|Bid||14.50 x 2200|
|Ask||14.55 x 1200|
|Day's Range||14.44 - 15.99|
|52 Week Range||9.00 - 52.74|
|Beta (5Y Monthly)||3.86|
|PE Ratio (TTM)||N/A|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||N/A|
The global economic shutdown due to the coronavirus was a potential nightmare for Aurora Cannabis (ACB). The Canadian cannabis company is in the middle of cutting capacity and costs for the new reality in the market while trying to avoid running out of cash. A complete shutdown of cannabis stores would’ve crushed any remaining hope in financial improvements at the business, but the market has seen the opposite effect of the shutdown actually lead to a boost to cannabis sales as consumers stay at home.Booming SalesOn March 17, Canopy Growth (CGC) announced the closure of all 23 of their retail stores in Canada due to the Covid-19 outbreak. Since this point, sales have soared in Canada as consumers have rushed to purchase weed.Several provinces including Ontario and Quebec have deemed cannabis stores as essential while the Ontario Cannabis Store’s website had the director of communications confirm sales over the weekend doubled the sales from only two weeks ago. Likewise, Nova Scotia reported cannabis sales spiked 76% last week.Whether due to fears of store closures or adult users staying at home with no work, people have flocked to cannabis stores to ensure supplies to wait out the virus from home. In addition, a supplier like Aurora Cannabis gets the extra benefit of not having Canopy Growth stores open.The one major caveat is that Canadian cannabis sales could yet be impacted as the virus outbreak rolls throughout the country and any lingering impact is unknown.RescueThe sales boost couldn’t have come at a better time. The Canadian sector was flooded with cannabis supply and companies were struggling to generate profitable revenue growth. Aurora Cannabis alone had C$216 million in inventory on their books suggesting enough supply for the next year.The company couldn’t afford another quarter of weak sales. Based on the initial sales indications from March, Aurora Cannabis should top analyst estimates for a revenue rebound to C$65 million in the current quarter. The company had net revenues of C$63 million in the December quarter.The company has initiated a cost reduction program to get quarterly operating expenses below C$45 million. A key aspect of any turnaround is for Aurora Cannabis and the sector to actually generate revenue growth in 2020 with new retail stores opening and Cannabis 2.0 products launching. The combination will help cut the EBITDA losses.Ontario was set to start allowing 20 new stores to open per month and the Covid-19 outbreak might provide some regulatory and construction delays, but the market should start seeing consistent growth in the key province. Aurora Cannabis has survived the bottom and can now continue with at-the-market equity sales to raise funds for operations and the last remaining capex spending.TakeawayThe key investor takeaway is that Aurora Cannabis got the sales boost the company needed to get over the hump. The former CEO selling 12.16 million shares into the open market on March 16 was the headline that likely created a bottom in the stock below $0.70.Aurora Cannabis should see the diluted share count balloon to 1.3 to 1.4 billion shares outstanding. As the company approaches an EBITDA breakeven level later in the year with the streamlined operations, the stock will finally get a footing back above $1.According to TipRanks, the consensus on Wall Street is that Aurora stock is a “hold” for investors. But TipRanks might as well have said “buy” — because analysts, on average, think the stock, currently at $0.99, could zoom ahead to $1.71 within a year, delivering 71% profits to new investors. (See Aurora stock analysis on TipRanks)
States like New York will see significant revenue shortfalls due to coronavirus. Legalizing cannabis could make up for a quarter of the losses, which could help push legislation forward.
Investors need to pay close attention to Canopy Growth (CGC) stock based on the movements in the options market lately.
SLANG Worldwide Provides Update on Recent Developments and COVID-19
We hate to say this but, we told you so. On February 27th we published an article with the title Recession is Imminent: We Need A Travel Ban NOW and predicted a US recession when the S&P 500 Index was trading at the 3150 level. We also told you to short the market and buy […]
Bruce Linton, formerly the CEO of cannabis behemoth Canopy Growth (NYSE: CGC) and now Director of Mind Medicine (OTC: MMEDF) is this week's guest on The Green Rush! Since his departure from Canopy in 2019, Bruce has since moved onto several new ventures within the cannabis and psychedelics spaces but is still the unquestioned face of the industry. Started with CNBC's Kevin O'Leary, Bruce's most notable role right now is with Mind Medicine, a neuro-pharmaceutical company that discovers, develops and deploys psychedelic inspired medicines to improve health, promote wellness and alleviate suffering.Fresh off taking Mind Med public on the NEO Exchange, Bruce sat down with Lewis to chat about what he's been up to since his departure from Canopy. The two touch on all of the headlines dominating the cannabis industry including most notably the public markets and capital crunch as well as what his outlook is for the long and short-term future of the space. In addition, the two tackle the burgeoning psychedelics industry and explore the work that Mind Med is currently undergoing, why now was the time to take the company public and what convinced Bruce that psychedelics were the real deal.In addition, the pair discuss Bruce's other cannabis ventures including his roles at Vireo Health (OTC: VREOF), Better Choice Company (OTC: BTTR) and Gage Cannabis. As most know, Bruce is a one-of-a-kind leader in this space and his interview with Lewis provides a ton of great insights on how he is