|Bid||16.49 x 1300|
|Ask||16.53 x 900|
|Day's Range||16.37 - 17.00|
|52 Week Range||9.00 - 44.17|
|Beta (5Y Monthly)||2.47|
|PE Ratio (TTM)||N/A|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||N/A|
The cannabis company's unimpressive fourth-quarter results might urge you to abandon on this stock. Should you?
Canopy Growth (NYSE: CGC) released its fourth-quarter results on May 29. The number that garnered attention was the company's mammoth loss, which totaled $1.3 billion Canadian dollars. It's another big loss from a company that's been no stranger to them in the past.
The cannabis sector generally took a step back after Canopy Growth (CGC) reported a disastrous quarter last week. The Canadian cannabis giant set the sector back after cannabis was generally seen in a positive light coming out of the economic shutdown due to the coronavirus. While the U.S. cannabis space is poised for a strong 2H of the year, the sector wasn’t completely unscathed during the coronavirus shutdown. A few states such as Massachusetts and Nevada closed stores during the virus outbreak hitting revenues hard in those states.While some of the large multi-state operators (MSOs) have rallied near pre-virus highs, the smaller MSOs are just now starting to rally. These stocks all trade with market values far below $1 billion and could eventually become acquisition targets from Canadian operators or new entrants into the space.The ultimate gift for shareholders could exist from the Safe Banking Act getting approved via current legislature in the House as part of another round of stimulus. Over 34 state Attorney Generals approved the passage of the bill to eliminate the handling of cash, amongst other reasons. Access to capital will help these secondary MSOs to a greater extent than the larger ones.With this in mind, we’ve delved into three under-the-radar MSO stocks to consider as the U.S. cannabis space is set to thrive during the economic reopening. Using TipRanks' Stock Comparison tool, we were able to read the fine print on what 2020 has in store for the three MSO players.Harvest Health & Recreation (HRVSF)Harvest Health & Recreation has been one of the most disappointing MSOs due to a couple of failed large-scale deals. The company has had to retreat from deals that would’ve placed Harvest Health into a leading MSO position, but the company is now focused on growing markets with recreational optionality in the future.The company now has core operations in Arizona, Florida, Maryland and Pennsylvania. The Arizona operation has 14 open dispensaries with a good shot for the state approving recreational cannabis by the end of 2020.For Q1, Harvest Health had $45.0 million in quarterly revenues with a 19% increase from the prior quarter. The cannabis MSO reported a small quarterly EBITDA loss of $3.9 million and expects to reach EBITDA positive in the 2H. Harvest Health needs to boost margins presently at 42%, but the company expects revenue growth and $6 million in quarterly expense cuts to drive the bottom line improvement.The company targets over $200 million in 2020 revenues with the optionality of recreational cannabis in Arizona alone adding a boost of $50 million to the revenue base for 2021. The stock has a market cap of $405 million which could be very appealing in a scenario where any of their core states add recreational cannabis.Harvest Health still trades near the lows of 2020 and far off the 2019 highs. The stock could easily trade below 2x actual 2021 sales assuming Arizona approves recreational sales in the November ballot.All in all, Wall Street is not convinced just yet on this MSO player, but optimism is circling, as TipRanks analytics demonstrate Harvest Health as a Buy. Based on 3 analysts polled in the last 3 months, 2 rate the stock a Buy, while 1 remains sidelined. The 12-month average price target stands at $2.77, marking a 141% upside from where the stock is currently trading. (See Harvest Health stock analysis on TipRanks)Columbia Care (CCHWF)Columbia Care remains one of the few MSOs not well known by the market. The company just reported Q1 results $28.9 million, up $4.4 million from the December quarter.The MSO has strong operations in Florida, Illinois, Massachusetts and Ohio, amongst other states. In total, Columbia Care has licenses in 18 U.S. jurisdictions plus the E.U.Between the Illinois store having business disruption recently due to COVID and Massachusetts shutting down recreational cannabis sales until last week, Columbia Care expects disrupted Q2 sales for areas just ramping up. As with Harvest Health, the MSO is positioned for the optionality of recreational approval in other states while having a relatively small revenue base.For 2020, Columbia Care is forecasted to generate revenues of $210 million with a market cap of $620 million. More importantly, the MSO is expected to double revenues in 2021 to over $400 million before even seeing upside from a Florida approval of recreational cannabis in a few years.The small MSO has $45 million in liquidity and $27 million in cash with the expectation for