IIPR - Better Cannabis Stock Buy: Cresco Labs or Innovative Industrial Properties?
2023-03-07 10:10:00 ET
Cresco Labs (OTC: CRLBF) is a pure-play U.S. cannabis company based in Chicago, while Innovative Industrial Properties (NYSE: IIPR) , based in San Diego, is the best-known cannabis real estate investment trust ( REIT ). One thing the two companies have in common, along with many other cannabis companies, is that their shares are struggling.
Cresco's shares are down more than 66% over the past year, while Innovative's are down by more than 52%. Few marijuana stocks have been immune to the conditions affecting these two. A glut of cannabis is hurting profit margins for multi-state operators (MSOs). Inflation and higher interest rates are making it harder for companies such as Cresco to grow and making Innovative's cannabis tenants more tentative. Which of the two stocks is a better buy? Let's see.
The biggest concern for Cresco is that its revenue has been dropping. Its merger with Columbia Care is expected to boost business, because it would increase the company's retail blueprint to more than 100 stores. But that merger's closure has been pushed back to June 30 from the earlier March 31. The companies reasoned that the extension will allow them to finalize divestiture agreements and obtain regulatory approvals.
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Better Cannabis Stock Buy: Cresco Labs or Innovative Industrial Properties?