approaching the future.Don't sit back, lean forward and enjoy!See Also: Green Rush Podcast: Vanguard Scientific's Matthew Anderson On The Cannabis Capital Crunch And Ancillary ServicesBruce Linton, Director of Mind Medicine Inc.Bruce has a passion for entrepreneurship and making a positive difference in the world. He brings a wealth of experience in building strong technology driven companies, developing world class teams and positioning his companies to deliver exceptional customer value and service.In his newly appointed role as an Active Advisor, Bruce will serve as Executive Chairman with GAGE Cannabis Co., following completion of the acquisition of Innovations - GAGE is innovating and curating the highest quality cannabis experiences possible for patients in the state of Michigan and bringing internationally renowned brands to market.See Also: Green Rush Podcast: ELLO's Hershel Gerson Says The Average Cannabis Company Has 6 Months Of Cash Before They Run OutHe is Special Advisor with Better Choice Company - (BTTR) BTTR is an animal health and wellness cannabinoid company that acquired TruPet LLC, an online seller of ultra-premium, all-natural pet food, treats and supplements, with a special focus on freeze dried and dehydrated raw products. And Director with MindMed - MindMed is assembling a drug development pipeline of psychedelic inspired medicines planning or undertaking FDA trials.Bruce is also an Activist Investor with SLANG Worldwide Inc. (OTC: SLGWF) is a leading global cannabis consumer packaged goods company with a robust portfolio of renowned brands distributed across 2,600 stores in 12 U.S. states. And with OG DNA Genetics Inc. ("DNA") - DNA has built and curated a seasoned genetic library and developed proven standard operating procedures for genetic selection, breeding, and cultivation.He is the Founder and Former Chairman and CEO of Canopy Growth Corporation (CGC/WEED), Co-Chairman and past CEO of Martello Technologies, and Co?founder of Ruckify & Better Software.Links and mentions in the show * https://www.betterchoicecompany.com/ * https://vireohealth.com/ * https://gageusa.com/ * https://www.mindmed.co/ * https://www.canopygrowth.com/Links to the guest's company and social media accounts * Bruce's Website: https://www.brucelinton.com/ * MindMed Website: https://www.mindmed.co/ * MindMed's Twitter: https://twitter.com/mindmedco/ * MindMed's Instagram: https://www.instagram.com/mindmed_co/Show Credits:This episode was hosted by Lewis Goldberg of KCSA Strategic Communications.Special thanks to our Executive Producer Nick Opich and Program Director Shea Gunther.For cannabis and psychedelics content in Spanish, check out El Planteo.The preceding article is from one of our external contributors. It does not represent the opinion of Benzinga and has not been edited.See more from Benzinga * Martha Stewart Will Launch CBD Products For Animals: Here's What You Need To Know * The Historic Fontainebleau Hotel Takes On A New Decade, Welcoming A Cannabis Event For The First Time Ever * Is Drake The Next Superstar Of The Cannabis Industry?(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Cannabis stocks have not been immune to the market selloff. In fact, Canopy Growth Corp (NYSE:CGC) stock has lost two-thirds of its value in the past six months.Source: Shutterstock But while the outlook has gotten tougher for Canopy in recent months, it is still the best option for cannabis investors today. The rough patch for cannabis stocks may not have reached its low point just yet.But Canopy's management is making all the right moves to ensure the company is well-positioned for the eventual recovery.InvestorPlace - Stock Market News, Stock Advice & Trading TipsIn the meantime, Canopy has the strongest balance sheet of its peers. In addition, if the share price continues to decline, Canopy could be an appealing buyout target for minority investor Constellation Brands (NYSE:STZ, NYSE:STZ.B). Canopy Is Making the Right MovesLast year, Canopy fired founder and co-CEO Bruce Linton and replaced him with former Constellation CFO David Klein. Klein is a numbers guy. His first major actions since taking over as CEO demonstrates an aggressive strategy to help shore up the company's financial situation. * 10 of the Best Long-Term Stocks to Buy in a Bear Market Earlier this month, Canopy announced it is shutting down 3 million square feet of production capacity. It also laid off 500 employees and said it would be taking up to a $550 million charge. Following the announcement, Bank of America analyst Christopher Carey said the move was exactly the type of financial discipline he was hoping Klein would bring to the table."While we acknowledge wasteful past spending which preceded today, we think these cuts are the right move for long term, showing mgmt. has the wherewithal to do what is required to create a sustainable, profitable business," Carey says.Canopy has also established itself as an early market leader in Canada with roughly 25% share, according to Bank of America. That share may grow if Canopy's competitors start dropping like flies because of their balance sheets.At the same time, Canopy's conditional buyout of U.S. multi-state operator Acreage Holdings (OTCMKTS:ACRGF) has it well-positioned to take a similar first-mover advantage in the U.S. market should cannabis ever be legalized on a federal level. Canopy Has a Strong Balance SheetThe biggest selling point for CGC stock at this point may be the fact that is has the best balance sheet in the business. Canopy ended 2019 with 1.6 billion CAD in cash and cash equivalents, according to Bank of America. While many of its peers are ramping up debt at any cost to stay afloat, Canopy is actually paying down its debt.Last quarter, Canopy reported just 536 million CAD in long-term debt, down from 842 million CAD in March 2019. Canopy also reported 49% sales growth and just 34% growth in operating expenses. Carey says the capacity and staff cuts