Could Cronos Group Stock Fall Below Its Cash Value?
Earlier this year, there wasn't a hotter cannabis stock around than Cronos Group (NASDAQ: CRON). The exceptionally popular Canadian grower more than doubled at one point during the first quarter, with the biggest catalyst being an announced equity investment from tobacco giant Altria Group (NYSE: MO). This deal, which closed in mid-March, featured a $1.8 billion cash investment that gave Altria a 45% non-diluted stake in Cronos.
This budding partnership between Cronos and Altria, as well as the serious cash infusion that came with this investment, was expected to be a game changer for Cronos. After all, the company ended 2018 with less than $25 million in cash and cash equivalents on its balance sheet, but had a long to-do list that it wanted to tackle. The $1.8 billion Altria supplied instantly eased Cronos Group's cash concerns and gave it the ability to tackle a number of long-term growth strategies.
Image source: Getty Images.
Source Fool.com
