Cresco Labs: Buy, Sell or Hold?

Haywood Securities analyst Neal Gilmer says Cresco Labs (Cresco Labs Stock Quote, Chart, News, Analysts, Financials CSE:CL) reported stronger-than-expected Q2 results, helped by revenue growth, higher gross margins and improved operating efficiency.

In an Aug. 6 update, Gilmer reiterated his “Buy” rating and $2.30 target on Cresco. His target is based on nine times his 2027 EBITDA estimate, discounted by 15%.

Cresco reported Q2 fiscal 2026 results that were above Haywood’s expectations. Revenue rose 14.5% sequentially, helped by nine Pennsylvania stores under a managed services agreement, while management said organic growth contributed 4%.

Gilmer said higher-than-expected gross margins and stronger revenue drove Adjusted EBITDA 12.4% above his forecast.

“Following a review of the Q2/26 results and subsequent conference call with guidance for Q3, we have adjusted our estimates slightly but there are no material changes,” Gilmer said.

The analyst said the Q2 outperformance was offset by a slightly more conservative outlook than Haywood had previously modelled.

Cresco is a Chicago-based multi-state cannabis operator with a portfolio of brands including Cresco, Reserve, Mindy’s and Good News.

“Cresco continues to take positive steps towards optimizing its footprint and product portfolio, driving efficiencies across its operations,” Gilmer said.

Gilmer said management has reduced operating costs, supporting improved Adjusted EBITDA and cash from operations.

Gilmer expects Cresco to generate Adjusted EBITDA of $145.5-million on revenue of $676.0-million in fiscal 2026, improving to Adjusted EBITDA of $160.8-million on revenue of $704.9-million in fiscal 2027.

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