will significantly reduce Canopy's working capital drain in coming quarters, improving margins even further.Ultimately, Carey says Canopy will end up in a position of financial strength when the cannabis industry begins to recover."Overall we are favorable to Canopy's long-term prospects, as a leading balance sheet have allowed Canopy to scale both in Canada and abroad (specifically the US), at a faster clip than peers," Carey says. CCG Stock Has Downside ProtectionCanopy also has a major potential catalyst in its back pocket if the share price continues to fall. Constellation Brands took a 38% stake in Canopy for about $4 billion back in August 2018. Since that time, CGC stock is down more than 70%. But Constellation has replaced the Canopy CEO with its own former CFO. Klein is now making bold moves to improve the company's financial situation.I believe there is a distinct possibility Klein was assigned to the position of Canopy CEO to get the company's financial ducks in a row in preparation for a potential Constellation buyout. If Constellation loved taking a 38% stake for $4 billion, it could theoretically get the other 62% of the company today at a price in the $3.5 billion range.The further CGC stock falls during this downturn, the more appealing a buyout will look to Constellation. In that sense, CGC stock has a downside protection that other cannabis stocks do not have.Canopy has a market share lead in Canada and potentially in the U.S. It has a strong balance sheet and improving fundamentals. And it has a financial backer with deep pockets that could potentially buy out the stock at some point. While most of the cannabis group is reeling, CGC stock still looks like a solid long-term investment.Wayne Duggan has been a U.S. News & World Report Investing contributor since 2016 and is a staff writer at Benzinga, where he has written more than 7,000 articles. Mr. Duggan is the author of the book Beating Wall Street With Common Sense, which focuses on investing psychology and practical strategies to outperform the stock market. As of this writing, Wayne Duggan does not hold a position in any of the aforementioned securities. More From InvestorPlace * America's Richest ZIP Code Holds Wealth Gap Secret * 10 of the Best Long-Term Stocks to Buy in a Bear Market * 7 "Perfect 10" Healthcare Stocks to Buy Now * Where the FANG Stocks Sit in This Wild Market The post Canopy Growth Stock Is the Best Coronavirus Cannabis Play appeared first on InvestorPlace.
The selloff in the market and in Canopy Growth (NYSE:CGC) stock both continue. Markets plunged again earlier this week, and Canopy stock hasn't been immune to the selling pressure. Now, shares trade back where they did in 2017.Source: Jarretera / Shutterstock.com As I've argued over the past few weeks, investors need to keep their cool. This selloff has not been easy and certainly has not been fun. But over time, the economy and the markets will recover.In the meantime, however, the volatility is dispiriting. However, as I've told subscribers of my Cannabis Cash Weekly service, in these environments investors sometimes have to step back and let the chaos play out.InvestorPlace - Stock Market News, Stock Advice & Trading TipsTaking that step back, the opportunity in CGC stock becomes more clear. The long-term growth opportunity in cannabis is delayed -- not eliminated. Canopy is the industry's leader, and should remain so. In fact, it may emerge with an even stronger position. * 10 Stocks to Invest In for a Post-Coronavirus Whipsaw Canopy isn't going anywhere. This, too, shall pass -- and when it does, CGC stock will rally sharply. Canopy Cuts BackEven before panic gripped the markets, it was becoming increasingly clear that the cannabis industry was headed for a shakeout. And that shakeout is almost guaranteed at this point.In the sector as a whole, there is too much debt and too much capacity. Canopy chief executive officer David Klein made precisely that point in an interview on Feb. 14. "There's not a lot of market demand for cannabis production facilities," he told Yahoo! Finance. "There's a lot of capacity in Canada and no logical buyers."That capacity is why Canopy announced earlier this month that it was closing two facilities in British Columbia. Furthermore, a greenhouse project in Ontario also is being canceled. Canopy isn't throwing good money after bad.Wall Street largely cheered the move -- for good reason. It cuts Canopy's costs, and in turn, speeds its path toward profitability. It also keeps the company from participating in "race to the bottom" pricing in wholesale cannabis.It's also a decision many other cannabis companies won't be able to make. An Industry Shakeout LoomsCanopy can make that decision because of its fortress balance sheet. In 2018, Constellation Brands (NYSE:STZ,NYSE:STZ.B) invested some $4 billion into Canopy Growth.Much of that money has been spent. Canopy has made acquisitions, and spent heavily to build out production assets. In fact, it's clear in retrospect that previous management spent too much. That's a key reason why Constellation sent Klein -- formerly its chief financial officer -- to take the top spot at Canopy.However, Canopy still has a good chunk of that cash remaining. As of Dec. 31, the company had 2.3 billion CAD (about $1.6 billion) in cash on its balance sheet. With losses coming down and long-term debt of just 536 million CAD ($373 million), the company is in excellent financial shape.To put it simply, Canopy isn't going bankrupt -- but other producers will. There's a real chance the equity in Aurora Cannabis (NYSE:ACB) gets wiped out, one reason I've long recommended even cannabis bulls avoid that name. Moreover, MedMen Enterprises (OTCMKTS:MMNFF) had to call off its acquisition of PharmaCann -- likely due to financing worries. Its OTC stock price -- just 19 cents -- shows its desperate state.The news is just as bad, if not worse, for many smaller, private operators. Those companies