additional transactions later this year. Columbia Care is still generating large EBITDA losses as the company still launches operations in states such as New Jersey and Virginia. Although the stock has only a few analysts currently throwing the hat in the ring, all are bullish on the stock. Columbia Care’s analyst consensus rating is a Strong Buy, with all 3 analysts giving it the thumbs up. The 12-month average price target stands at $8.71, which implies over 200% upside from current levels. (See Columbia Care stock analysis on TipRanks)AYR Strategies (AYRSF)One MSO actually hit by the coronavirus crisis was AYR Strategies. The company operates in both Massachusetts and Nevada where the states chose to close dispensaries or recreational sales.For the March quarter, AYR Strategies reported revenues rose 4% to $33.6 million. The company was highly profitable heading into the mid-March COVID related closures in both Nevada and Massachusetts reduced sales towards the end of March. The company predicted sales would’ve risen by 16% sequentially in the quarter without the store closures.The Q1 numbers weren’t hit hard with adjusted EBITDA still coming up at $8.4 million and cash flow of operations hitting $7.4 million. With Massachusetts blocking recreational cannabis until May 25, AYR Strategies forecasts June returning to the Q1 EBITDA levels with margins approaching 25%.Analysts have AYR Strategies reaching $230 million in sales for 2021 while the stock valuation is only $152 million now. The stock trades at ~1x forward sales estimates while the industry as a whole trade closer to 3x forward sales.The company only has $9.9 million in cash which could hold back investors, but the solid adjusted EBITDA position of the company should allow for AYR Strategies to easily raise cash in the future. Any approval of U.S. cannabis regulations would help this small MSO either raise cash or attract a suitor at premium prices. All in all, AYR Strategies maintains a Strong Buy from the analyst consensus, based on 4 recent ratings. These include 3 Buys and 1 Hold, giving a 3 to 1 advantage to the bulls. Share are trading at $7.70, so the $51.33 average price target suggests room for whooping 567% upside. (See AYR Strategies stock analysis on TipRanks)To find good ideas for cannabis stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.Disclosure: No position.
While Canopy Growth Corp (NYSE: CGC) has announced strategic changes that could help lower its cost burden, the company is "sized for growth" that may not materialize in the medium-term, according to MKM Partners.The Canopy Growth Analyst Bill Kirk maintained a Neutral rating on Canopy Growth and reduced the price target from CA$21 ($15.56) to CA$19 ($14.08).The Canopy Growth Thesis Canopy Growth reported sequential deceleration in revenue and a wider EBITDA loss for the fiscal fourth quarter, while most peers announced sequential improvements, Kirk said in a Thursday note. (See his track record here.)Canopy Growth identified certain strategic and organizational changes, like facilities closures, market exits and layoffs, which may reduce its cost burden, the analyst said.Yet the company is too large for the current environment and continues to cultivate much more than it can sell, he said. Kirk further said that Canopy Growth may not make much progress on the adjusted EBITDA front in fiscal 2021, given low-priced and lower -margin value offerings being the primary growth opportunity."Upside in Canopy shares is more likely via legislative changes/excitement than operational improvement."CGC Price Action Shares of Canopy Growth had declined a little over 1% to $16.35 at the time of publication Thursday.Related LinksAphria, Aurora Analyst Says Buy The Dip To Take Advantage Of Cannabis Stock Sell-OffCannabis Countdown: Top 10 Marijuana And Psychedelic Stock News Stories Of The WeekLatest Ratings for CGC DateFirmActionFromTo Feb 2020Stifel NicolausMaintainsBuy Jan 2020BMO CapitalUpgradesMarket PerformOutperform Nov 2019Bank of AmericaUpgradesNeutralBuy View More Analyst Ratings for CGC View the Latest Analyst Ratings See more from Benzinga * Aphria, Aurora Analyst Says Buy The Dip To Take Advantage Of Cannabis Stock Sell-Off * Aphria, Aurora Among Top Performers As Canadian Cannabis Sales Spike * Canopy Growth Set To Become Cannabis Sector Leader, Says BofA(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
OTTAWA, ON / ACCESSWIRE / June 4, 2020 / Tetra Bio-Pharma Inc. ("Tetra" or the "Company") (TSXV:TBP)(OTCQB:TBPMF), a bio-pharmaceutical company engaged in cannabinoid-derived drug discovery and development and Storz & Bickel, a subsidiary of Canopy Growth Corporation, (TSX:WEED)(NYSE:CGC), a world-leading diversified cannabis, hemp and cannabis device company, are pleased to announce that they have finalized a definitive commercial sales agreement for the sale of the Mighty Medic device as part of the CAUMZ™-kit drug-device combination product. Today Tetra announces a commercial sales agreement with Canopy to ensure the supply of the medical device component of the CAUMZ™-kit.
