|Bid||198.60 x 800|
|Ask||199.29 x 900|
|Day's Range||193.34 - 199.88|
|52 Week Range||150.37 - 236.62|
|Beta (3Y Monthly)||0.68|
|PE Ratio (TTM)||11.31|
|Earnings Date||Jun 27, 2019 - Jul 1, 2019|
|Forward Dividend & Yield||2.96 (1.69%)|
|1y Target Est||218.64|
Marijuana M&A heats up, as Canopy buys Acreage. Bruce Linton, Canopy CEO, and Kevin Murphy, Acrage CEO, discuss with CNBC's Melissa Lee and the Fast Money traders, Tim Seymour, Brian Kelly, Steve Grasso and Guy Adami.
Constellation Brands is boosting its U.S. beer business while betting that marijuana products will deliver big sales.
It's 420. TheStreet's Jim Cramer discusses Canopy Growth, Tilray, Constellation Brands and other investing opportunities in the cannabis sector!
A company that jumps to a major stock exchange is the "rocket ship" event of marijuana stocks. It can send shares soaring to a whole new level -- into the stratosphere.This is what my research identifies. Companies in prime position for takeoff… but still before they blast off. The best way to show you what I'm talking about is to give you an example.There's a particular chart that marijuana execs are obsessed with right now -- and I can't blame them:InvestorPlace - Stock Market News, Stock Advice & Trading TipsCronos Group (NASDAQ:CRON) soared nearly 10,000% in less than three years. It's significant because it was the first of the Canadian cannabis stocks to make the leap to a major U.S. stock exchange. It began trading on the NASDAQ in February 2018.But let's go back to December 27, 2017 -- prior to the company announcing it had filed to list on the NASDAQ. It was trading on the smaller OTC market under the symbol PRMCF.In a newsletter I was writing at the time, I recommended Cronos when it was trading at $5.50 per share on the OTC exchange. Given our short-term trading strategy, we sold the stock in just 48 hours -- and locked in a nearly 50% profit!Pretty good for a couple day's work. * 5 Dividend Stocks Perfect for Retirees It was a fantastic short-term win, but now let's look at Cronos with the longer-term strategy I employ today. In a monster trend like what marijuana stocks are enjoying, we want to hold for the huge profits that can go along with it.On February 27, 2018, Cronos jumped to the NASDAQ and made history as the first Canadian marijuana company to list on a major U.S. exchange. The stock closed the Friday before the announcement at $7.01. One week after the announcement, it traded as high as $10.39 -- a rally of nearly 50%.Almost three months later on May 23, 2018, Cronos made another jump within Canada when it moved from the TSX Venture Exchange to the major Toronto Stock Exchange (TSX). Two weeks later, the stock was up 28%. (Note: Most Canadian marijuana stocks begin their public lives on the TSX Venture Exchange. The jump to the TSX is the equivalent of uplisting from the OTC to the NYSE in the United States.)As you can see in the chart above, both jumps resulted in big short-term profits. But you can make a lot more money by holding on for the longer-term surge that begins with the jump.Things change in the blink of an eye when tiny cannabis stocks go from having 30 million people following them in Canada to more than 300 million in the United States. Wall Street banks like Morgan Stanley and TD Ameritrade poured over $200 million in Cronos.What happened next was a chain reaction. The story appeared everywhere in the mainstream press… retail investors began jumping in… and the rest, as they say, is history.Two months before jumping to the NASDAQ, Cronos' average daily volume was 280,000 shares. Today, its average daily volume is around 16 million shares. That's a 5,600% jump in average volume in 16 months and a direct result of the uplisting.As billions of dollars poured into the stock, the shares soared from $0.25 per share in July 2016 to $25 per share in January 2019 -- a gain of nearly 10,000% in less than three years.These are the stocks I aim to identify -- the ones with the ability to jump 10X in the next few years. These are the kinds of gains that can change your life. Attracting Big MoneyCronos Group isn't the only Pot Jumper Stock out there, but it's one of only a few. Just a handful of companies have made the jump to a major U.S. stock exchange in the last year. Now, they are some of the biggest names in the world when it comes to marijuana stocks.You may have heard of a company called Canopy Growth (NYSE:CGC).It's the largest marijuana company on the planet. All the media outlets love to talk about it. Mostly because it's done nothing but go up in price.Canopy's explosive gains can be traced back to its jump.I first looked at Canopy back in April 2016. It was trading for just $2 per share… and it wasn't on anybody's radar.But I believed Canopy was poised for a huge profit explosion. And sure enough, that's exactly what happened.On May 24, 2018, Canopy became the first marijuana company to trade on the NYSE. The first day of trading was unimpressive to say