|Bid||2.6700 x 2900|
|Ask||2.9100 x 3200|
|Day's Range||2.6800 - 3.0100|
|52 Week Range||2.2800 - 8.4000|
|Beta (3Y Monthly)||4.68|
|PE Ratio (TTM)||N/A|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||N/A|
Canadian cannabis company Hexo is launching an “Original Stash” cannabis line with prices that compete directly with the black market in an effort to hurt the black market. Yahoo Finance's Dan Roberts, Heidi Chung and Kristin Myers discuss on YFi AM.
Bragar Eagel & Squire, P.C. is investigating potential claims against HEXO Corp. on behalf of HEXO investors. Our investigation concerns whether HEXO has violated the federal securities laws and/or engaged in other unlawful business practices.
Canadian cannabis companies should be celebrating the first anniversary of legalized weed on Thursday, but the party atmosphere has been tainted by a sharp three-month selloff that has seen many companies surrender half their value or more.
Class-action law firm urges HEXO investors who have suffered losses to submit your loss now to learn if they qualify to recover their investment losses. SAN FRANCISCO, Oct. 17, 2019 (GLOBE NEWSWIRE) -- Hagens Berman reminds investors in HEXO Corp. (HEXO) of the firm’s investigation of possible violations of federal securities laws and urges HEXO investors who have suffered significant losses to contact the firm. The investigation centers on whether HEXO misled investors about the propriety of its business model, including the ability to sell its cannabis through retailers.
Some say that history repeats itself, and while that is sometimes true, it's never a guarantee. And when it comes to the crash in Canopy Growth (NYSE:CGC) that doesn't mean buying CGC now will lead to impressive gains again in the future.Source: Shutterstock As I wrote last month in an article on Canopy Growth for InvestorPlace, a conversation regarding cannabis stocks wouldn't be complete without shares of CGC. And along with the continued shrinking fortunes of this once very green market, the industry's largest player has also been stinking up the joint.Blame that on whatever you think. But some finger pointing for CGC stock's continued slide in shareholder value could be rightfully directed at peer Hexo (NYSE:HEXO), which announced an awful revenue warning and guidance retraction a week ago. And of course fatalities tied to vaping have been regular headline news since August and much to the detriment of the cannabis market.InvestorPlace - Stock Market News, Stock Advice & Trading TipsUnlike the infamous Dot.bomb tech crash and today's market-leading innovators -- Apple (NASDAQ:AAPL), Amazon (NASDAQ:AMZN) or Netflix (NASDAQ:NFLX) -- the cannabis market in 2019 can't claim to have any companies of that caliber at bargain-bin prices. And that goes for CGC stock too. At the end of the day, it's a commodity and one currently suffering from a lot of product and overall weak demand.That's not to say there isn't great potential for growth. According to investment bank Stifel & Co. legal cannabis could be worth $200 billion over the next ten years versus a market worth less than $11 billion in 2018. And movement towards that end is underway. For one, edibles are legal as of today in the Canadian market. Canopy Growth stock also just landed the U.K.'s first medical cannabis bulk import license. * The 10 Best Mutual Funds for Your 401k Positive developments like those happening in CGC right now are victories. But to be clear, there remains an incredible amount of push-back and red tape from most regulators which CGC and the cannabis industry need to get past. And in our estimation it's going to take much longer than most anxious investors already exposed to the group dare to fathom. CGC Stock Monthly ChartIf you're going to believe in the cannabis market and CGC at this point in time, the monthly chart is a good place to assess those prospects. On this longer-term perspective, Canopy's five years as a publicly-traded company are fully captured and we can see both the hype and the damage to CGC stock price.Currently and after a pair of potential double bottom patterns from approximately $23 - $26 failed to be confirmed around the 62% retracement level, shares of CGC are in a testing position of the 76% Fibonacci level. With Canopy Growth stock's stochastics oversold and nearing a bullish crossover signal, the combination is something for bullish investors to monitor. But I'd warn against jumping into shares today and buying CGC as a core longer-term holding.The fact is many technicians agree the 76% level is a less important technical support and stocks are more likely to revisit the low of the cycle after a failure of the more formidable 62% level. In this instance, the breakdown could take shares of CGC down toward $5 and 2017's bottom, which marked the low after shares enjoyed their first whiff of success. * 7 Restaurant Stocks to Leave on Your Plate Ultimately, given the failures and uneven environment off and on the price chart of CGC stock, I'd recommend investors wait for price confirmation on the monthly perspective. That could be as simple as CGC shares forming a bottoming candlestick over the next couple weeks and then (at the moment) trading above the October high of $23.75 in November. Then again, investing successfully in CGC may not prove to be nearly that easy of a task.Disclosure: Investment accounts under Christopher Tyler's management do not currently own positions in any securities mentioned in this article. The information offered is based upon Christopher Tyler's observations and strictly intended for educational purposes only; the use of which is the responsibility of the individual. For additional options-based strategies and related musings, follow Chris on Twitter @Options_CAT and StockTwits. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * The 7 Best Penny Stocks to Buy * 7 Bank Stocks to Avoid Now at All Costs * The 10 Best Mutual Funds for Your 401k The post Stay Far Away From Canopy Growth Stock … For Now appeared first on InvestorPlace.
