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 08/04/2023
The credit stats for the 19 companies in the Agriculture Technology sector continue to look bleak. Liquidity is the primary issue: the median free cash flow adjusted current ratio for the group is an alarming .06x, indicating significant financing requirements. Leverage is not particularly high, with a median total liabilities/ market cap of 1.83x, but borrowing capacity is limited as median funds from operation to total liabilities is -.63x. Only 5 of the twenty companies have analyst coverage and debt/ 2024 EBITDA for that subset is 5.86x. This figure is high but not disastrous, as the group is not subject to 280e. There are some signs that the picture may be improving. Hydrofarm Holdings (HYFM: Nasdaq) just reported positive EBITDA, Cash Flow From Operations, and Free Cash Flow for the 2nd quarter that ended June 2023 and updated guidance to “modestly positive EBITDA” and “Positive Free Cash Flow.”
Week ended 08/04/2023
The credit stats for the 19 companies in the Agriculture Technology sector continue to look bleak. Liquidity is the primary issue: the median free cash flow adjusted current ratio for the group is an alarming .06x, indicating significant financing requirements. Leverage is not particularly high, with a median total liabilities/ market cap of 1.83x, but borrowing capacity is limited as median funds from operation to total liabilities is -.63x. Only 5 of the twenty companies have analyst coverage and debt/ 2024 EBITDA for that subset is 5.86x. This figure is high but not disastrous, as the group is not subject to 280e. There are some signs that the picture may be improving. Hydrofarm Holdings (HYFM: Nasdaq) just reported positive EBITDA, Cash Flow From Operations, and Free Cash Flow for the 2nd quarter that ended June 2023 and updated guidance to “modestly positive EBITDA” and “Positive Free Cash Flow.”
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