For years, marijuana stocks were viewed by investors as the greatest thing since sliced bread. With the legal pot industry generating $10.9 billion in worldwide sales in 2018, and Wall Street suggesting that annual global sales could hit $50 billion to $200 billion by 2030, investors figured they had a surefire winner on their hands. The reality of the challenges they're facing in Canada and the U.S. have sunk in with investors, and most pot stocks have seen their share price retrace anywhere from 50% to 95%.
Aurora Cannabis (NYSE: ACB) surprised nearly everyone in mid-May with better-than-expected fiscal 2020 third-quarter results. It was a much different story for Canopy Growth (NYSE: CGC) when the company reported its fiscal 2020 fourth-quarter update last week. With the two divergent quarterly updates, is Aurora now the better pick for long-term investors?
Aurora Cannabis (NYSE: ACB) and Canopy Growth (NYSE: CGC) are two of the biggest names in the cannabis industry today. Both companies have struggled with profitability and growing their sales in recent quarters. Investors are better off buying shares of Curaleaf Holdings (OTC: CURLF), and here's why.
A formerly bullish analyst is now bearish on the popular cannabis company -- and he's warning that more pain could lie ahead for shareholders.
Despite recent troubles, Canopy Growth is optimistic its cannabis beverages can dwarf the growth of hard seltzers.
What is the worst thing an investor could hear from a market share leader? According to Jefferies’ analyst Owen Bennett, it is probably the need to "understand what consumers want.”And that’s just what Canopy Growth (CGC) has said. According to the analyst, the Canadian cannabis producer’s disappointing FQ4 results indicate “things are worse than thought.”Canopy's Q4 net revenue came in at C$107.9 million, well below the C$128.9 million estimate and down by 13% from the previous quarter. The enormous overall net loss of C$1.3 billion, amounted to C$3.72 per share, far worse that the Street’s expectation of C$0.59 per share. Cue investors running to the exit door and a drop of 20% in the following trading session.Bennett recently upgraded Canopy’s rating from Sell to Hold, based on the reasoning “top line pressures were better understood,” and under the impression cost saving actions were moving the company in the right direction.Pointing out the slim bull case for Canopy rested on “increased focus on cost structure and profit delivery,” the analyst believes the turnaround appears more sluggish than anticipated as evidenced by operating expenses. Instead of improving, these increased by 17% compared to the previous quarter.Additionally, looking ahead, Canopy reduced expectations, describing FY21 as a “transition year,” and taking off the table previous forecasts for when it would achieve positive adjusted EBITDA.Along with the letdown of the report, the tone coming from Canopy’s direction has not impressed Bennett, who said, “While it said it is addressing certain headwinds with a shift into value and more high THC offerings, what really concerned us was commentary around needing to "understand what consumers want", and "servicing different segments". This is just basics and an issue we flagged over 12 months ago when initiating (Canopy having a catch all brand with no segmentation) and is something that in our view should be addressed prior to legalisation, not over a year into it, and especially from a market share leader.”To this end, Bennett reiterated a Hold and has a C$22.00 (US$16) price target on Canopy shares. (To watch Bennett’s track record, click here)Most of Wall Street echoes a neutral point of view, with TipRanks analytics exhibiting Canopy Growth as a Hold. Based on 15 analysts tracked by in the last 3 months, 2 say Buy, 10 suggest Hold, while 3 recommends Sell. Meanwhile the 12-month average price target stands at C$22.44, which aligns with where the stock is currently trading. (See Canopy Growth stock analysis on TipRanks)To find good ideas for cannabis stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.