don't have the cash to weather store closures or any short-term effects.Canopy, however, does. And that positions it well going forward. How CGC Stock Can BenefitCertainly, a worldwide pandemic is not how anyone hoped the cannabis industry would become more rational. But it's also likely that the response to the coronavirus from China simply will be the catalyst, not the cause. Given debt levels and overcapacity, many smaller operators were going to fail regardless.That said, Canopy would benefit either way. In fact, a recent transaction shows how. Last week, Canopy and TerrAscend (OTCMKTS:TRSSF) entered into a loan agreement. Canopy is lending TerrAscend 80.5 million CAD, backed by TerrAscend's assets.The loan has an interest rate of 6.1% annually over the next decade -- but that's not the prize. Canopy also received more than 17 million warrants to buy TerrAscend shares, most of them at an exercise price of 3.74 CAD per share.If TerrAscend, which currently trades below 2 CAD, posts a huge rally, Canopy will get its money back while also owning a nice chunk of the company at an attractive price.If it doesn't, though, Canopy has first claim on its assets, brands, and retail operations.This kind of savvy deal is what Klein was hired to make. And it highlights the opportunities Canopy will have for the next few years. The company can patiently wait out the upheaval in its industry, and pick its spots to make investments that can drive significant value.Of course, that's exactly what investors should be doing right now. As they do so, they should give at least a long look to Canopy Growth stock.Matthew McCall left Wall Street to actually help investors -- by getting them into the world's biggest, most revolutionary trends BEFORE anyone else. The power of being "first" gave Matt's readers the chance to bank +2,438% in Stamps.com (STMP), +1,523% in Ulta Beauty (ULTA) and +1,044% in Tesla (TSLA), just to name a few. Click here to see what Matt has up his sleeve now. Matt does not directly own the aforementioned securities. More From InvestorPlace * America's Richest ZIP Code Holds Wealth Gap Secret * 10 of the Best Long-Term Stocks to Buy in a Bear Market * 7 "Perfect 10" Healthcare Stocks to Buy Now * Where the FANG Stocks Sit in This Wild Market The post When the Smoke Clears, Canopy Growth Stock Will Be a Winner appeared first on InvestorPlace.
Marijuana should be avoided during the pandemic as users share marijuana joints, which may increase the spread of the virus.
Cannabis is an early-stage business and early stage businesses often must raise capital. Tilray (NASDAQ: TLRY) stock is no exception. But the timing and circumstances surrounding a stock offering can tell an investor a lot about a company.Source: Jarretera / Shutterstock.com Tilray recently opted to raise $90 million via a stock offering. Unfortunately, the timing and details of the offering may be a huge red flag for investors. The OfferingOn Friday, Mar. 13, Tilray announced it had priced a $90 million stock offering at $4.75. TLRY stock subsequently tanked and for good reason. There are plenty of things for investors to hate about this offering.InvestorPlace - Stock Market News, Stock Advice & Trading TipsFirst, let's start with the price. The $4.75 price represented a 30.3% discount to Thursday's closing price of $5.95. Offerings are almost always priced below market price as an incentive for investors to buy in, but a 30% discount is a bit extreme. Stocks often at least temporarily trade in line with their offering prices or lower, so it's no surprise that TLRY stock crashed down to around $3 on Monday.Second, the offering represented 37% ownership dilution for existing shareholders. In other words, investors now own 37% less of the company following the offering.Third, $90 million really isn't that much money for that large of a dilution. In fact, $90 million is well less than half the $219.1 million in net losses the company reported in the fourth quarter of 2019 alone. Timing Is CriticalFinally, in my opinion, the worst thing about this offering was the timing. Companies always want to raise capital from a position of strength, not weakness. This time last year, TLRY stock was trading at around $70 per share. As recently as last month, the stock was trading above $20. In fact, any other time in the history of the freaking stock would have been a better time to raise capital than right after we crashed into a bear market.The timing of this offering tells me one of two things. Tilray management is completely clueless about finances, which seems unlikely. Or Tilray is absolutely desperate for cash. There's no other reason why management would choose to dilute shareholders by 37% by selling shares at a 75% discount to their market price just a month ago to raise less than half of the cash it burned last quarter."While we understand the need to raise funds, we are surprised Tilray management would pretty much choose the worst of times to price the offering," Cantor Fitzgerald analyst Pablo Zuanic says.He's not exaggerating. The warrants plus share issuance of the offering will increase share count by 38 million. The same offering priced at around $70 per share one year ago could have easily raised more than $1 billion for Tilray. How to Play TLRY StockThe only rational explanation for this offering is that Tilray management had no choice. At this point, they must be desperate for cash. That's not the position any investor wants their company to be in when the global economy is staring down the barrel of a recession.And don't bet on Tilray being self-funded anytime soon."Because of the company's well below average realized net pricing, we are more skeptical about a path to positive [earnings before interest, taxes, depreciation and amortization] which combined with aggressive guidance, leaves room for disappointment," Zuanic says.He has a "neutral" rating and $4.90 price target for TLRY stock, but I don't know