10 Best Marijuana Stocks To Buy According to Hedge Funds

3. Cronos Group Inc. (NASDAQ:CRON)

Number of Hedge Fund Holders: 13

Ranking at number 3 in our list of the Best Marijuana Stocks is Cronos Group Inc. (NASDAQ:CRON), a Canada-based cannabinoid company engaged in the cultivation, manufacture, and marketing of cannabis and cannabis-derived products for both medical and adult-use markets. A noteworthy aspect of the company is its close association with Altria Group, a giant in the tobacco industry that maintains a 41% stake in Cronos that it acquired in 2019.

Cronos Group Inc. (NASDAQ:CRON)’s revenue increased by a significant 38.8% to reach $34.4 million in Q3 2024. What’s more is that most of this growth came from the company’s increasing market share in Canada, reflecting its sustainable nature. Also, Cronos has managed this growth while reducing operating expenses by $3 million year-over-year (adjusted for non-cash impairments), significantly improving EBITDA from -$15 million to -$6 million. This comes after the company had already reported a notable 46% YoY increase in net revenue in Q2, highlighting its strong growth trajectory.

It needs to be mentioned that Cronos Group Inc. (NASDAQ:CRON) still hasn’t been able to turn any annual net profit over the last 4 years, despite improving its revenue consistently. Hence, the company’s recently renegotiated supply agreement with GrowCo marks a strategic shift that positions it to lower production costs materially.

Cronos Group Inc. (NASDAQ:CRON) also announced recently that its brand Spinach has become the best-selling cannabis brand in Canada, according to HiFyre Retail Analytics for August 2024. Launched in November 2018, Spinach ranks first in both edibles and flower categories. Mike Gorenstein, Chairman, President, and CEO of Cronos Group Inc. (NASDAQ:CRON) stated:

“It’s no surprise to us that Spinach® has secured its position as the number one cannabis brand in Canada, with our focus on elevating the adult consumer experience playing a key role in our success. The Spinach® brand has redefined the cannabis market, creating products that enhance shared moments with friends, and we’re thrilled by the overwhelming support from adult consumers. We’re grateful for their loyalty and enthusiasm, as we continue to lead the industry. Our emphasis on quality, innovation, and groundbreaking product development remains steadfast, with even more innovative offerings on the horizon under the Spinach® brand.”

Cronos Group Inc. (NASDAQ:CRON) ended Q3 with an industry-leading balance sheet with $862 million in cash and cash equivalents – significantly exceeding its current market capitalization – and additional value in loan receivables and real estate assets, with no debt obligations.