Cresco Labs (CSE:CL) (OTCQX:CRLBF) is currently rising, up roughly 5% at the time of writing. On the OTC, shares are selling for $11.30 USD. Could the company's impending Q1 results have anything to do with the climb?
All eyes are on Cresco right now as analysts expect big things for these financial results. At the same time, the company has just announced a lock-up agreement with shareholders, which is adding to the positive sentiment surrounding this company.
Cresco Labs Eve of Q1 2019 Results
As stated, analysts are expecting big things for Cresco. According to MarketRealist, expectations are as follows:
- Revenue to rise sequentially to $22.6 million from $16.9 million, and then rise to $33.7 million in Q2 and $93.1 million in Q3.
- Net loss of $4.2 million is expected in Q1. This is compared to its net loss of $6.8 million in the previous quarter.
- Net profit of $3.3 million is expected in the second quarter.
With four analysts recommending Cresco stock as a "Buy," the company has a lot to live up to. But previous results suggest it will do just that as "Cresco’s revenue rose by 33% sequentially and an impressive 411% in the fourth quarter."
The company has a mean price target of $20.25 CAD, which, if reached, is almost an 80% increase on current prices.
Cresco Labs Lock-Up Agreement
Earlier today, the company announced "that shareholders representing 205,172,192 common shares have entered into voluntary lock-up agreements with the Company."
These shareholders include all of the founding members of the company, its entire executive management team and board of directors, as well as several of its bigger outside investors. A lock-up agreement prevents anyone involved from trading or selling their shares for a specified period of time. It effectively means you hold your position in the company until that period ends.
Cresco's lock-up period will last until "December 3rd, 2019 when a portion of the shares will be released followed by the remainder of the shares being released by June 3, 2020."
In place to protect investors, the Cresco Labs lock-up agreement is helping to put shares in the green today. If nothing else, it reflects the confidence that insiders have in the company and gives added incentive to drive the business forward.
What do you think? Are you looking forward to Cresco Labs Q1 results?
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