NEW YORK, Oct. 17, 2019 -- Pomerantz LLP is investigating claims on behalf of investors of HEXO Corporation (“HEXO” or the “Company”) (NYSE: HEXO). Such investors are advised.
NEW YORK, NY / ACCESSWIRE / October 17, 2019 / Bronstein, Gewirtz & Grossman, LLC is investigating potential claims on behalf of purchasers of HEXO Corp. ("HEXO" or the "Company") (NYSE:HEXO). ...
As the Canadian cannabis market undergoes growing pains, the industry stocks have taken a beating. The majority of the stocks in the sector are down over 50% as industry demand remains weak due to a lack of retail stores and a mounting flood of supply pressuring prices.Seaport Global analyst Brett Hundley recently reset expectations for the cannabis sector. Hundley is generally neutral on all of the Canadian stocks due to expectations of substantial revenue cuts with a more bullish view of the U.S. multi-state operator market.A major sign of his bearish view was the maintaining of a Buy rating on Aphria while lowering the price target from $13 to only $8. All of the other stocks in his coverage have Neutral ratings including updated numbers on Aurora Cannabis and HEXO after the later company recently slashed estimates and pulled guidance for FY20.We’ve delved into these three cannabis companies poised to struggle from low demand in Canada primarily due to a lack of retail stores all the way into 2021:Aurora Cannabis (ACB) Hundley makes big hits to the expectations for Aurora Cannabis in FY20 and FY21. The major basis for holding these large cannabis stocks was a concept of revenues reaching C$1 billion in the next year or so, but the analyst no longer thinks that is the case.In fact, Hundley is now far below consensus. The analyst reduced FY20 revenue estimates from C$589 million to only C$391 million. The new FY21 target was slashed by more than 50% with revenues dipping from C$992 million to only C$410 million. The forecast is that revenues only grow 5% during FY21.The resulting impact is that Aurora Cannabis doesn’t even reach profitability in FY21 despite the original guidance from the company of reaching that target in FQ4’19. Hundley now has the company producing an adjusted EBITDA loss of C$35 million in FY21.The stock still has a market valuation approaching $4 billion which is relatively expensive for a company with revenue estimates from Hundley of only $311 million in an out year. Stocks don’t usually maintain +10x sales valuations while losing money in a slow growth environment. Based on these estimates, Aurora Cannabis should have a Sell rating.TipRanks indicates Wall Street is evenly split between the bulls and the fence sitters on this cannabis stock. Out of 15 analysts polled in the last 3 months, 6 are bullish on Aurora stock, 6 remain sidelined, while 3 are bearish on the stock. Yet, consider that the 12-month average price target of $6.83 reflects healthy upside potential of nearly 90% from where the stock is currently trading; in other words, optimism circulates among analyst sentiment even amid apprehension. (See Aurora stock analysis on TipRanks)HEXO Corp. (HEXO)HEXO was a clear-cut case for estimate reductions after the company slashed last quarter estimates and pulled full year guidance. Hundley slashed revenue estimates for the next couple of years to factor in near zero growth.The analyst has HEXO only generating FY21 revenues of C$122 million, down from previous estimates of C$613 million. The company is now forecast to have breakeven adjusted EBITDA next fiscal year.The lack of guidance from HEXO and the quick departure of the CFO leave the numbers near impossible to model. Based on a market valuation of $660 million, the stock is far too expensive for the numbers outlined by Hundley.My expectations would be for the company to exceed these lowered estimates, but the stock isn’t touchable until more confidence exists in the ability of HEXO to operate in the current competitive market in Canada.The company needs to double or triple these revenue estimates from Hundley to make the stock a buy here. Investors have no reason to touch the stock here.Wall Street believes Hundley is smart to play it safe when it comes to the HEXO's prospects ahead, as TipRanks analytics reveal the stock as a Hold. Out of 10 