Cash is a critical factor in the cannabis industry, now more than ever before. The coronavirus pandemic is already testing the limits of many pot companies, in some cases pushing them over the brink and into bankruptcy. And more marijuana companies will be in danger the longer the crisis lasts.

Cannabis investors need to be very picky because even companies that are in good shape today may not be six months from now. However, there are two stocks that are in a good position to weather a prolonged economic downturn due to coronavirus. These two companies are among the most likely to survive the pandemic, even if it lasts for several months or longer.

1. Canopy Growth

Canopy Growth (CGC 0.77%) is the figurehead of the cannabis industry, and the big-name pot stock looks to be in the best shape. But the company hasn't been immune to adversity. On March 4, it announced it was laying off 500 employees and closing two greenhouses while scrapping plans for a third one.

It's a necessary step to bring down the company's costs and fine-tune its bottom line, although it doesn't mean the company's in a dire situation. In Canopy Growth's third-quarter results, released in February, the company reported that it had more than 1.56 billion Canadian dollars of cash on hand as of Dec. 31. That's down from the CA$2.48 billion available in the prior year, but it's still a hefty amount of cash on the books.

A person buys cannabis at a dispensary

Image Source: Getty Images

The company used CA$548.3 million to fund its day-to-day operating activities over the past nine months and another CA$281.4 million for its investing activities, including purchases of property, plant, and equipment. But with new CEO David Klein at the helm who's trying to improve its financials, Canopy Growth was already on track to be a leaner, more cost-efficient operation in 2020.

Klein transitioned from big beverage maker Constellation Brands (STZ 1.38%), which is a key investor in Canopy Growth. The major producer of beer, wine, and spirits can be a valuable resource for the pot stock if times get tough this year. Constellation initially invested in Canopy Growth in 2017, taking a 9.9% stake in the company for $191 million. Then in 2018, it increased its ownership to 37% with an additional investment of $4 billion.

2. Cronos Group

Cronos Group (CRON) is another pot stock that investors can bet on being around after the coronavirus pandemic is over. Cronos released its annual report on March 30 and it posted an inflated $1.16 billion net income as a result of revaluation gains that flipped its operating loss of $121.5 million into a sizable profit. What's arguably more important to investors, however, is that the company reported $1.2 billion in cash and cash equivalents as of Dec. 31. That's more than enough to cover the $130 million that Cronos used in its operations in 2019 and the $603.5 million it spent on investing activities.

Like Canopy Growth, Cronos has a big partner from another industry that's given it an influx of cash as well. Altria Group (MO -0.33%) invested $1.8 billion in Cronos in late 2018 in an effort to diversify and help expand its reach, and add more brands into its portfolio. For Cronos, having a company like Altria, which created Marlboro, at its disposal can help give the pot stock some valuable insights and experience that it can tap into during these difficult times. If there's one industry that knows adversity well, it's big tobacco.

But with more than enough cash on hand to handle the company's cash burn over the past year, Cronos appears to be in good shape moving forward. And if the situation grows worse over the coming months, the company can slash costs to try and conserve as much of that cash as it can. It's already begun doing that with the announcement that it would hold off on the distribution of its hemp-derived CBD tinctures brand, PEACE+.

Although Cronos may not be blowing the doors off with net revenue of just $23.8 million over the past 12 months (Canopy Growth generated net revenue of CA$123.8 million  in just its most recent quarter alone), it's still a safe buy nonetheless.

Which stock is the better buy today?

Over the past year, both Cronos and Canopy Growth have lost close to 66% of their value. That's only slightly better than the Horizons Marijuana Life Sciences ETF, which is down 71% during that time. However, despite their share prices following a similar path, Canopy Growth is the better buy today. With greater sales, Canopy Growth trades at around 18 times its revenue, while investors are still valuing Cronos at a multiple of 80 times its sales over the past 12 months.

Stock chart comparing CGC and CRON

Image Source: YCharts

Cronos is still an expensive stock, and Canopy Growth looks to be much closer to bottoming out than Cronos. It's also an industry leader, and should the cannabis industry start to show signs of life, shares of the cannabis giant will be sure to take off. When that might happen, however, is anyone's guess at this point and likely won't be until the coronavirus no longer poses a threat to the industry. But for long-term investors, now may be a good time to pick up shares of Canopy Growth.