how. Following news of the offering, Zuanic cut his price target by 72% from $17.50. But I have a hard time believing the only thing standing between Tilray and success is $90 million.Unless the global economy takes a dramatic 180-degree turn, I'm guessing Tilray will go back to raising capital again by the end of the year and from an even more desperate position. I can't even imagine what the next offering will do to the stock.For now, the name of the game in the cannabis space is access to capital and healthy balance sheets. Every stock will struggle in this climate. But I recommend Canopy Growth Corp (NYSE: CGC) and its financial backer Constellation Brands (NYSE: STZ) as the top play in cannabis at this time.Wayne Duggan has been a U.S. News & World Report Investing contributor since 2016 and is a staff writer at Benzinga, where he has written more than 7,000 articles. Mr. Duggan is the author of the book "Beating Wall Street With Common Sense," which focuses on investing psychology and practical strategies to outperform the stock market. As of this writing, Wayne Duggan does not hold a position in any of the aforementioned securities. More From InvestorPlace * America's Richest ZIP Code Holds Wealth Gap Secret * 10 of the Best Long-Term Stocks to Buy in a Bear Market * 7 "Perfect 10" Healthcare Stocks to Buy Now * Where the FANG Stocks Sit in This Wild Market The post Tilray Is Flirting with Disaster appeared first on InvestorPlace.
As Americans faced seclusion due to the COVID-19 pandemic, shoppers in San Francisco had the option of stocking up on one popular product with a minimal amount of human interaction: Marijuana.
Are marijuana stocks on U.S. exchanges a good buy now? The marijuana industry gets a lot of hype, but look past the smoke and analyze pot stocks on their fundamentals and technicals.
At the World Health Organization media briefing held March 11, COVID-19 was officially declared a pandemic."This is not just a public health crisis, it is a crisis that will touch every sector," said Dr. Tedros Adhanom Ghebreyesus, WHO director-general, stated. "So every sector and every individual must be involved in the fight."Some cannabis companies have already been affected.Benzinga is covering every angle of how the coronavirus affects the financial world. For daily updates, sign up for our daily coronavirus newsletter.HEXO Postpones Filing Interim Financial Statements For Q2HEXO Corp. (NYSE: HEXO) said Tuesday it has not met the deadline for filing its interim financial statements for its fiscal second quarter because of several unexpected circumstances, such as having a huge impairment loss in the quarter, with the final amount still to be calculated.Until the filings are submitted, Hexo will hold a blackout on trading by directors, officers and remaining insiders of the company.It has, however, revealed some financial results for the quarter, including net revenue of $17 million, compared to $14.5 million in the previous quarter, and gross revenue of $23.8 million, versus $19.3 million in the first quarter.Canopy Growth Temporarily Closes Retail Locations In CanadaView more earnings on HEXOCanopy Growth (NYSE: CGC) announced Tuesday it has decided to temporarily stop operating all corporate-owned Tokyo Smoke and Tweed retail stores across Canada, respecting the advice provided by various health bodies concerning the COVID-19 outbreak."We have a responsibility to our employees, their families, and our communities to do our part to "flatten the curve" by limiting social interactions. For us, that means shifting our focus from retail to e-commerce," said David Klein, CEO, Canopy Growth.Lift & Co. Temporarily Lay Offs Part Of Workforce, Shuts Down Non-Profitable Sectors Lift & Co. Corp. (TSXV: LIFT) (OTC: LFCOF) reported Tuesday that it has temporarily stopped business activities of its non-profitable sectors and discharged some of its employees due to the coronavirus pandemic.This strategic move comes in an effort to save cash and long-term shareholder value amid the COVID-19 outbreak, the company said.Its Lift & Co. Expo and CannSell business will continue to operate as usual.New England Treatment Access Pauses Adult-Use Sales Massachusetts-based medical and recreational marijuana dispensary New England Treatment Access announced Monday that its Brookline store will be open only to medical patients starting March 16, and that adult-use sales will be temporarily paused.The decision comes in response to Governor Baker's executive order which forbids gatherings of more than 25 people.The company noted that all medical patient orders should be made through Reserve Ahead.See more from Benzinga * Tilray Analyst Cuts Price Target By 72% After Offering At 'The Worst Of Times' * Canopy Growth Signs CA.5M Loan Agreement With TerrAscend * Canopy Growth Analysts Back Closures, Layoffs: 'A Bold Move'(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Canopy Growth Corp. said Tuesday it is planning to close all of its corporate-owned retail stores temporarily starting at 5 p.m. local time as it works to combat the coronavirus that causes COVID-19. The Canadian cannabis market leader, based in Smith Falls, Ontario, said the decision was deemed best for its retail workers. "This is a big decision but it was also an easy one to make -- our retail teams are public-facing and have been serving an above-average volume of transactions in recent days," Chief Executive David Klein said in a statement. Cannabis companies have been reported a spike in demand for weed as more and more people are ordered to hunker down at home. The decision affects 23 stores in Newfoundland, Saskatchewan, and Manitoba as well as the Tweed Visitor Centre in Smiths Falls, ON. The company will continue to provide medical cannabis to patients through is online platform. Shares rose 2.2% premarket, but have fallen 78% in the last 12 months, while the ETFMG Alternative Harvest ETF has fallen 75% and the S&P 500 has fallen 15%.
Canopy Growth Corporation ("Canopy Growth" or the "Company") (TSX: WEED) (NYSE: CGC) has been monitoring the COVID-19 outbreak and paying close attention to the guidance given by public health bodies around the globe. Canopy Growth's leadership team has made the decision to temporarily close all corporate-owned Tokyo Smoke and Tweed retail locations across Canada, effective at 5:00 p.m. local time today, March 17.
Without much fanfare, Canopy Growth (CGC) finally launched cannabis infused beverages to the Canadian recreational market. New CEO David Klein is making the right moves for the company by launching beverages for the Tweed brand last week without any major press coverage. The Covid-19 impact to the cannabis sector is highly unknown, but the stock is quickly losing the downside risk here at $10.Cannabis BeveragesCanopy Growth started sending the Tweed Houndstooth & Soda drink to provincial boards and retailers back late last week. The products left their regional distribution center on March 11. So far, the company is only shipping a soda containing 2mg of THC and <1mg of CBD.The move is definitely just a small positive with Canopy Growth promising dozens of drinks available back when the Cannabis 2.0 market was legalized in December. The new CEO had to squelch the plans for massive distribution after taking over the business in January and figuring out that THC-infused beverages weren’t scaling correctly at high production levels.Canopy Growth didn’t release any details on when other beverages will be ready, but investors should have more confidence of those hitting shelves in the coming weeks and months. According to Deloitte, the cannabis-infused beverage business in Canada will amount to $529 million in sales. In addition, once rolled out to Canada, Canopy Growth can eventually look at global distribution with the help of Constellation Brands.Down To $10 With fear only ramping up due to the coronavirus, Canopy Growth stock has been hit hard, and is now only worth a market cap of $3.5 billion while the company still has a cash balance of $1.6 billion.The global cannabis leader still has plenty of issues with burning cash on a quarterly basis, but it has started taking drastic steps to reduce costs including the recent closing of several cultivation facilities to reduce cannabis output. The market will find the stock far more appealing as the new CEO reduces those quarterly EBITDA losses in the C$90 million range to something lower than C$50 million.In the last quarter, Canopy Growth cut millions from quarterly operating expenses, but the company still spent C$150 million in operating expenses during the quarter. Investors have to hope the company is able to strip C$10 million from those expense levels on a quarterly basis without impacting production such as the expected ramp up in beverages. As mentioned before, Canopy Growth spent C$38 million in adjusted EBITDA in the last quarter alone on business development costs that should be quickly stripped out when a segment can’t turn into one generating sales in the near term.Wall Street VerdictUltimately, Wall Street is just not sure yet about the cannabis giant, but the optimists still win out in the bigger picture. Out of 13 analysts polled in the past 3 months, 6 rate CGC a "buy," 6 issue a "hold," and only one says "sell." The 12-month average price target notably stands at $21.28, marking a healthy return potential of 106% for new investors. (See Canopy Growth stock analysis on TipRanks)TakeawayThe key investor takeaway is that Canopy Growth is finally making the moves to position the Canadian cannabis LP to survive and thrive in the global cannabis market. When the market panic is over as the coronavirus panic subsides in a few weeks, the stock actually has decent value in the $10 range and a market valuation down to only $3.5 billion. The global cannabis opportunity of up to $200 billion hasn’t changed making the cannabis stocks that will survive very appealing here. 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.
SMITHS FALLS, ON , March 16, 2020 /CNW/ - Since Cannabis 2.0 legalization on October 17, 2019 , Tweed has been preparing for the launch of our cannabis infused beverages to the Canadian recreational market. Today, we are pleased to announce that our first SKU, Tweed Houndstooth & Soda, began shipping to provincial boards and retailers nationwide late last week. When and where will Tweed Ready-To-Drink cans be available for purchase?
Storz & Bickel, a cannabis vaporization technology company owned by Canopy Growth Corp (NYSE: CGC), has launched a new web-based, Bluetooth-enabled app, which allows iOS and Android users to regain remote control of their vaping experience.Once again, iPhone and Android users can accurately control the set and boost mode temperatures of their Crafty and Crafty+ devices from their phones, while Volcano Hybrid owners can adjust both temperature and airflow. More features will be rolled out soon.Overcoming Restrictions Since Apple Inc. (NASDAQ: AAPL) decided to ban all vaping apps from its platform - including apps from legitimate cannabis vape manufactures like Canopy Growth and PAX, iPhone users have lost access to app-enabled remote control features. However, Storz & Bickel has finally come up with a workaround.The brand's new web app automatically looks to connect to a Bluetooth device when loaded. "Storz & Bickel rolled out the first electronically controlled vaporizer in 2007 and has continued to lead the category in innovation ever since," Peter Popplewell, managing director of Storz & Bickel, told Benzinga. "We're excited to be the first vape brand to provide an innovative workaround that returns functionality of the app to consumers adversely impacted by the app ban."See more from Benzinga * The Week In Cannabis: Coronavirus Concerns, Moves In UK And Mexico, Tilray Earnings, Canopy Growth Cuts * Seth Rogen And Evan Goldberg's Houseplant Launches In Alberta, Canada * The Week In Cannabis: A Bunch Of Earnings And Policy Moves Around The World(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
In an industry known for its green hue, investors hoped that the cannabis market would be spared the red ink. Unfortunately, this didn't pan out. Instead, a huge drop in the benchmark indices on Wednesday relegated almost every publicly traded company into the doldrums, including sector leader Canopy Growth (NYSE:CGC). During the bloodbath, CGC stock dropped nearly 6%.Source: Shutterstock One of the biggest contributors to the fallout was the World Health Organization declaring the coronavirus from China a pandemic. Not helping matters is growing perception that, until recently, President Donald Trump's administration was not handling the situation seriously. Recently, the number of cases in the U.S. exceeded the 1,000 mark. And in all, the worldwide cumulative total is nearly 126,000 cases at time of writing. Supply Chain IssuesIntuitively, these matters don't appear to impact CGC stock. However, Wall Street is worried that community panic could effectively quarantine retail sentiment -- impeding discretionary purchases like cannabis. Furthermore, the coronavirus headwind on Chinese supply chains represent a direct hindrance on the legal marijuana industry.InvestorPlace - Stock Market News, Stock Advice & Trading TipsFirst, most cannabis-specific vaporizer products are manufactured in China. As you know, vaporizers are among the platforms that are featured in the so-called "Cannabis 2.0" rollout in Canada. So a disruption in this category will be a repeat of the supply chain woes when the country first went green. * The 10 Best Stocks to Buy After The Market's Historic Sell-Off Second, the widespread panic has dramatically reduced inventory of protective masks and gloves. Obviously, this presents problems to production workers. Companies like 3M (NYSE:MMM) and DuPont (NYSE:DD) promised to boost productions, but the immediate chokehold could hurt for a while.Finally, even mundane aspects of the business such as packaging risks disruption. And with China making almost everything you can think of, CGC stock subsequently took a beating. A Pivotal Geopolitical Discussion May Help CGC StockGiven the extremely negative response in the markets, some readers may wonder if my expectations for the longer-term picture has changed. Furthermore, others may ask if the thesis for CGC stock has been irreparably damaged.However, my answer to both questions is a firm no.Regarding the coronavirus, neither I nor anyone with whom I work with are downplaying the seriousness of this outbreak. But we must all realize that throughout American history, devastating diseases have plagued our communities. At best (or at worst), they impose minimal or transient disruptions. And I expect the same here.As far as CGC stock is concerned, Canopy Growth is the segment leader. As a still-young market, we will see growing pains knock out many competitors. Typically, though, growing pains don't permanently incapacitate the best and the brightest.But in further analyzing the present market dynamic, one unavoidable factor has arisen: our -- and the global economy's -- dependence on China.Although the international community has robust trade relations with China, politics and national security interests have clashed. Back home, government officials from all sides of the ideological spectrum have raised alarms about China's expansionary efforts. And with so many industries -- and subsegments within those industries -- are tied to the nation, it's inevitable that the global community is seeking paths of diversification.Over the long run, cannabis has the potential to explode higher as a largely North American economic engine of mutually beneficial interest. Additionally, the U.S. and Canada have forged an unbreakable friendship over the centuries.Considering that cannabis is a massive job creator, the idea of U.S. full legalization has likely inched a bit closer to fruition. After all, being dependent on Canada is a much more palatable concept. Food for ThoughtLast December, the Trump administration proposed a plan to allow states to import prescription drugs from Canada in an attempt to lower drug costs. Ultimately, industry trade groups from both nations opposed the plan. For the Canadians, they worried that the proposal would hurt supplies for their own citizens.Today, Americans are rapidly waking up to that reality.Of course, any plan to create alternative supply chains will experience severe difficulty. China doesn't just control specific drug supplies, but a wide range of them, including over-the-counter meds.With so much in China's hands, policy makers will likely consider not only relaxing cannabis restrictions, but encouraging their development -- particularly for cannabis-based medicines and therapies. So from both an economic and scientific perspective, cannabis really is a homegrown, viable catalyst.This won't just be a net positive for CGC stock, too. Rather, it could foster a long-term revenue source unencumbered by geopolitical tensions; Something that we urgently need.Matthew McCall left Wall Street to actually help investors -- by getting them into the world's biggest, most revolutionary trends BEFORE anyone else. The power of being "first" gave Matt's readers the chance to bank +2,438% in Stamps.com (STMP), +1,523% in Ulta Beauty (ULTA) and +1,044% in Tesla (TSLA), just to name a few. Click here to see what Matt has up his sleeve now. Matt does not directly own the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * The 10 Best Stocks to Buy After The Market's Historic Sell-Off * 9 Gold Stocks to Stave Off Coronavirus-Induced Volatility * 7 Stocks to Buy After International Women's Day The post The Coronavirus Forces an Interesting Narrative for CGC Stock appeared first on InvestorPlace.