analysts polled in the last 3 months, 7 remain cautious on HEXO stock, 2 are bullish, and one is bearish on the stock. However, the $4.46 price target suggests a potential of over 80% from the current share price. Most likely a result of the sudden tumble and analysts’ inability to turnaround new price targets so quickly. (See HEXO stock analysis on TipRanks)Aphria (APHA)Hundley was most bullish on Aphria in the Canadian cannabis sector despite a massive cut to the price target. The analyst had actually modeled revenues to C$131 million in the FQ1 just reported and the company didn’t even reach this target reporting C$126 million.A lot of the revenue miss came from a switch in the German operations to improve profitability, so the overall analyst estimates weren’t cut in an update. The other estimates by analyst Brett Hundley appear far too bearish as acknowledged by the analyst, yet the one comparison already in the market was too high.The new number already had Aphria seeing FY21 revenues dip to C$593 million, down from C$973 million. The analysts now has revenues estimates for FY21 at C$596 million so he has slightly more confidence in Aphria after the FQ1’20 report.Possibly most interesting was the company maintaining FY20 revenue guidance of at least C$650 million while Hundley reduced targets to only C$546 million. A wide gap now exists between where the analyst maintained estimates and the updated guidance from the company.The biggest positive for Aphria is the expectation of generating positive EBITDA as liquidity could become a major problem in the sector. The ability to generate cash from operations and over C$400 million on the balance sheet will help Aphria survive any further market pressure.The stock soared on the basis of maintaining revenue estimates for the year while Seaport is predicting limited growth despite the company having over 5 months of Cannabis 2.0 to contribute to the FY20 results. Aphria is only trading up to $5.50 on the market perception of positive results so Hundley still sees plenty of upside on the stock.If we step back and look at the bigger picture, we can see that overall the stock has a ‘Moderate Buy’ analyst consensus rating. In the last three months, the stock has received 5 "buy" ratings and just one "hold" and one "Sell" ratings. With an average analyst price target of $8.20, analysts are projecting upside potential of 64% from the current share price. (See Aphria stock analysis on TipRanks)
HEXO Corp (TSX:HEXO)(NYSE: HEXO) announced Wednesday the launch of its new value brand Original Stash. The idea behind starting this brand is to confront and beat the illicit market. Hexo said the latest Statistics Canada’s National Cannabis Survey revealed more than 40% of Canadians buy cannabis from illegal markets mostly because of more affordable prices.
Aphria Inc.’s profits are about the paper, not the pot. The Canadian cannabis producer reported its second consecutive quarter of profitability early Tuesday, posting net income of C$16.4 million on sales of C$126.1 million. U.S.-traded shares of Aphria (APHA)(CA:APHA) closed Tuesday’s regular session with a 24% gain, but had previously fallen just over 6% in the quarter it reported Tuesday.
Hexo Corp. unveiled Wednesday its value cannabis brand Original Stash, which the Canada-based company said is priced at "black market prices." The company said adult-use consumers can buy 28 grams, or one ounce, of Original flash dried flower for C$125.70 ($95.11) including taxes, or the equivalent of C$4.49 a gram ($3.40). The first Original Stash product is OS.210, offered as a hybrid sativa dried flower blend at 12% to 18% THC, which will be available in retail stores on Oct. 17. "Our aim with Original Stash is to disrupt the illicit market, educate consumers about the value of a regulated and tested product, and drive them to purchase their cannabis legally," said Hexo Chief Executive Sebastien St-Louis. Hexo's stock has tumbled 49% over the past three months, while the ETFMG Alternative Harvest ETF has tumbled 35% and the S&P 500 has eased 0.3%.
GATINEAU, Quebec, Oct. 16, 2019 -- According to Statistics Canada’s latest National Cannabis Survey (published on August 15, 2019), almost half—over 40%—of Canadians continue.
Boom and bust cycles can easily last a few years. A classic case is the dot-com cycle, when lasted from 1998 to 2000, giving investors time to snag juicy returns.But cannabis stocks have been different. Their boom-bust cycle only lasted a year or so. And it is far from clear if marijuana stocks have bottomed.Source: Shutterstock The silver lining is that the valuations of marijuana stocks have become much more attractive, while their growth outlook appears to be intact.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 10 Hot Stocks Staging Huge Reversals There are a variety of high-quality marijuana stocks that investors can consider buying. But let's take a look at one: Aurora Cannabis (NYSE:ACB).Granted, the chart of ACB stock is downright scary. During the past year, Aurora Cannabis stock has gone from $12 to $3.77.While the valuation of ACB stock is still far from cheap, its growth remains particularly strong. Ultimately, that should lead to higher margins and profits, which will make Aurora stock more attractive. The Pros of ACB StockAurora has operations across 25 countries on five continents. Besides a thriving consumer business, ACB also has an extensive medical operation, as it employs more than 40 highly educated researchers, and has conducted a long list of clinical trials and case studies. What's more, the company is making a big play for the CBD-based wellness category, which is likely to become a multi-billion dollar business in the US. The Cons of ACB StockIt's true that ACB stock is facing a great deal of risk. The Canadian cannabis market has been beset with difficulties, as its supply chain has been problematic and it's been hurt by the continuing strength of the black market. Additionally, Hexo's (NYSE:HEXO) negative earnings preannouncement was a sign that the cannabis sector's growth may be decelerating.Moreover, vaping may have caused a number of deaths. While the ultimate cause of the deaths is unclear, they have damaged the cannabis industry's image. The Bottom Line on Aurora Cannabis StockAll in all, these are serious problems, and it will take some time to deal with them. But then again, Wall Street has been factoring all this into ACB stock. So even a small amount of good news could easily spark a rally by Aurora stock.But it's important to keep in mind that there are some potential catalysts that can help get ACB stock back on track. One is Cannabis 2.0. This refers to the legalization of CBD edibles, topicals and beverages in Canada. According to Deloitte, those products could generate $2.7 billion of revenue.Next, ACB has a top-notch strategic advisor, the legendary Nelson Peltz. He runs an activist investment fund and has taken positions in companies like Procter & Gamble (NYSE:PG), Mondelez (NASDAQ:MDLZ), and Wendy's (NASDAQ:WEN). No doubt, he'll be able to leverage his own network to identify strategic partners and investors.Granted, despite all this, ACB stock will likely remain volatile. So it's probably best to refrain from buying too many shares of Aurora stock initially. But in the long-term, ACB does look like it has what it takes to be a winner.Tom Taulli is the author of the book, Artificial Intelligence Basics: A Non-Technical Introduction. Follow him on Twitter at @ttaulli. As of this writing, he did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Hot Stocks Staging Huge Reversals * 7 Under-The-Radar Growth Stocks That Could Benefit New Investors * 5 Excellent High-Yield Dividend Stocks to Buy The post Aurora Cannabis Stock: It's Not Time to Throw in the Towel appeared first on InvestorPlace.
Hexo Corp. shares took another bath on Monday, after Seaport Global downgraded the stock along with market leader Canopy Growth, in a note that advises investors to switch out of Canadian cannabis stocks and into U.S. multistate operators.
Aurora Cannabis (NYSE:ACB) stock continues to tumble. Shares have fallen from around $6 in early September to $3.68 at the close Oct. 11. Terrible results from its competitors have impacted ACB stock.Source: Shutterstock Hexo's (NYSE:HEXO) preliminary results could be the canary in the coalmine. The cannabisphere is waiting on December's rollout of derivative products to provide a sales boost. But what happens if this too is a bust?With this in mind, it's easy to say Aurora stock could fall further. Valuation remains high. But a speckle of good news could shoot shares higher. Let's take a closer look, and see what's the call on ACB stock today.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Recent News with ACB StockAfter the Hexo report, analysts are taking a harder look at the pot industry's future prospects. But Jeffries' Owen Bennett remains positive on the stock. Bennett sees Aurora as one of the stronger cannabis companies, likely to survive the maelstrom. * 7 Beverage Stocks to Buy Now Their strategic relationship with investor Nelson Peltz remains a key positive. The potential of them entering the U.S. market remains a catalyst to drive shares higher.Bennett's key concern is the upcoming convertible debt maturity. $230 Canadian million dollars worth of notes come due in March 2020. Given that the current share price is far below the conversion price, Aurora needs to raise more capital to retire the debt. In other words, the potential for more share dilution. While this dilution may not be material, is remains another negative for Aurora Cannabis stock.Another key question on investor's minds is "positive EBITDA." Aurora previously implied they were are on target to hit this milestone by Q4 FY19 (quarter ending June 30, 2019). But they backtracked this before releasing Q4 results. Their current preferred wording is "on track", without a defined date.Aurora management continued with this on the last conference call, dancing around a target date for positive EBITDA.Analyst consensus sees revenue rising from $438.3 million for the period ending Jun 2020 to $775.2 million for the period ending Jun 2021, but with excess inventory and falling average selling prices, is this achievable? Aurora's Upside Remains Priced InACB stock continues to sell at a high valuation. Aurora stock trades at an enterprise value/sales (EV/Sales) ratio of 21.3. This is a discount to peer Canopy Growth (NYSE:CGC), which trades at an EV/Sales of 28.1. But Aurora trades at a substantial premium to pot stocks like Aphria (NYSE:APHA). Aphria's EV/Sales is 6.5. Aurora trades in line with Hexo's current valuation (EV/Sales of 21.9).Aurora's potential growth is already priced into the share price. Even with shares trading below the $4 price level, ACB stock is no bargain. With skepticism over pot industry growth, could Aurora Cannabis stock fall further? The company next releases results in mid-November.Last quarter, the company narrowly missed revenue estimates ($75 million actual vs. $78.2 million projected). For this quarter, sales are estimated to be $79.4 million. If the company misses the mark again, there will be concrete doubts over the Aurora growth story.But what kinds of catalysts are in the pipeline? In prior analysis, I highlighted the company's European business. As seen from September's investor presentation, Aurora's big presence in Germany could pay off in the long-term. But, for now, European medical sales remain a small part of Aurora's business. European sales were just CAD$11.8 million out of CAD$281 million in total FY2019 sales.In the short-term, "Cannabis 2.0" is the biggest mover of Aurora stock. Canada is on track to allow sales of products like edibles in December. It remains to be seen if sales will meet expectations, or become another disappointment. Taking into account these potential catalysts, it appears that Aurora stock offers very little for investors. Bottom Line on ACB StockI am skeptical about Aurora's future prospects. The company stands at the cusp of opportunity. But so do scores of other publicly-traded pot stocks. The Canadian pot space got ahead of itself, ramping up production to levels that exceed demand.The roll-out of edibles and other derivative products could be a saving grace, but reality may not line up with expectations. At the current trading price, Aurora stock is far too expensive to justify a position.At the same time, Aurora is too risky a stock to short. A modicum of good news could send the depressed stock price higher. Aurora is the kind of stock you need to throw into the "too hard" pile. Look for clearer growth opportunities, and steer clear of ACB stock.As of this writing, Thomas Niel did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Beverage Stocks to Buy Now * 10 Groundbreaking Technologies Created by Universities * 5 Semiconductor Stocks Worth Your Time The post Sure, ACB Stock Is a Falling Knife, but It's Too Risky to Go Short appeared first on InvestorPlace.
It may sound like a familiar refrain, and it is, but cannabis equities are imperiled at the moment and Aurora Cannabis (NYSE:ACB) stock is not immune to that theme. Last week, shares of the Canadian medical marijuana grower plunged 16.36%, extending the stock's 12-month loss to over 63%.Some that tumble is attributable to Hexo (NYSE:HEXO), which slid after issuing slack revenue guidance. Hexo forecast fourth-quarter sales of $14.50 million to $16.50 million and full-year revenue to be between $46.50 million and $48.50 million. Basically, Hexo sneezed and other cannabis stocks caught colds last week.These days, there aren't places to hide in the cannabis space. It's either hold on tight or get out. There is no in between. Last Friday, Canopy Growth (NYSE:CGC) tumbled, dragging Aurora Cannabis stock and other rivals down with it after Jefferies downgraded Canopy.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 Beverage Stocks to Buy Now In a note, the Jefferies analysts said "that a number of negative headlines have impacted the sector in the past six months, as well as few signs of profitability. Still, they feel greater risk and volatility is priced in for many stocks," reports Connor Smith for Barron's.The Jefferies analysts added that the next 12 months will be pivotal for the fortunes of many cannabis companies as markets continue separating the winners from the losers. The analysts bring up a point I've frequently mentioned regarding marijuana companies: the ability to execute.Sure, there are some reasons to consider holding onto Aurora Cannabis stock, despite a dubious record of execution. Investors with high risk tolerance or the extremely patient that are waiting for increased liberalization of the Canadian recreational market and other fundamental factors can hold this name."Looking beyond Canada, forecasts suggest medical and recreational markets will continue to open up worldwide, providing ample opportunity for long-term growth if these companies can ramp up their supply quickly and build compelling brands," according to Bloomberg. ACB Stock Problems RemainAt last Friday's close of $3.68, Aurora Cannabis stock is cheap in price tag only. The shares still trade at a whopping 500x forward earnings. However, the company isn't profitable, though management is trying to get there."As a result of its focus on profitability, adjusted EBITDA losses