CRON
Cronos Group Inc.
$2.85
Platform & Compounding FCF
50%
Two-stage FCF DCF
Mild
·
Conviction
Fair Value
Trading 13.2% below fair value
You pay
$2.85
Bear
$2.97
Fair
$3.29
Bull
$3.60
Bear
$2.97
+4.2%
7% stage 1 growth, 11% discount
Fair
$3.29
+15.3%
11% stage 1 growth, 11% discount
Bull
$3.60
+26.3%
15% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (11% base case)
Terminal Value % of EV
40%
Implied Market Multiple
13.6x
Market is pricing in (growth)
3.7%
vs 11.4% base
Summary
Our base-case estimate uses a two-stage discounted cash flow model based on free cash flow. We then blend that result with the average analyst price target of $3.15 from 15 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $3.29 per share.
Warnings
This company spends 18% of revenue on big investments like data centers and infrastructure, mostly for growth. We adjusted the cash flow figure to only subtract the upkeep costs, giving a clearer picture of true profitability.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions