OUR 9TH YEAR OF PROVIDING PROPRIETARY CAPITAL MARKETS INTELLIGENCE ON THE CANNABIS / HEMP / PSYCHEDELIC SECTORS
Quick
Links
More Charts
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 05/30/2025
Weekly Sector Credit – Cultivation & Retail Credit Buttressed by Continued Asset Value Coverage
-
- The cultivation and retail sector has clearly been battling significant headwinds, including price compression, slowing growth, and competition from hemp; however, the asset value coverage of liabilities remains strong. The median total liabilities to market capitalization ratio of 2.3x indicates an asset value coverage of liabilities of 1.3x, based on our option-theoretic methodology.
- While the median debt-to-2025 EBITDA ratio of 3.84x continues to be above the sustainable level in a 280E environment, companies are maintaining reasonable liquidity by accruing and not paying their 280E taxes. We don’t know how that will all work out, but in the near term, it is producing some surprisingly good cash flow from operations numbers.
- We are encouraged by what we view as strong execution on Ascend’s $50M add-on, which is evidence that an appetite exists for credits that aren’t pristine.
- Investors should be hedging their equity exposure with some debt investments. Credit spreads are wide relative to high-yield debt, and the senior secured debt of our top ten credit picts is still strong.
Week ended 05/30/2025
Weekly Sector Credit – Cultivation & Retail Credit Buttressed by Continued Asset Value Coverage
-
- The cultivation and retail sector has clearly been battling significant headwinds, including price compression, slowing growth, and competition from hemp; however, the asset value coverage of liabilities remains strong. The median total liabilities to market capitalization ratio of 2.3x indicates an asset value coverage of liabilities of 1.3x, based on our option-theoretic methodology.
- While the median debt-to-2025 EBITDA ratio of 3.84x continues to be above the sustainable level in a 280E environment, companies are maintaining reasonable liquidity by accruing and not paying their 280E taxes. We don’t know how that will all work out, but in the near term, it is producing some surprisingly good cash flow from operations numbers.
- We are encouraged by what we view as strong execution on Ascend’s $50M add-on, which is evidence that an appetite exists for credits that aren’t pristine.
- Investors should be hedging their equity exposure with some debt investments. Credit spreads are wide relative to high-yield debt, and the senior secured debt of our top ten credit picts is still strong.
This Chart is Only Available to Higher Tier Memberships
Please Purchase a Premium or Enterprise membership to see more.