narrowed to $12 million in the quarter, down from $37 million in the third quarter," said Morningstar. "Nonetheless, full-year adjusted EBITDA losses widened by $100 million versus 2018 to $156 million for the full year, reflecting higher overhead expenses to support growth."That's fine and dandy, but some channel checks suggest Aurora's inventories are increasing, indicating management didn't properly forecast demand. Remember that when the company reported fiscal fourth-quarter results last month, it said revenue was up in its medical and Canadian consumer businesses, but it also said "production volume increased 86% sequentially to 29,034 kgs."For Aurora Cannabis stock, two of the bright spots include a 3% margin on revenue increase to 58% and, perhaps more importantly, declining production costs. In the fiscal fourth quarter, "cash cost to produce per gram sold declined 20% sequentially to $1.14 per gram in Q4 2019," according to the company. Bottom Line: Making Good South of the BorderOne of the keys for Aurora Cannabis stock, though its more of a medium- to long-term story, is the company's ability to establish some hold in the fast-growing U.S. market. This is a reoccurring across the Canadian cannabis space and one investors must be mindful of.The company has some presence in the U.S. via a marketing deal with the Ultimate Fighting Championship (UFC), but as price action in Aurora Cannabis stock suggests, investors are demanding more.Aurora Chairman Michael Singer recently said Nelson Peltz, the activist investor that has a stake in the company, has been setting up meetings between the cannabis firm and potential U.S. partners.The company "lans to aggressively pursue the United States cannabis market with an acquisition in the hemp-derived CBD space as its likely first big play," according to CNN Business.Such a move could appease investors, but for Aurora Cannabis stock to move higher on acquisition news, the company cannot overpay for its target, and management must prove adept at realizing cost synergies and effectively integrate the acquired firm when the time comes. Bottom line: execution remains a critical part of the Aurora Cannabis stock narrative.Todd Shriber does not own any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Beverage Stocks to Buy Now * 10 Groundbreaking Technologies Created by Universities * 5 Semiconductor Stocks Worth Your Time The post Aurora Cannabis Flirts With Penny Stock Status appeared first on InvestorPlace.
Hexo (NYSE:HEXO) stock is crashing. In just two days, shares dropped from $4 to $2.53 with no signs of recovery at all. It may fall even farther. The entire cannabis sector is under pressure, but the performance of HEXO has been exceptionally bad.Source: Shutterstock There are some things going on here that are very interesting. Chief Financial Officer Mike Monahan recently resigned after just four months with the company. He said that he wanted to spend more time with his family and that the position required him to often be away from home.Sometimes the departure of a senior executive can be bad for a company's stock price. In the case of HEXO stock, in the following days after the announcement the stock only drifted marginally lower.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Hexo Withdraws Its OutlookThen the bombshell hit. On Oct. 10, HEXO announced that it would be withdrawing its previously issued financial outlook for 2020. This is what caused the stock to get crushed. Why is this so bad? It's because many investors believe the optics are terrible and that there could be serious issues with the company. * 10 Groundbreaking Technologies Created by Universities The story of Monahan's departure seems somewhat questionable. It's kind of hard to believe that a senior-level executive would accept a position without understanding how much time and travel would be required. Maybe this is true, or maybe he just couldn't get along with some of the other members of management. Regardless, I wish him all the best.After this, the company withdrew its earnings outlook. This is obviously a concern to investors because the perception is that, at best, there has been some very sloppy accounting at HEXO. At worst, some investors could believe it's an indication that Monahan saw something that he thought was unethical or illegal going on. This made him decide to cut his association with the company.I am not saying that this is what happened. It is entirely possible that Monahan's story is true and that there is a legitimate reason for withdrawing the outlook. It's the optics that are the problem. These actions have scared shareholders, or prior shareholders at this point, and this is what caused them to sell their stock so aggressively.Hexo will be reporting its annual results for fiscal 2019, which ended in June, on Oct. 24. I am looking forward to the conference call. This is when the management discusses the results and other issues. There will probably be serious questioning by angry shareholders that have lost a lot of money. A Look at HEXO StockAs recently as May, HEXO stock was trading above $8 a share. The most recent close was at $2.53. This was the lowest price of the day which means that there wasn't any rebound or recovery.At the time of this writing, Mark Putrino did not have any positions in the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Beverage Stocks to Buy Now * 10 Groundbreaking Technologies Created by Universities * 5 Semiconductor Stocks Worth Your Time The post HEXO Stock Has Crashed -- And It May Drop Even More appeared first on InvestorPlace.
MKM Partners analyst Bill Kirk cut his stock price target on Aurora Cannabis Inc. on Monday and said there is still some optimism in the stock “to shake and trim.
“We see a headwind for the Canadian cannabis market, ahead, based on sizable industry supply,” Seaport Global analyst Brett M. Hundley said.
The Internet boom certainly provides a pretty good metaphor for what's been happening to the cannabis space. In the early phases, the optimism was contagious (remember how adding a .com to a company name could greatly boost the stock value?). But markets can only propel the bullishness for so long. Eventually, there is a plunge, which can be brutal.Source: Jarretera / Shutterstock.com Unfortunately, when it comes cannabis stocks, we're in this stage right now.Now ultimately, I think there will be some huge winners - and yes, many operators that will simply be consolidated or go bust. This will accelerate as it gets more difficult to raise money.InvestorPlace - Stock Market News, Stock Advice & Trading TipsSo which cannabis stocks to focus on? Which ones will be the long-term winners? Well, Tilray (NASDAQ:TLRY) stock looks interesting. True, I have been negative on the company for some time. But given the much more attractive valuation, TLRY stock should get some consideration for a buy. * 10 Super Boring Stocks to Buy With Super Safe Returns The company has the advantage of having raised substantial amounts when the markets were bubbly (this was done primarily with convertible securities, which will likely not be turned into stock any time soon).Tilray also has diverse revenue sources, which span adult-use cannabis, food products and medical treatments. Oh, and it has been fairly disciplined with its spending and mergers and acquisitions deal-making: just take a look at its acquisition for Manitoba Harvest, which has been a nice catalyst for growth. Negative Sentiment Is Off the ChartsKeep in mind that - for the most part - it's hard to find many cannabis bulls anymore. Besides, when scanning through the headlines, it seems that a majority of analysts are negative.To get a sense of how extreme things are, look at what happened this week with the announcement of preliminary fourth-quarter earnings from HEXO (NYSE:HEXO). Unfortunately, it fell significantly below expectations (which, by the way, were already depressed).The company's Q4 forecast now calls for a range of 14.5 million CAD to 16.5 million CAD. As for the analysts' consensus, it was a much more robust $24.8 million. HEXO even withdrew its outlook for fiscal 2020 (it had previously forecasted revenues of 46.5 million CAD to 48.5 million CAD).On the news, the stock sunk by more than 22%. Investors also sold off many of the other top names in the sector. For example, Tilray stock dropped over 13% to $20.65, putting the year-to-date return at a miserable -71%. In fact, TLRY stock is not far off from its $17 initial public offering price (the company went public in July 2018).But there are really few signs of serious deterioration of Tilray's business. In the latest quarter, revenues soared by 371% to close to $46 million.True, the company continues to lose money. But this is expected as it needs to scale operations to keep up the growth ramp. Bottom Line on Tilray StockOf course, predicting a bottom is a dangerous business! After a major boom, the plunge can easily go to the extreme.So, with Tilray stock, it's probably best to average into a position, as the volatility will likely continue. What's more, there are a handful of other top-tier cannabis stocks, like Cronos Group (NASDAQ:CRON) and Canopy Growth (NYSE:CGC), that are worth considering as well.Again, as with the dot-com implosion that happened nearly 20 years ago, the best strategy then was to focus on the major brands like eBay (NASDAQ:EBAY) and Amazon.com (NASDAQ:AMZN). And I think the same is likely to be the case with today's cannabis stocks.Tom Taulli is the author of the book, Artificial Intelligence Basics: A Non-Technical Introduction. Follow him on Twitter at @ttaulli. As of this writing, he did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Super Boring Stocks to Buy With Super Safe Returns * 10 Winning Stocks to Buy and Stick With for the Long Haul * Don't Give Up on These 4 Cannabis Stocks The post Has Tilray Stock Finally Hit Rock-Bottom? appeared first on InvestorPlace.