the least. The stock fell 6% and shortsighted critics concluded that marijuana stocks were not ready for the big time.Well… they couldn't have been more wrong. Just six months later, Canopy had more than doubled.Jumping to a major U.S. stock exchange woke up the big boys -- just like it did with Cronos.In August 2018, multi-billion-dollar alcohol conglomerate Constellation Brands (NYSE:STZ), which is best known for its Corona beer brand, invested $4 billion into Canopy. This followed its initial October 2017 investment of $245 million and gave Constellation a 38% stake in Canopy.And not only did Constellation invest a large amount of money, it did so at a huge 51% premium.So remember when I said I first liked Canopy when it was trading at $2 per share? Today, it has grown into a $14.5 billion behemoth. It traded as high as $59.25 on October 16, 2018 -- which means early investors could have locked in gains of 2,800%+ in just two-and-a-half years. Don't WaitYou can see why I love the legalization trend and the opportunities opening up in marijuana stocks that can make the jump to a major stock exchange.Remember, we're still in the early stages of this jumper phenomenon. I was just in NYC this week at a cannabis conference, and I can tell you that people I spoke with now think it is more likely than before that President Trump will legalize at least some form of marijuana use. Not only would pot stocks in general surge, but the trickle of companies uplisting to major exchanges would turn into a flood.Whether that happens or not, we've uncovered a reliable system for identifying and exploiting what is undoubtedly the biggest -- and often most overlooked -- catalyst in the marijuana markets: cannabis stocks that jump to the major exchanges.My Pot Jumper System has already yielded great results. And now's the perfect time to get in on the action.If you'd like to see how this approach could make virtually anyone a millionaire, then watch this. And you can get my No. 1 cannabis recommendation for free… just for watching.Matthew McCall is the founder and president of Penn Financial Group, an investment advisory firm, as well as the editor of Investment Opportunities and Early Stage Investor. He has dedicated his career to getting investors 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), +1,044% in Tesla (TSLA), +611% in Liquefied Natural Gas Limited (LNGLY), +324% in Bitcoin Services (BTSC), just to name a few. If you're interested in making triple-digit gains from the world's biggest investment trends BEFORE anyone else, click here to learn more about Matt McCall and his investments strategy today. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 5 Dividend Stocks Perfect for Retirees * 7 Reasons the Stock Market Rally Isn't Over Yet * 10 S&P 500 Stocks to Weather the Earnings Storm Compare Brokers The post How to Know When to Buy Marijuana Stocks appeared first on InvestorPlace.
It’s been a mixed bag for beverage investors in recent quarters, but one analyst reiterated coverage of three beverage names on Thursday and said there’s an excellent buying opportunity for selective investors. ...
Canopy Growth will probably purchase the rights to buy Acreage Holdings to tap the growing potential of the U.S. marijuana market. This should bolster the ETF MJ.
As the trend of marijuana legalization continues, cannabis-related stocks continue to proliferate. But fundamentals and technicals remain weak for many of the stocks in this space.
The story really begins with the November 2017 investment made in Canopy Growth by Constellation Brands that left Constellation with a 38% equity stake in the firm and a pathway toward a controlling interest over a number of years. Cafina comes with a licence already in force to cultivate, distribute and export cannabis for medical and/or research purposes.
Constellation Brands, Inc. (NYSE:STZ and STZ.B), a leading beverage alcohol company, today announced that it plans to enter into an agreement with Canopy Growth Corporation (“Canopy”) (TSX: WEED, NYSE: CGC), a leading diversified cannabis company, to modify certain warrants and other rights. These changes are the result of Canopy’s intentions to acquire Acreage Holdings, Inc. (“Acreage”) upon U.S. Federal cannabis legalization. Earlier today, Canopy announced (see Canopy press release “Canopy Growth Announces Option to Acquire Leading U.S. Multi-state Cannabis Operator, Acreage Holdings”) it has entered into an agreement with Acreage, a U.S. multi-state cannabis operator, where Canopy plans to acquire the shares of Acreage upon U.S. Federal cannabis legalization (the “Triggering Event”), subject to certain conditions. This transaction, as well as proposed modifications to certain Constellation warrants, are subject to approval by Canopy shareholders.
On CNBC's "Mad Money Lightning Round," Jim Cramer said he would wait for Arista Networks Inc (NYSE: ANET ) to come down before buying the stock. Cramer likes NVIDIA (NASDAQ: NVDA ). He loves ...
