Curaleaf’s stock price has dropped in the past few years as the cannabis industry’s momentum and enthusiasm have waned. The CURLF share price is hovering near its all-time low, meaning that its market cap has dropped to $1.1 billion, down from a record high of $12.2 billion. Investors have experienced a $10 billion wipeout.
Curaleaf stock crashes amid concerns
Curaleaf, one of the top American cannabis companies, has come under pressure in the past few years because of external and internal factors.
Broadly, cannabis stocks have plunged because the industry has not thrived as many analysts were expecting a few years ago. Its performance has been fairly weak amid sky-high competition from well-known and smaller brands.
The industry has also had some legal issues in the United States. While many states have now passed cannabis regulations, the industry faces many challenges. For example, many mainstream banks have avoided cannabis companies because of the legal issues. The Senate, under Chuck Schumer, attempted to pass a cannabis banking bull but was not successful.
At the same time, attempts to reschedule cannabis to become a less dangerous drug have stalled, especially now that Donald Trump has become president. Analysts expect that the rescheduling by the Drug Enforcement Agency (DEA) will take time.
The crisis in the cannabis industry escalated late last year when Florida voters voted against allowing recreational marijuana in the state.
Curaleaf stock price has also crashed because of micro factors. While its annual revenue has jumped, the company has continued to make losses. Its annual loss in 2023 was $281 million. Its trailing twelve months loss was $201 million.
Curaleaf financial overview
The most recent third-quarter results showed that the Curaleaf revenue dropped slightly to $330 million. It blamed the slowdown to increased competition, regulatory overhang, unprecedented weather conditions, and challenging pricing by competitors.
The management now focuses on the international market, where it sees significant opportunity. Some of these places are in the United Kingdom and Germany. Its international revenue grew by over 80% in that quarter.
Wall Street analysts believe that Curaleaf’s revenue for the current quarter will be $332 million, down by about 3.79% from the same period a year earlier. Its annual revenue for the next two financial years will be $1.35 billion and $1.46 billion.
A key challenge that Curaleaf is facing is that it won’t become profitable soon. Analysts expect that its annual loss per share will be 27 cents and 21 cents in the next two financial years.
Analysts are optimistic that the Curaleaf stock price will continue doing well in the coming years. The average CURLF stock forecast is $4.62, up by over 210% from the current level.
Curaleaf stock price forecast
The daily chart shows that the Curaleaf share price has been under pressure in the past few years as most cannabis stocks plunged. It recently dropped below the important support at $2.30, a key support level, which was the lower side of the inverse cup and handle pattern. A C&H is one of the most popular continuation signs.
Curaleaf’s Average Directional Index (ADX) has jumped to 36, a sign that the downward trend is strong. The MACD and the Relative Strength Index (RSI) have continued falling.
Therefore, because of the inverse C&H pattern, there is a likelihood that the Curaleaf stock price will continue falling as sellers target the next key support at $1. Like Tilray stock price, there are signs that it too will move below $1 soon.
There is always a risk of shorting highly shorted companies like Tilray Brands because they often have short squeezes.
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