(APHA) will be the first marijuana company to report quarterly earnings since last week’s cannabis stock selloff. Its fiscal first-quarter earnings announcement is scheduled for Tuesday, after the market closes. Aphria stock (ticker: APHA) is down about 17% so far this year through Friday’s close at $4.71, while the S&P 500 index has risen 19%.
Canadian cannabis producer Hexo (NYSE:HEXO) preannounced its Q4 earnings on Thursday. It reported that its Q4 revenue would be well below its previously issued guidance.Source: Shutterstock In addition, the company withdrew its fiscal 2020 outlook. HEXO was punished, tumbling 23.6% on Thursday. The company blamed issues in the Canadian cannabis market for the miss. Hexo's Q4 Guidance Slammed Tilray StockAs a result, multiple other marijuana stocks, including Tilray (NASDAQ:TLRY) stock, were slammed as investors reacted to the bad news. By the time the bell rang on Thursday, Tilray stock had plummeted 13.5% to $20.65. It rebounded slightly on Friday, climbing 1.5% to $20.96.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * Is Shopify (SHOP) Stock the Right Buy in E-Commerce Now? Tilray made statements that indicated that the Canadian cannabis market is having huge difficulties. That triggered panic by investors who were worried that Hexo's problems are a bad sign for other cannabis producers. Specifically, TLRY reported that:"Slower than expected store rollouts, a delay in government approval for cannabis derivative products and early signs of pricing pressure are being felt nationally. The delay in retail store openings in our major markets has meant that the access to a majority of the target customers has been limited. Additionally, regulatory uncertainty across the pan-Canadian system and jurisdictional decisions to limit the availability and types of cannabis derivative products have contributed to an increased level of unpredictability."Investors hate unpredictability, so that's worrisome for many marijuana stocks, including Tilray stock. Negative pressure on cannabis sales is not good news at a time when many producers, including TLRY, are struggling to become profitable.And the possibility that the coming rollout of edibles and other cannabis-infused products --slated to be legalized by Canada in December -- could be in trouble, is the last thing that the owners of TLRY stock and other cannabis names want to hear. Other Marijuana Stocks Were Also HitOther cannabis producers suffered significant stock price declines as the market reacted to Hexo's guidance. Canopy Growth (NYSE:CGC) sank 10.6%, Aphira (NYSE:APHA) lost 14.3%, Aurora (NYSE:ACB) dropped 9.5% and Chronos (NASDAQ:CRON) slid 7.2% on Thursday. Problems in the Canadian Cannabis MarketThe statement by Hexo is a stark reminder of the many challenges facing the Canadian cannabis market. Leadership shakeups, production and distribution challenges, and slow retail store rollouts are among the problems that have plagued the sector. Also dragging down marijuana stocks are lower than expected public demand for recreational marijuana and the black eye of a major producer losing its license after being caught growing pot illegally. As a result of all these negative catalysts, the Canadian recreational cannabis market has not been the gold mine many had hoped for.In the latest challenge facing marijuana stocks, sales of vaping products that incorporate cannabis extracts are now in jeopardy due to the CDC's investigation into lung injuries and deaths that may have been caused by vaping. Such vaping products are slated to be legalized by Canada in December.Most of the reported illnesses and deaths were caused by cannabis products that contain THC. Even if vape products with cannabis extracts aren't banned, the investigation is likely to scare off many potential buyers. The Outlook of Tilray StockConsidering that just over a year ago, TLRY stock hit $214.06, is it a buy after it closed on Friday at $20.96? The shares' performance has been underwhelming in 2019, with Tilray stock down nearly 72% in 2019.Most analysts have a "hold" rating on Tilray stock, and their median 12-month price target on TLRY is $52.00. But those numbers don't yet reflect Thursday's panic. It's likely that TLRY stock will bounce back from its HEXO-induced loss as cooler heads prevail, but the long-term outlook of this cannabis stock remains hazy. As of this writing, Brad Moon did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Super Boring Stocks to Buy With Super Safe Returns * 10 Winning Stocks to Buy and Stick With for the Long Haul * Don't Give Up on These 4 Cannabis Stocks The post Tilray Stock Hammered as Investors Turn on Cannabis Producers appeared first on InvestorPlace.
SAN FRANCISCO , Oct. 11, 2019 /PRNewswire/ -- Hagens Berman notifies HEXO Corp. (NYSE: HEXO) investors of the firm's investigation of possible violations of federal securities laws. The firm urges HEXO ...