|Bid||23.68 x 0|
|Ask||23.66 x 0|
|Day's Range||21.68 - 23.72|
|52 Week Range||12.96 - 47.94|
|Beta (5Y Monthly)||2.42|
|PE Ratio (TTM)||N/A|
|Earnings Date||Aug 10, 2020|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||22.94|
Canopy Growth (NYSE: CGC) and Aurora Cannabis (NYSE: ACB) are among the biggest names in the cannabis industry. It shouldn't be all that surprising to investors that Canopy Growth sees beverages as a key part of its strategy, given that beer maker Constellation Brands (NYSE: STZ) owns a 39% stake in the company.
Canopy Growth Corporation (CGC) closed at $16.02 in the latest trading session, marking a -1.9% move from the prior day.
Both cannabis markets are drawing attention. How are these two companies approaching these segments?
We know that hedge funds generate strong, risk-adjusted returns over the long run, which is why imitating the picks that they are collectively bullish on can be a profitable strategy for retail investors. With billions of dollars in assets, professional investors have to conduct complex analyses, spend many resources and use tools that are not […]
Today, I'll look at two of the top pot stocks in the industry -- Aphria (NASDAQ: APHA) and Canopy Growth (NYSE: CGC) -- and assess which of these leading cannabis producers is the better stock to hold in your portfolio. One of the ways Aphria has established itself as one of the safer stocks in the industry is by being able to stay in the black on a relatively consistent basis. In its most recent quarterly results, which the company released on April 14, Aphria posted a net income of 5.7 million Canadian dollars on net revenue of CA$144.4 million.
Will the potential of cannabis derivatives products push these two cannabis companies towards growth this year?
There's been some significant buyer's remorse of late in the cannabis industry, with would-be acquirers backing out of deals or amending them. It's not uncommon for such deals to change between the time they're proposed and the day they close, but the frequency at which that's happening in the cannabis industry is raising eyebrows among investors. On June 25, Canopy Growth (NYSE: CGC) and Acreage Holdings (OTC: ACRGF) agreed to change the terms of their deal.
The company's first-quarter results were mixed, with earnings growing and revenue declining. The company weathered the Covid-19 pandemic fairly well Continue reading...
Canopy Growth Corporation (CGC) closed the most recent trading day at $16.47, moving +1.92% from the previous trading session.
Despite fears that consumers might shun Corona beer because it reminds them of coronavirus, the brand reported growth in key metrics.
At a time when cash is king, which cannabis company is better suited to cover its losses without the expense of diluting shareholders?
Shares of Constellation Brands Inc. hiked up 2.9% in premarket trading Wednesday, after the company reported fiscal first-quarter adjusted profit and sales that beat expectations, as better-than-expected wine and spirit sales offset a miss in beer sales. The net loss for the quarter to May 31 narrowed to $177.9 million, or 94 cents per Class A share, from $245.4 million, or $1.30 a share, in the year-ago period. Excluding non-recurring items, such as restructuring charges and other business development costs, adjusted earnings per share came to $2.30, or $2.44 if losses from its investment in Canopy Growth Corp. are excluded. The FactSet consensus was for EPS of $1.99. Sales fell 6% to $1.96 billion, just above the FactSet consensus of $1.94 billion. Beer sales fell 4% to $1.38 billion, shy of the FactSet consensus of $1.41 billion, while wine and spirits sales declined 4% to $579.3 million but topped expectations of $570.7 million. The company, which brands include Corona, Robert Mondavi and SVEDKA Vodka, said beer production in Mexico has returned to "normal" levels in June, following COVID-19 pandemic-related disruptions. Earlier, the company announced the acquisition of "digitally-native" Empathy Wines. The stock has lost 7.8% year to date through Tuesday, while the S&P 500 has slipped 4.0%.
Year to date, shares of the two largest companies in the cannabis sector, Canopy Growth (NYSE: CGC) and Aurora Cannabis (NYSE: ACB), have not been performing well. Since the beginning of the year, Canopy Growth stock has declined by more than 20%, while Aurora's stock has fallen by as much as 50%. In fiscal year 2020, Canopy Growth generated more than $399 million in net revenue, representing a growth of 76% compared with last year.
Growing concerns in the U.S. pot market forced Canopy Growth to amend the deal with Acreage as the latter reported disappointing Q1 earnings. Will the new arrangement help Acreage's stock?
Many pot stocks are struggling to stay afloat this year, and many will have to shut down due to COVID-19 and the recession that the pandemic has caused. Trulieve Cannabis (OTC: TCNNF) has always been one of the safer pot stocks to invest in, for many reasons. First and foremost is the company's focus on the Florida medical marijuana market.
This week, the cannabis news world was somewhat dominated by Canopy Growth Corp (NYSE: CGC).The Smiths Falls, Ontario-based company hosted a virtual investor meeting to discuss the COVID-19 impact and business strategies. It also tweaked its previously announced capital agreement with Acreage Holdings Inc. (OTC: ACRGF).The amended arrangement provides for up-front cash payment to Acreage shareholders and certain convertible security holders in the amount of $37.5 million.Canopy's stock lost about 8% of its value this week.BofA Securities analyst Bryan Spillane reiterated a Buy rating and CA$30 ($21.70) price target for Canopy. Cantor Fitzgerald analyst Pablo Zuanic maintained a Neutral rating on Acreage Holdings and raised the price target from $2.30 to $2.90; Zuanic has a Neutral rating and CA$25.50 price target for Canopy."It's amazing how quickly the Acreage Holdings and Canopy Growth unraveled. While the acquisition is still planned, the price was dropped dramatically from $3.4 billion to roughly $37 million. Co-founder and CEO Kevin Murphy also resigned, but continues to hold a majority of the voting shares," Debra Borchart, Editor-in-Chief at Green Market Report, told Benzinga.In other news, actress and author Bella Thorne joined Rachel Cook and Jay Alvarrez as as an affiliate of DRIHP, an eco-friendly hemp apparel and accessories brand.Alcohol retailer Alcanna Inc. (TSX: CLIQ) (OTC: LQSIF) and cannabis company Aurora Cannabis Inc. (NYSE: ACB) finalized a deal offering worth $27.6 million. Under the agreement between Alcanna, Aurora, and a syndicate of underwriters, including AltaCorp Capital Inc., CIBC World Markets Inc., and Cormark Securities Inc., which led the process.The underwriters agreed to buy 9.2 million Alcanna's common shares at $3 per share.Aurora also announced this week another round of reductions in its selling, general and administrative (SG&A) expenses (with massive firings included) and consolidation of manufacturing facilities. The latest announcements should allow the company to expand gross margins by as much as 8 percentage points, according to Cantor Fitzgerald.Cantor's Pablo Zuanic maintained an Overweight rating for Aurora Cannabis, while raising the price target from CA$ 27 ($19.89) to CA$ 29 ($21.37).Israel is a step closer toward cannabis legalization, as the Ministerial Committee for Legislation approved a bill to legalize cannabis use on Sunday. According to The Times of Israel, the legislation is poised to legitimatize the possession of up to 50 grams of marijuana. In addition, it allows individuals older than 21 to possesses and consume up to 15 grams of marijuana.One World Pharma Inc. (OTC: OWPC), under the helm of Isiah Thomas, initiated the sale of its hemp seeds in Colombia.Over the five trading days of the week (and as of Friday 3pm ET): • The ETFMG Alternative Harvest ETF (NYSE: MJ): lost 5.3%. • The AdvisorShares Pure Cannabis ETF (NYSE: YOLO): slipped 6%. • The Cannabis ETF (NYSE: THCX): tumbled 6.4%. • The SPDR S&P 500 ETF Trust (NYSE: SPY) closed the period down 2.6%.Benzinga Cannabis' content is now available in Spanish on El Planteo.Havn Life Sciences Inc. announced the filing of its preliminary prospectus. The company is focused on standardized, quality-controlled extraction of psychoactive compounds from plants and fungi, including psilocybin. The company is also working on developing natural health care products from novel compounds. "There is enough research to show that psychedelics work. What we need is a safe, consistent and quality-controlled supply of these compounds in order for researchers to access what they need to move the industry forward. A safe and consistent supply of quality, naturally derived compounds is also needed for those in the clinical research space. This is what we are focused on developing," said Susan Chapelle, Co-CEO of Havn Life. ACS Laboratory acquired Botanica Testing Inc., a certified hemp and CBD testing laboratory. Botanica Testing has a portfolio of 500 clients and a reputation for quality that aligns with ACS's standards and ongoing expansion across the U.S. This acquisition expands ACS's multi-state reach in the hemp and CBD market, offering an extensive range of hemp testing options from pre-planning through postproduction."The Botanica agreement is the first step in a large journey to acquire reputable companies across the United States and have the largest footprint of any cannabis and hemp testing laboratory," said Roger Brown, President of ACS Laboratory.Flourish Software, a supply chain and inventory management software for cannabis, hemp and CBD operations, announced a new integration with CannVerify, the cannabis industry's blockchain authentication tool. The new integration will enhance protection for Flourish's users against counterfeiting through CannVerify's patent-pending, two-step verification process, which features a unique serial number, QR code, and scratch-off verification code for every product. The QR codes make it easy for Flourish users to add detailed product information and activate serials in bulk in their online system."Through this new integration, sellers in the cannabis market will have greater accuracy of their inventory and get the benefit of product visibility from the seed to the sale, all while protecting their brand from counterfeiters," said Colton Griffin, CEO of Flourish.Michigan-based cannabis company Exclusive Brands is launching a 30-acre Arlington cultivation site. The family-owned brand expects to grow 10,000 plants at the site during its first phase.Benzinga will be hosting a virtual Cannabis Capital Conference in August. Check out details here.Cannabis and hemp company Jushi Holdings Inc. (CSE: JUSH) (OTC: JUSHF) agreed to acquire Vireo Health International Inc. (CSE: VREO) (OTC: VREOF)'s Pennsylvania-based subsidiary in a $37 million deal.Gotham Green is demanding debt repayments from multistate cannabis operator iAnthus (CSE: IAN) (OTC: ITHUF). IAnthus recently disclosed that it's saddled with almost $160 million in debt. Its shares were suspended from trading on the Canadian Securities Exchange after failing to provide financial reports by its June 15, 2020 deadline. The cease of trade order could be revoked if the company makes the required fillings within 90 days of the date of the CTO.Movement for Family Power, the Drug Policy Alliance and NYU Family Defense Clinic have released a new report focused on the child welfare and foster system and its intersection with the war on drugs. This report -- titled "Whatever they do, I'm her comfort, I'm her protector: How the foster system has become ground zero for the US drug war" -- comes at an important moment. The volume surrounding the systems the U.S. has in place (and how those systems work against Black, Brown, and marginalized people) is getting louder.Top Stories Of The Week Check out the top stories on Benzinga Cannabis this week: * How The 'War On Drugs' And Foster System Harm Minorities And Low-Income Families * TVC Capital's Jeb Spencer Shares Insights On Cannabis Market, His Latest Investment * Lelen Ruete's Cannabis Photography: 'The Plant Is Artistic, I Propose To Enhance It' * Understanding THCX, MJ Cannabis ETF Dividend Announcements * God's Greenery CEO Cites CBD Boom Among Christians, Prepares Product Rollout * Why 2021 Willl Be The Year For Marijuana LegalizationTop Spanish-language stories of the week: * Todas las Dalias, La Dalia: Magia, Amor, Freestyle, Porro y Cuarentena * La Historia de YVY, la Exitosa Empresa Uruguaya de Cannabis Medicinal * Plasticos de Cañamo: ¿el Futuro de la Ecologia? * Entrevista a Luanda Vol. I: Porro, Vivo, y Nuevo DiscoCheck out these and many other cannabis stories on Benzinga.com/cannabisLead image by Ilona Szentivanyi. Copyright: Benzinga.See more from Benzinga * ESPAÑOL • Empresa de Isiah Thomas Vende Semillas, Marihuana Contra el Coronavirus, Inversiones en Cannabis, y Más * ESPAÑOL • Dividendos en ETFs MJ y THCX, Canopy Growth, Entrevista en el Cumpleaños del Duki, y Cannabis en Israel * Understanding THCX, MJ Cannabis ETF Dividend Announcements(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Canopy Growth (NYSE:CGC) and some of its marijuana equity peers are in the midst of a mini-resurgence. CGC stock is higher by almost 33% in the current quarter. As impressive as that move is, Canopy would need to roughly quadruple to get back to its 2018 high.Source: Shutterstock Over the near-term, asking Canopy or any of the other beaten-up-but-rebounding Canadian cannabis names to return to the 2018 highs is asking a lot. But, the company is getting its act together and price action in CGC stock is reflecting as much.A long-held knock on Canopy is that the producer frequently grows more cannabis than it can sell. This is prompting some analysts to remain leery of operational improvements being credible catalysts for the stock.InvestorPlace - Stock Market News, Stock Advice & Trading TipsHowever, there are reasons to believe Canopy is, finally, prioritizing efficiency. The company recently closed some production sites, trimmed headcount and announced plans to hone its geographic emphasis.To the latter point, Canopy is emphasizing its home market of Canada, Germany and the U.S.Briefly summarizing the first two markets, Germany is Europe's most advanced legal cannabis market. In Canada, the marijuana market is liberalizing. This includes an open-store licensing policy that could boost sales in the key recreational user demographic. Looking South of the BorderWhen the marijuana equity collapse started in earnest last year, a frequent refrain among analysts and investors was that Canadian growers didn't have enough exposure to the faster-growing U.S. market. That troublesome scenario boils down to marijuana being illegal at the federal level. That means it's practically impossible to export it into this country. * 10 Consumer Stocks to Buy to Ride the Post-Covid-19 WaveHowever, things are looking up in the U.S. for cannabis growers.In the wake of Covid-19, states are struggling to fill budget gaps. Thus, lawmakers are entertaining legalization of some vices, primarily online and sports betting and cannabis, as revenue-generating avenues. Sports gambling is an easier road to traverse because it's federally permissible, but that's not keeping plenty of states from mulling cannabis legalization.Entering 2020, some analysts estimated as many as 16 states could put cannabis initiatives on the November ballot, but those efforts suffered setbacks because of the novel coronavirus pandemic. There are 27 states where budget gaps will surpass 10% this year and a third are considering marijuana legislation or ballot proposals in 2020. The U.S. Market and CGC StockLike plenty of other companies in scores of industries, Canopy has its share of missteps. Waiting for the U.S. market to liberalize isn't one of them.Last year, Canopy struck a deal with Acreage Holdings (OTC:ACRG), a U.S.-based multi-state operator, to acquire that company with the caveat being the agreement will be consummated when marijuana becomes legal in the U.S.That could happen sooner than some expect.In the essence of avoiding overt political chatter, polls and prediction markets are pricing in lengthening odds of President Donald Trump being reelected and shortening odds of a blue wave in Congress.Although some Republicans are warm to the idea of cannabis legalization, Democrats controlling both houses of Congress and the White House would speed the process along. This would potentially benefit CGC stock along the way. Bottom Line on CGC StockCanopy is relevant again and that's a solid starting point. Yes, there is some operational risk lingering, meaning the company needs to prove it can execute on grower-smart initiatives and that its three-market focus will pay off.However, even with CGC stock up almost 33% in less than three months, investors considering the name today are paying for a Canada liberalization and corporate execution story with a call option on U.S. legalization for little to no cost.Todd Shriber has been an InvestorPlace contributor since 2014. As of this writing, he did not hold a position in any of the aforementioned securities. More From InvestorPlace * Why Everyone Is Investing in 5G All WRONG * America's 1 Stock Picker Reveals His Next 1,000% Winner * Revolutionary Tech Behind 5G Rollout Is Being Pioneered By This 1 Company * Radical New Battery Could Dismantle Oil Markets The post Canopy Growth Worth a Nibble if the U.S. Cooperates appeared first on InvestorPlace.
Acreage Holdings Inc's (OTC: ACRGF) first-quarter results showed improved operating trends, and the company exited the quarter with lower liquidity risks, according to Cantor Fitzgerald.The Acreage Analyst Pablo Zuanic maintained a Neutral rating on Acreage Holdings and raised the price target from $2.30 to $2.90.The Acreage Thesis Acreage achieved 15% sequential sales growth in the March quarter, with master service agreement units generating 20% revenue growth and the company's gross margins expanding by four percentage points, all of which are "good metrics," Zuanic said in a Friday note. (See his track record here.)Although Acreage's performance in the second quarter will be impacted by COVID-19-related closures of some of its facilities and dispensaries, the cannabis company seemed confident of reaching positive EBITDA for the year, the analyst said. Referring to the risk of insolvency, Zuanic said the company exited March with $40 million in cash; is making efforts to resize the business; and should be able to raise about $80 million from an equity offering, which has already been agreed upon as part of the revised terms of its contingent deal with Canopy Growth (NYSE: CGC).View more earnings on ACRGFGiven these factors, "we now take a 50% discount (to the Canopy Growth contingent deal offer price) to value Acreage vs. 60% before," the analyst said.ACRGF Price Action Shares of Acreage Holdings were down 9.03% at $2.62 at the time of publication Friday.Related Links:Canopy Continues To Expand, Amends .5M Deal Agreement With AcreageCannabis Stock Gainers And Losers From June 25, 2020Latest Ratings for ACRGF DateFirmActionFromTo Jun 2020Cantor FitzgeraldMaintainsNeutral Jun 2020MKM PartnersMaintainsBuy Sep 2019MKM PartnersInitiates Coverage OnBuy View More Analyst Ratings for ACRGF View the Latest Analyst Ratings See more from Benzinga * After BlackBerry's Mixed Q1, BofA Says Its Valuation Reflects Risk * Apple's Patent Activity Points To Broad Product Development, Says Bullish BofA * BofA Raises Splunk Target On Annual Recurring Revenue Growth(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Those who follow me know that I am long-term bullish on the cannabis space. But that does not mean I am bullish on every stock in the industry, like Tilray (NASDAQ:TLRY). While TLRY stock has done a great job bouncing off the 2020 lows, that alone does not mean it's a buy.Source: Jarretera / Shutterstock.com In fact, investors who have been long this name may consider the recent rise an opportunity to exit the stock. Similarly, they may consider the more recent pullback in the short term as a buying opportunity to buy other cannabis plays.In that regard, I am referencing stocks like Aphria (NASDAQ:APHA) or one of my favorites in Canopy Growth (NYSE:CGC).InvestorPlace - Stock Market News, Stock Advice & Trading Tips Tilray Stock Lacks on FundamentalsThe cannabis industry as a whole has been going through a difficult stretch. However, some stocks are better equipped than others to make it through to the other side.Take a look at Canopy Growth, which has a potent balance sheet and a more clear strategy for long-term success. It even has a potential acquirer in Constellation Brands (NYSE:STZ), which continues to exercise its rights to increase ownership. * 10 Consumer Stocks to Buy to Ride the Post-Covid-19 Wave In fact, when you think about those with the stronger balance sheets, they usually have a big-time, well-known company involved. Notice how Tilray doesn't lean on its balance sheet strength.While there is not an immediate concern that Tilray will be able to meet its short-term obligations, there is virtually no concern for Canopy Growth to meet its obligations.Tilray has current assets of $338.9 million vs. current liabilities of $171.3 million. The former is about twice the size of the latter. However, compare that to CGC, which has current assets at more than six times the size of its current liabilities. Is Growth Enough?For a regular company, Tilray's growth profile would be incredible. Analysts expect 42% revenue growth this year and an acceleration up to 55% growth in fiscal 2021.However, recall that Tilray used to have fantastic growth. Just last quarter the company reported 126% sales growth. In prior quarters, 200% to 300% growth was present. So to see growth estimates of just 42% is rather disappointing -- even as saying "just 42%" feels absurd.That's on top of the company continuing to lose money. Analysts expect Tilray stock to report a loss of $2.27 per share this year. While that would be better than the $3.20 per share it lost in FY 2019, it's not something to brag about.That's particularly true as free cash flow continues to trail in the red. Unfortunately, this figure is moving in the wrong direction. In fiscal 2017, Tilray had free cash outflow of $17.4 million. In 2018 that figure ballooned up to $100 million before more than tripling to a free cash outflow of $336.8 million in 2019.So is the growth enough? Not in my mind. Perhaps if cannabis becomes legal at the federal level, then these companies can start to really fly. But for now, the industry is struggling and I want to avoid its weakest players, like Tiray stock. Bottom Line on Tilray Click to EnlargeSource: Chart courtesy of StockCharts.com Surprisingly, Tilray stock has been trading in a tight range, spending the last two weeks between $8 and $9. But friends, remember this stock hit $300 at one point. While that move was mainly driven by a short squeeze, the fact that TLRY stock is down some 97% isn't a sign that there are a bevy of buyers looking to scoop up shares.The 100-day moving average continues to squeeze Tilray stock lower. It's currently riding uptrend support while struggling to hold the 50-day moving average.A close below $8 will be a very bearish development, potentially putting $6 or lower back on the table. Conversely, a close over the 100-day moving average is bullish. It would put the June high in play at $10.68, followed by the May high at $11.60.Either way, the fundamentals aren't bullish enough for me as the industry is in a period of struggle. Combined with muddy technicals (at best) and I will continue to avoid Tilray 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 * Why Everyone Is Investing in 5G All WRONG * America's 1 Stock Picker Reveals His Next 1,000% Winner * Revolutionary Tech Behind 5G Rollout Is Being Pioneered By This 1 Company * Radical New Battery Could Dismantle Oil Markets The post Continue Avoiding Tilray Stock as Charts, Fundamentals Lag appeared first on InvestorPlace.
Canopy Growth Corporation (NYSE:CGC) might be a shell of its former self and worthy of the "dead money" label, but there is a way to inject profits into the lifeless corpse. You don't have to be a doctor, and it's not even that complicated. All it requires is a little bit of money and the willingness to embrace CGC stock options.Source: Shutterstock The High Has Gone Bye-ByeThe hype train for cannabis stocks was running full steam ahead from 2017 to 2019. But last summer reality set in and the locomotive quickly derailed. It's been an unending train wreck ever since, and all of the big players in the industry, from Tilray (NASDAQ:TLRY) and Cronos Group (NASDAQ:CRON) to Canopy Growth, have seen their share prices return to their humble beginnings.During the pot stock mania, CGC stock grew from a single-digit munchkin to a veritable marijuana giant. From the beginning of 2017 to its ultimate peak of $59.25, CGC exploded 769%. Along the way, bulls spun sweet-sounding narratives of widespread marijuana legalization and increased adoption by the masses.InvestorPlace - Stock Market News, Stock Advice & Trading TipsUnfortunately, reality has seen more thorns than roses. True believers have been sorely tested as their paper profits have dissipated alongside the share price. CGC's most recent earnings weren't stellar. * 10 Consumer Stocks to Buy to Ride the Post-Covid-19 Wave It is against this backdrop that we must assess Canopy's current price chart. CGC Stock ChartSource: The thinkorswim® platform from TD Ameritrade The weekly downtrend leaves much to be desired. We're submerged beneath the major moving averages and have yet to reverse the series of lower pivot highs and lows. For all its fury, the rebound off the March low still looks like a bear retracement. The upswing ended with a nasty-looking dark cloud cover candlestick right at the 200-week and 50-week moving averages.Since then, four narrow-bodied, indecisive candles have cropped up, signaling a short-term stalemate between bulls and bears.On the daily view, the 200-day moving average is bearing down on the stock, bringing resistance with it. At the same time, the 20-day and 50-day moving averages are flattening out in response to a weakening of what could have become a nice uptrend. Everything was lining up quite bullish until the late-May earnings report arrived to spoil the party. Since then, as reflected by the quartet of weekly dojis, we've seen neutrality, a sideways shimmy revealing indecision.Source: The thinkorswim® platform from TD Ameritrade The long-term downtrend suggests bears will likely be the eventual victor. But until we push decisively below $16, buyers have a chance.Buying CGC stock outright seems too risky, though. I'd at least couple your equity purchase with a short call trade. Together, this forms a covered call and is the secret to squeezing profits out of the stock even if it remains dead. Canopy Covered CallsWhen you sell a call against stock, you are getting paid a premium for the obligation to sell your shares at a set price. That premium is your cash flow and can be used to generate some income as well as offset minor losses in the stock. In that sense, it provides a small amount of downside protection.The Trade: Buy 100 shares of CGC and sell the August $17.50 call option for $1.60.If you purchased the stock for $16.60, then the overall cost basis would be $15 (after accounting for the call premium received). If the stock continues trending sideways until expiration, then the call will expire worthless, and you'll pocket the $1.60. That works out to an 11% return, or 22% if you're buying the stock on margin.But it gets better.If CGC rises past $17.50, you also grab another 90 cents from the price increase in the stock. Thus, your max profit is $2.50, which translates into a 17% return, or 34% on margin.By covered call standards, that's a really high rate of return.For a free trial to the best trading community on the planet and Tyler's current home, click here! As of this writing, Tyler held neutral options positions in XOM. More From InvestorPlace * Why Everyone Is Investing in 5G All WRONG * America's 1 Stock Picker Reveals His Next 1,000% Winner * Revolutionary Tech Behind 5G Rollout Is Being Pioneered By This 1 Company * Radical New Battery Could Dismantle Oil Markets The post How to Breathe Profits into Dead-Money CGC Stock appeared first on InvestorPlace.
Apple could be the first U.S. company to reach the outrageous market cap. The Federal Reserve announces the results of its annual stress test of American banks. Plus, the latest on Canopy Growth’s acquisition of Acreage Holdings.
U.S. cannabis company Acreage Holdings Inc. took an impairment charge of nearly $200 million in reporting first-quarter earnings Thursday afternoon. The company reported an overall loss of $172 million, or $1.85 a share, on net sales of $24.2 million, up from revenue of $12.9 million a year ago, with most of the losses coming from a pre-tax charge of $196 million that came to $164.7 million after taxes. Acreage said that the charge was related to an earlier restructuring announcement, but noted that the "charge was higher than previously guided due primarily to impairments based on current fair market value in certain states and the write down for its services agreement in Maine, which were not initially contemplated." Acreage stock shot 23.7% higher in Thursday's regular trading session after Canopy Growth Corp. amended its merger agreement to provide capital to the U.S. company. Canopy agreed to acquire Acreage more than a year ago, but can not actually own the company outright until or unless the U.S. legalizes marijuana federally, as Canada has.
Canopy Growth Corporation (CGC) closed the most recent trading day at $16.59, moving -0.72% from the previous trading session.
Canopy Growth Corp. (TSX: WEED) (NYSE: CGC) and Acreage Holdings Inc. (OTC: ACRGF) have tweaked their previously announced capital agreement meant to fund hemp operations.The amended arrangement provides for up-front cash payment to Acreage shareholders and certain convertible security holders in the amount of $37.5 million.The share deal is comprised of up to 12.4 million floating shares and up to 20.3 million fixed shares.The original arrangement was announced on April 18, 2019. Canopy had agreed to acquire all of the issued and outstanding securities of Acreage."The United States is going to be a core market for Canopy Growth" David Klein, Chief Executive Officer of Canopy Growth, in a prepared statement.Klein added that the new agreement "solidifies" the company's path forward with Acreage."I am excited to bring our relationship with Acreage back to centre stage in our U.S. strategy and look forward to a time when the laws in the United States permit us to finalize this transaction as we march toward bringing our exciting beverage products to the US," he added.Courtesy photoSee more from Benzinga * God's Greenery CEO Cites CBD Boom Among Christians, Prepares Product Rollout * Charlotte's Web Snares Abacus, CEO Looks Forward To 'B Market Opportunity' * 'Schizophrenic Policy' Handicaps Cannabis — Here's What One Pot Attorney Says Feds Need To Change(C) 2020 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.