Over the past year, Cronos Group Inc (NASDAQ: CRON) has been an incredibly interesting stock to watch. While there have been peaks and there have been valleys, the stock has seen tremendous growth, gaining almost three times in value. However, if you think that you’ve missed the boat, think again. This stock has more room to run. Today, we’ll talk about:
- Why we’ve seen such incredible growth out of CRON;
- why the stock is likely to see further gains;
- what we’re seeing from the stock in the market today; and
- what we’ll be watching for ahead.
Why We’ve Seen Such Strong Growth Out Of CRON
As mentioned above, Cronos Group has seen some incredible growth over the past year. So, what’s the deal? Why is the stock up? Well, there are several reasons.
First and foremost, Canada recently legalized cannabis for adult use. With Cronos being a cannabis producer and distributor that already had a hold on the medical market in the region, the company was well positioned to take a good portion of the market share on the recreational side of the coin.
In fact, the boost in Canada didn’t just help CRON. There were several stocks, including Canopy Growth (CGC), Tilray (TLRY), Aurora Cannabis (ACB) and others that saw strong gains as the emergence of the cannabis market in Canada took place.
Throughout the process, CRON was incredibly active, announcing several supply agreements for the commercial supply of recreational cannabis as well as several announcements surrounding the growth of the company’s infrastructure.
Recently, things got even better for Cronos and its investors after Altria, a tobacco giant in the United States, made a multi-billion dollar investment to purchase a large chunk of the company. Not only did this investment help the company from a balance sheet perspective, it will likely help in the long run from a regulatory perspective. After all, Altria has plenty of experience working within a highly-regulated market.
Another point to mention is the fact that the Farm Bill passed in the United States. While this bill will not legalize cannabis, it will legalize the plant’s cousin, Hemp. Importantly, this also legalizes cannabidiol, found in both the hemp and cannabis plants. With this in mind, CRON has yet another market that it is well positioned to take advantage of.
Why The Gains Are Far From Over
At the end of the day, I believe that CRON gains are just the tip of the iceberg. First and foremost, earnings season in upon us and investors are eagerly waiting to see the report from the company. That’s because this report will show just how well the company is doing as it takes its position in the emerging Canadian cannabis market.
Beyond the earnings report, CRON has made several announcements with regard to global expansion, and with Altria as a partner, this expansion is likely to happen rapidly. That is especially the case in the United States CBD market. With the entrance into the US market, Cronos will likely produce an incredible run in value for investors.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to work in the market is that the news leads to moves. Over the past year, we’ve seen tons of good news out of Cronos, leading to gains that far outpace the market. These gains are continuing today. As is just about always the case, our partners at Trade Ideas were the first to alert us to the movement. At the moment (10:29), CRON is trading at $20.93 per share after a gain of $1.28 per share or 6.51% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on CRON. In particular, we’re interested in following the story surrounding the company’s continued work to expand its global footprint, increasing value for investors. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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