calls right, set a $3.50 a share target, the prediction may play out favorably.
Markets assume Cronos Group (TSX: CRON) will get $8.50 a gram, up from $6.53 in the second quarter. Last week’s top at nearly $13 followed-through with the stock closing at $9.88. Yet Cronos’ management is highly competent. It listed the company on the NYSE and was ahead of the competition when it signed a huge deal to supply the U.S. giant’s cannabis oil facility. It unveiled a 50/50 joint venture named NatuEra in Columbia.
Cronos’ global ambitions do not stop there. In June, it announced it had been granted a medicinal cannabis Manufacture License in Australia. In Canada, Cronos has the most distribution chains in Canada compared to any other producer.
Citron’s track record is not great. Other than calling Valeant, now called Bausch Health Companies (TSX: BHC), a sell, the group said Shopify (TSX: SHOP), Roku (NASDAQ: ROKU), Nvidia (NASDAQ: NVDA), and a slew of other stocks were sells, too. The latter stocks are still sharply higher since those bearish calls were made.
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