OUR 9TH YEAR OF PROVIDING PROPRIETARY CAPITAL MARKETS INTELLIGENCE ON THE CANNABIS / HEMP / PSYCHEDELIC SECTORS
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Credit Tracker By Industry Sector
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.
Week ended 05/23/2025
Weekly Sector Credit – Cultivation & Retail Credit Quality Stuck in a Holding Pattern
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- The credit quality of the cultivation and retail sector seems likely to remain stable for the next three quarters. Projected weakness in revenues and EBITDA margins relative to the corresponding periods last year threaten to increase metrics like Debt/2025 EBITDA, and we continue to believe that analyst estimates for the fourth quarter are biased on the high side.
- However, working capital and capex controls have stabilized liquidity measures, particularly the free cash flow-adjusted current ratio, which now has a median of 1.03x, indicating a theoretical ability to discharge all current liabilities without additional funding. We would like to see a bit more cushion, but the top 25% of the competitors are in pretty good shape, with measures over 1.8x.
- Financial flexibility remains reasonable, and the debt capital markets remain open, as evidenced by the $50M add-on financing just completed by Ascend Wellness, which falls below the top tier of credit quality.
Week ended 05/23/2025
Weekly Sector Credit – Cultivation & Retail Credit Quality Stuck in a Holding Pattern
-
- The credit quality of the cultivation and retail sector seems likely to remain stable for the next three quarters. Projected weakness in revenues and EBITDA margins relative to the corresponding periods last year threaten to increase metrics like Debt/2025 EBITDA, and we continue to believe that analyst estimates for the fourth quarter are biased on the high side.
- However, working capital and capex controls have stabilized liquidity measures, particularly the free cash flow-adjusted current ratio, which now has a median of 1.03x, indicating a theoretical ability to discharge all current liabilities without additional funding. We would like to see a bit more cushion, but the top 25% of the competitors are in pretty good shape, with measures over 1.8x.
- Financial flexibility remains reasonable, and the debt capital markets remain open, as evidenced by the $50M add-on financing just completed by Ascend Wellness, which falls below the top tier of credit quality.
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