SNDL (NASDAQ:SNDL) Posts Earnings Results

SNDL (NASDAQ:SNDL) released its quarterly earnings data on Tuesday. The company reported ($0.02) earnings per share for the quarter, FiscalAI reports. The business had revenue of $165.94 million during the quarter, compared to the consensus estimate of $166.26 million. SNDL had a negative net margin of 2.36% and a negative return on equity of 2.00%.

Here are the key takeaways from SNDL’s conference call:

• Second-quarter results weakened: Net revenue fell 3.7% year over year to CAD 235.8 million, gross profit declined 16.6% to CAD 56.3 million, and adjusted operating loss was CAD 7 million. Liquor Retail and Cannabis Operations were the largest contributors to the decline.
• Cannabis Operations faced significant production inefficiencies: Revenue declined 10.1%, gross margin fell to 1.8%, and adjusted operating loss widened to CAD 9 million, with management attributing roughly 80%–90% of the gross-margin shortfall to the Jeeter production ramp-up. Some cost pressure is expected to persist over the coming months.
• Balance-sheet strength supported shareholder returns and strategic flexibility: SNDL held CAD 183.2 million of unrestricted cash and no debt at quarter-end, repurchased CAD 23.3 million of shares in Q2, and has reduced its share count by approximately 7% since Q4 2024. Management also expects more than CAD 20 million of incremental operating income from profit-enhancement initiatives, mostly later this year.
• Parallel restructuring created a potential U.S. cannabis growth platform: Subject to legal, regulatory, accounting, and Nasdaq requirements, SNDL expects to gain direct control of Parallel’s medical cannabis operations in Florida, Texas, and Massachusetts. The platform includes 56 retail locations, approximately 800 employees, and near-term annualized revenue of about CAD 150 million.
• Management expects mixed but improving conditions in the second half: Cannabis retail margins improved despite negative same-store sales, and SNDL anticipates low-single-digit market growth in Alberta and Ontario during the second half. Liquor demand remains uncertain, although management expects reduced promotional intensity to support flat-to-improving margins.

SNDL Stock Performance

Shares of SNDL stock traded up $0.04 during trading on Thursday, hitting $1.24. The company’s stock had a trading volume of 670,229 shares, compared to its average volume of 1,883,355. The company has a current ratio of 4.84, a quick ratio of 3.25 and a debt-to-equity ratio of 0.12. The company has a market cap of $317.89 million, a PE ratio of -20.58 and a beta of 0.92. The business has a fifty day moving average of $1.37 and a 200-day moving average of $1.45. SNDL has a 52 week low of $1.17 and a 52 week high of $2.89.

Wall Street Analysts Forecast Growth

A number of brokerages have commented on SNDL. Weiss Ratings reissued a “sell (e+)” rating on shares of SNDL in a report on Thursday, June 11th. Zacks Research raised SNDL from a “strong sell” rating to a “hold” rating in a research report on Thursday, May 28th. One research analyst has rated the stock with a Buy rating, one has issued a Hold rating and one has issued a Sell rating to the stock. According to MarketBeat.com, the company currently has an average rating of “Hold” and a consensus price target of $5.00.

Institutional Inflows and Outflows

Institutional investors have recently bought and sold shares of the business. Arrowstreet Capital Limited Partnership boosted its holdings in shares of SNDL by 718.2% in the 3rd quarter. Arrowstreet Capital Limited Partnership now owns 4,622,786 shares of the company’s stock worth $12,325,000 after buying an additional 4,057,790 shares during the last quarter. JPMorgan Chase & Co. purchased a new position in SNDL in the third quarter valued at about $5,039,000. HRT Financial LP purchased a new position in SNDL in the fourth quarter valued at about $1,346,000. Lazard Asset Management LLC bought a new position in shares of SNDL during the 3rd quarter valued at approximately $2,130,000. Finally, Millennium Management LLC raised its holdings in shares of SNDL by 120.1% in the 4th quarter. Millennium Management LLC now owns 1,156,161 shares of the company’s stock worth $1,919,000 after purchasing an additional 630,870 shares during the period.

About SNDL

SNDL Inc, formerly known as Sundial Growers Inc, is a Canada-based consumer packaged goods company focused on the production, manufacturing and distribution of cannabis products. Headquartered in Calgary, Alberta, SNDL operates multiple cultivation and processing facilities across Canada, including indoor and hybrid greenhouses in British Columbia and Ontario. The company serves both adult-use and medical cannabis markets, supplying provincial distributors as well as operating through its own wholesale and retail networks.

The company’s product portfolio spans dried flower, pre-rolls, vape cartridges, cannabis oils, edibles and infused beverages under a variety of in-house brands.