CVSI stock is one of the worst performers in the cannabis sector on Wednesday after CV Sciences, Inc. (OTCQB:CVSI) posted a lower than estimated revenue for the second quarter—although this isn’t to say that the numbers were all bad.
Revenue Below Estimates
Although it is true that the whole cannabis sector is going through a bit of chaos over the past few months, there are some companies that have continued to perform admirably and CV Sciences is certainly one of them, if its Q2 2019 performance is anything to go by. Although the CV Sciences stock managed to gain as much as 45% by March, it later lost much of those gains, and currently, CVSI stock is trading at a loss of 15% in 2019 so far.
That being said, the company has managed to come back strong with an impressive performance in its second quarter. However, it needs to be mentioned that the results fell short of analysts’ expectations.
In the second quarter, the company generated revenues of $16.9 million, which reflects a year-on-year rise of 36%. However, this did not meet analysts’ expectations of $17.45 million. The net income for the period hit $1.2 million as opposed to net income of $3.3 million in the prior-year period. Earnings per share stood at 1 cent. However, on non-GAAP adjustment, the net income hit $3.4 million, with earnings of $.03 per share. Analysts estimated earnings per share of $.01 on a non-GAAP adjusted basis.
At the time of writing, CVSI stock is down over 15% and now trading at $3.43.
Although it did not meet analysts’ expectations, it needs to be pointed out that this is the highest revenue figure that CV Sciences has generated in its history. In addition to that, Q2 2019 marks the 14th straight quarter in which the company has grown its revenues. The decline in net income, on the other hand, is on the rising costs, which ballooned by as much as 86% year-on-year and hit $10.7 million.
Looking ahead, the company announced that in 2019 alone, it has successfully launched as many as nine new products and many more products are in the works. It has also consolidated its presence in the states of Ohio, California, and Texas following favorable legislation with regards to CBD.
What do you think about CVSI stock after today’s earnings?
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