Recreational-use cannabis is the primary source of Canopy Growth's revenue, but international medical-use cannabis is growing fast.
Canopy Growth Corp. said Wednesday it has entered a loan financing agreement with TerrAscend Corp. for C$80.5 million ($58.8 million). As part of the deal, TerrAscend has issued 17.8 million warrants to purchase common stock. Canopy, the Canadian cannabis market leader, initially invested in TerrAscend in November 2017. Proceeds of the deal will be used to finance Canadian operations, its Arise Bioscience U.S. hemp division, international expansion, to repay debt and for general corporate purposes. Canopy shares were down 1.3% premarket and have fallen 69% in the last 12 months, while the ETFMG Alternative Harvest ETF has fallen 67% and the S&P 500 has gained 4%.
Canopy Growth Corporation ("Canopy Growth" or the "Company") (TSX:WEED, NYSE:CGC) and TerrAscend Canada Inc. ("TerrAscend Canada"), a wholly owned subsidiary of TerrAscend Corp. ("TerrAscend") (CSE:TER, OTCQX: TRSSF), today announced they have entered into a loan financing arrangement in the amount of C$80.5 million (the "Loan") pursuant to a secured debenture (the "Debenture"). In connection with the Loan, TerrAscend has issued 17,808,975 common share purchase warrants to the Company (the "Warrants").
You might think the cannabis business would go untouched by the coronavirus as people stay home and look for ways to allay anxiety. But there could be problems.
After less than two months on the job, new Canopy Growth (CGC) CEO is making the right moves for the company. The Canadian cannabis LP hasn’t been a favorite in the sector due to bad leadership with out of control spending and production levels in the past. Now, CEO Davie Klein is making smart moves to mothball greenhouses to remove costs from the business and cut excess production making the stock more investable for the long term. The coronavirus can impact revenues in the short term, but the stock selloff to $13 more than accounts for this risk.Closing GreenhousesCanopy Growth made the decision to close two massive greenhouses in British Columbia and eliminate 500 jobs in the process. Also, the Canadian cannabis company isn’t going to not open a third greenhouse in Ontario.The Aldergrove and Delta, British Columbia greenhouses had ~3 million square feet of licensed production space and were placed into commission back in early 2018 at an estimated cost of C$400 million. In addition, Canopy Growth is taking up to a C$800 million pre-tax charge in the current quarter.The charge isn’t meaningful as anybody should know a company with results missing targets are going to need to write down assets. The important part of the story is the assets moved out of production with Canaccord Genuity’s Matt Bottomley estimating these greenhouses remove ~40% of the company’s Canadian footprint from production.In the past couple of quarters, Canopy Growth had produced more than double their actual sales leading to their inventory balance ballooning to C$623 million, up C$363 million in the last two quarters alone. The big unknown from the announcement was were quarterly cultivation capacity will end up after these greenhouse closings and where the company is going with the suggestion of shifting more production to outdoor sites.Improving Cash FlowsThe stock is now down to $13 more due to the coronavirus issue as the market wanted Canopy Growth to reduce production levels. Without the 2,000-point drop in the U.S. DJIA, the stock might not even be down based on the news.In the first three quarters of FY20 ending in March, Canopy Growth has burned C$548 million in cash from operations, which include building of those substantial inventories. These moves will strip out the excessive cost of building inventory, but the company will still need to cut millions from quarterly operating expenses still in the C$150 million range starting the March quarter.The good news is that new CEO Davie Klein appears ready to make the tough decisions to wipe out the wasted spending causing Canopy Growth to burn C$38 million in adjusted EBITDA in the last quarter alone on business development costs. The company has a lot of low hanging fruit to eliminate in order to bring the cash burn down to more acceptable levels.Consensus VerdictCautious optimism circles this cannabis player, as TipRanks analytics exhibit CGC as a Buy. Out of 13 analysts polled by TipRanks in the last 3 months, 6 are bullish on Canopy Growth stock, 6 remain sidelined, and one is bearish on the stock. With a return potential of nearly 63%, the stock’s consensus target price stands at $21.56. (See Canopy Growth's price targets and analyst ratings on TipRanks)TakeawayThe key investor takeaway is that Canopy Growth is finally making the tough decisions to position the Canadian cannabis LP to survive and thrive in the global cannabis market. When the market panic over the coronavirus subsides, the stock actually has decent value in the $13 range and a market valuation down to only $4 billion. With their market leading position in the cannabis market and a CEO willing to make the tough decisions, Canopy Growth is finally investable.To find good ideas for cannabis stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy.
Canopy Growth stock has been praised by many analysts. Here’s what chart analysis shows about buying this marijuana stock right now.