On this episode of Yahoo Finance Presents, Canopy Growth CEO David Klein sat down with Yahoo Finance's Zack Guzman to talk about their recent strategic review, new products, and the potential for future expansion into the U.S. market.
Shares of Canopy growth (CGC) are trading 30% lower since its latest quarterly results last week. However one analyst sees share as undervalued for the Canadian cannabis company which has shifted from medical to more recreational sales when that market was legalized in Canada almost two years ago. “Although we expect the medical market to shrink because of recreational legalization, we forecast more than 10% average annual growth for the entire Canadian market through 2030, driven by the conversion of black-market consumers into the legal market and new cannabis consumers,” analyst Kristoffer Inton wrote in a note to investors.
Hey Manitoba, we are excited to see you again!
Canopy Growth stock tanked more than 20% on Friday after the marijuana grower reported a loss in its fiscal year and withdrew financial forecasts. The stock is down again on Monday.
Canadian cannabis stocks tumbled Friday after Canopy Growth Corp (NYSE: CGC) reported a significant miss for its March quarter sales and withdrew its outlook for reaching positive EBITDA. Canopy also expressed concern over the company's June quarter prospects.The problems witnessed by Canopy Growth in the March quarter seem to be company-specific, and the broader sell-off among the group makes Aphria Inc (NYSE: APHA) and Aurora Cannabis Inc (NYSE: ACB) even more attractive, according to Cantor Fitzgerald.The Aphria, Aurora Analyst Pablo Zuanic maintained Overweight ratings on both Aphria and Aurora Cannabis, with price targets of CA$9.55 ($6.97) and CA$27.00 ($19.71), respectively.The Cannabis Market Thesis While Canopy Growth reported a 28% sequential decline in recreational sales before provisions, the industry witnessed 18% growth in the March quarter, Zuanic said in the note. (See his track record here.) Although June could be challenging for the industry, other companies will likely perform much better than Canopy Growth, the analyst said. U.S. data indicated robust demand during the pandemic, he said. Friday's sell-off increases the attractiveness of Aphria and Aurora Cannabis, as both companies are performing better than Canopy Growth in key metrics like scale, sales growth, average pricing and Cannabis 2.0 products; they have better profit margin trajectories; and their stocks currently trade at "hefty discounts," Zuanic said. APHA, ACB Price Action Shares of Aurora Cannabis were down 1.28% at $13.90 at the time of publication Monday, while Aphria's stock was up 4.14% at $4.40. View more earnings on ACBRelated Links: The Week In Cannabis: A Mixed Bag Leads Marijuana Stocks To UnderperformCantor Fitzgerald Says Aurora Cannabis Sell-Off Creates Entry PointPhoto courtesy of Aurora Cannabis. Latest Ratings for ACB DateFirmActionFromTo May 2020JefferiesDowngradesHoldUnderperform May 2020Cantor FitzgeraldMaintainsOverweight May 2020CIBCMaintainsNeutral View More Analyst Ratings for ACB View the Latest Analyst Ratings See more from Benzinga * Aphria, Aurora Among Top Performers As Canadian Cannabis Sales Spike * Canopy Growth Set To Become Cannabis Sector Leader, Says BofA * Cantor Cuts Canopy Growth Target After Warrants Exercise(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
The U.S.-listed shares of Canopy Growth Corp. dropped 4.2% in premarket trading Monday, after Stifel Nicolaus analyst Andrew Carter swung to bearish from bullish in the wake of the Canada-based cannabis company's disappointing earnings report and "significant" challenges ahead. The stock had plunged 20.0% on Friday after the fiscal fourth-quarter report. Carter cut his rating to sell after being at buy for at least the past year, and cut his price target by 22% to C$18. "Canopy Growth sports the resources to deliver on its ambitions of leading growth in the global cannabis category, but the resources have yet to produce tangible evidence of on an enduring right to win in the developing category," Carter wrote in a note to clients. "We believe course correction will be difficult, expenses will remain elevated, and catalysts for driving enthusiasm will be slow to develop necessitating a further re-rating for the shares." The stock has dropped 7.5% over the past three months through Friday, while the Cannabis ETF has gained 6.4% and the S&P 500 has tacked on 3.1%.
