OUR 9TH YEAR OF PROVIDING PROPRIETARY CAPITAL MARKETS INTELLIGENCE ON THE CANNABIS / HEMP / PSYCHEDELIC SECTORS

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Weekly Credit Tracker

Credit ratings are not currently available for public cannabis companies leaving companies, lenders and investors with a gap of information. The Viridian Cannabis Credit Tracker fills this gap. The model uses 11 market and financial statement variables to discern 4 key credit factors: Liquidity, Leverage, Profitability, and Size, to provide credit/liquidity analysis for over 370 public Cannabis/Hemp companies.

Weekly Credit Report 2026 Refinancing Risk Revisited

  • The chart shows the implied asset valuation coverage against the Viridian Credit Rank for each of the twelve U.S. Cultivation and Retail sector companies with either more than $100M or more than 1x market cap of debt maturing in 2026. This week’s Deal Tracker had a graph where we plotted asset coverage against maturing debt as a % of market cap.
  • The four companies on the left (Trulieve, Curaleaf, Verano, and Cresco) have an aggregate of $1.59B in debt maturing in 2026. However, we are not particularly worried about the refinancing prospects of any of these companies. Each of them has an implied asset coverage over 1x, and each of them is ranked in the top 11 out of 31 credits that we rank each week. Moreover, none of these companies have maturing debt that exceeds its market cap. Depending on the tone of the market, refinancings can potentially become expensive, but we are confident that these companies can get the job done.
  • Companies with less than 1x asset coverage, which are also ranked in the lowest decile of credits in our Viridian Credit Tracker Model, including Body & Mind, Gold Flora, Cannabist, 4Front, and Schwazze, pose a significantly higher risk. Each of these companies has between 1.4x and 88x market cap in maturing debt.   2026 maturities for this group aggregate to around $400M, and without significantly better market tone (i.e. better stock prices), it is likely that at least one of these companies has a refinancing “accident” where they end up having to give up significant portions of their equity away to get the refinancing done, or worse.
  • AYR occupies a unique spot in the lineup. Our model ranks AYR more favorably than the group above but we think it has one of the highest refinancing risks of the entire group. The company’s 64% asset coverage is worrisome enough, but its $300M maturing debt is over 5x its market cap. Moreover, we already saw this movie with AYR about a year ago. The company was able to push its maturities out two years at the cost of having to give away over 25% of the company’s equity. Florida Rec would have been AYR’s saving grace, but without that it looks like a nail-biter. The resignation of the company’s CFO makes us even less confident on this one. Of course, rescheduling could happen, and SAFER and the entire tone of the market could change in 2025. But there is a reason these bonds are offered at 80 to yield around 26%!

Credit Tracker By Sector

Credit ratings are not currently available for public cannabis companies leaving companies, lenders and investors with a gap of information. The Viridian Cannabis Credit Tracker fills this gap. The model uses 11 market and financial statement variables to discern 4 key credit factors: Liquidity, Leverage, Profitability, and Size, to provide credit/liquidity analysis for over 370 public Cannabis/Hemp companies.

Weekly Sector Credit – Cultivation & Retail

  • Hopefully, the 1/31/25 sector credit report will mark the bottom of the metrics for cultivation and retail. Total liabilities to market cap worsened to 1.84x from 1.58x last week. Similarly, 2025 EBITDAR/ net adj debt declined from .34x to .30x.
  • On the positive side, stock values had a strong bounce on Wednesday in response to Kennedy making it through the committee and some softening of the stance of interim DEA director Maltz, who said he “would follow the science.”
  • Will the rally hold? Frankly, it will take more decisive action higher up the food chain to convince us. Senior administration officials seem unwilling even to pronounce the word cannabis, let alone take stronger action. We still think positive things are ahead, but as we have said here many times, it is going to take exceptional patience.

Weekly Sector Credit – Cultivation & Retail

  • Hopefully, the 1/31/25 sector credit report will mark the bottom of the metrics for cultivation and retail. Total liabilities to market cap worsened to 1.84x from 1.58x last week. Similarly, 2025 EBITDAR/ net adj debt declined from .34x to .30x.
  • On the positive side, stock values had a strong bounce on Wednesday in response to Kennedy making it through the committee and some softening of the stance of interim DEA director Maltz, who said he “would follow the science.”
  • Will the rally hold? Frankly, it will take more decisive action higher up the food chain to convince us. Senior administration officials seem unwilling even to pronounce the word cannabis, let alone take stronger action. We still think positive things are ahead, but as we have said here many times, it is going to take exceptional patience.

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