U.S. cannabis company Acreage Holdings Inc. said Monday it has entered two funding agreements to raise up to $60 million. The first is a standby equity distribution agreement with an unnamed institutional investor for up to $60 million of its Class A subordinate voting shares, and the second is a private placement in which it issued $11 million in principal amount under a secured convertible debenture for gross proceeds of $10 million. Proceeds of both deals will be used for general corporate purposes and working capital. New York City-based Acreage has an option agreement with Canadian cannabis market leader Canopy Growth Corp. , under which Canopy will take over the company as soon as the federal ban on cannabis has been lifted. Acreage shares were not active premarket, but have fallen 44% in the year to date, while the Cannabis ETF has fallen 16% and the S&P 500 has fallen 6%.
A steep selloff on Friday in the shares of Canopy Growth Corp. increases the attractiveness of Aurora Cannabis Inc. and Aphria Inc. which both trade at a discount on enterprise value/current sales despite having similar or even better growth prospects, according to Cantor Fitzgerald. "Admittedly, WEED has $1.3Bn of cash (although down from $4.9Bn, and at an annualized free cash flow run rate of -C$1.2Bn based on the Mar qtr), but the gap seems excessive to us," analyst Pablo Zuanic wrote in a note to clients. Canopy shares tumbled after the company's March quarter sales fell short of estimates and the company pulled guidance for reaching positive EBITDA. "We think WEED's March quarter problems were company-specific; the company's rec sales before provisions were down 28% seq in the Mar quarter, while the industry grew 18%, with all the LPs that we cover posting double-digit growth," the analyst wrote. "As such, while June may be challenging for the LP industry (potentially), we believe WEED will lag again by a hefty margin." Zuanic favors Aurora and Aphria, which he rates as overweight, the equivalent of buy. The two companies had the industry's higher B2B recreational sales in the March quarter, he wrote. Aurora is well ahead of peers in domestic medical sales too, said the note. Aurora's U.S.-listed shares were down 3% premarket, while Aphria was down 1.2%. Canopy was down 3.2% and has fallen 17.6% in the year to date, while the Cannabis ETF has fallen 15.6% and the S&P 500 has fallen 6%.
Canopy Growth (NYSE: CGC) shares aren't anywhere close to their levels in late 2018 and early 2019 as the Canadian adult-use recreational marijuana market was first launching. If Canopy can remain a top leader in the industry, it could be able to deliver more impressive gains in the future than it has in the past. There's no question that Canopy has plenty of growth opportunities.
Canopy Growth Corp. reported its second billion-dollar loss Friday, as the company remains mired in a restructuring effort that it started in December.
After Aurora Cannabis (NYSE: ACB) posted surprisingly positive Q3 results last week, some might have thought that Canopy Growth (NYSE: CGC) would have good news in its quarterly update this week. Canopy announced its fiscal 2020 fourth-quarter and full-year results on Friday and the marijuana stock fell more than 20% in intraday trading, which gives you an idea of how the company performed in Q4. Here are 10 things to hate about Canopy Growth's Q4 update, along with a couple of things to love.
CGC earnings call for the period ending March 31, 2020.