Canopy Growth (NYSE CGC), along with most other cannabis firms, continues to operate at a loss as it builds out the infrastructure, develops its markets and develops goods that differentiate itself from the competition. Yet so far, pot stock investor seem oblivious to the risks of ongoing losses for the foreseeable future. So before investing in CGC stock, you need to pause for a moment to look at a few metrics. In doing so, investors can confirm that the company is on the right track. With that in mind, how does CGC stock fare for the speculative investor?Source: Shutterstock Operational EfficiencyCanopy Growth's yield potential in Canada is a good indicator of the company's operational efficiency. Much of the profit potential depends on government regulation and the pace at which it approves Canopy's medical products.Problems begin when investors look at the company's efficiency outside of the Canadian region, namely Europe, Australia, and South America. In those places, management does not have a clear estimate on yield over the next 1.5 to 3 years. Denmark has yet to produce supply for Canopy and is not scheduled to do so until later this year.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 Stocks to Buy for Spring Season Growth This is yet another example of investors waiting for production to increase in meaningful quantities. Even if it reaches full utilization on time, investors are hardly assured that revenue from sales will exceed the costs for producing edibles and beverages. Weak Quarterly ResultsInvestors reacted negatively to Canopy Growth after it reported results on Feb 27. CGC stock had previously topped $59.25 but now trades near $42 -- and for good reason. Revenue of $83 million CAD tripled from last year, but Canopy Growth still lost 38 cents CAD a share. It also missed analyst consensus estimates. The company failed to benefit from average selling prices going up.The ongoing losses suggest that the company will have to raise prices even more to offset growing losses. If the product is demand elastic, Canopy may have a hard time selling in higher volume when prices are up.Temporarily non-producing facilities, absorption of the medical excise tax and commitments to sales and marketing and corporate infrastructure spending led to an adjusted EBITDA loss of $75.1 million. However, Canopy Growth is likely to face other one-time charges in the upcoming quarter -- so don't write this off as a one-time issue. Medical PlatformThe medical side of Canopy Growth faced some pressure in the third quarter. To counter the headwinds, Spectrum, its wholly owned subsidiary, needs more education-driven activity to grow awareness of the brand and the medical products. On Apr. 12, Spectrum Cannabis announced a partnership with an endorsement from CARP, a Canadian advocacy association for aging Canadians. It will offer tailored educational initiatives for over 320,000 CARP members.The company continues to believe that its medical opportunity globally over the next three years has a higher growth potential over the recreational market. For this to happen, Canopy therapy would need to face fewer regulatory hurdles than medical marijuana.Canopy is also running a promising study evaluating the efficacy of medical cannabis for treating insomnia. These tests are currently in Phase IIb clinical trials. It received approval from Health Canada in the second quarter of 2019. Thanks to awareness from the client base for cannabis in its role in helping to fall asleep or stay sleep, Canopy only needs to refine the ingredients and run a number of trials to gain approval from regulators. Strong Cash BalanceCanopy Growth has a few bright spots. Shareholders may point to the safety of its cash levels as one of those. By looking at Canopy's $4.9 billion in cash, most of which came from Constellation Brands, Inc. (NYSE: STZ), investors are at least assured that the company will not run out of money any time soon.Canopy's inventory build-up is also another positive development. Management intentionally increased inventory from $102 million at the end of March 2018 to $185 million at the end of December 2018. It is scaling up supply to meet strong market demands. As the legalization of the recreational market and medical customers expect more choice, the company expects sales volumes to increase. * 10 S&P 500 Stocks to Weather the Earnings Storm The Bottom Line on CGC StockThe risks in Canopy Growth is typical with any other stock in this sector: losses outpace revenue. The market is willing to wait for output to increase in 2019 but risks remain. Still, the company has lots of cash so short-term risks are low. Plus, as supply facilities are built, its efficiency will get better through scale.Disclosure: As of this writing, the author did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Stocks to Buy for Spring Season Growth * This Is How You Beat Back a Bear Market * 7 Dental Stocks to Buy That Will Make You Smile Compare Brokers The post Is CGC Stock on the Right Track? appeared first on InvestorPlace.
Bill Nygren (Trades, Portfolio), portfolio manager of the Oakmark Fund, started two positions and exited five in the first quarter, he said ahead of Securities and Exchange Commission deadlines for portfolio disclosure. Warning! GuruFocus has detected 3 Warning Sign with STZ. In a first-quarter letter released last week, Nygren discussed purchases of Constellation Brands (STZ) and S&P Global Inc. (SPGI).
Cannabis and marijuana stocks are an exciting industry right now. According to Cowen & Co.'s Vivien Azer - a pioneer in cannabis-stock analysis - U.S. marijuana sales are set to reach about $80 billion by 2030. Currently, U.S. legal and illicit sales combined total at least $50 billion. That's on top of an estimated $C12 billion in Canadian revenue by 2025 for both recreational and medical use.The problem? It's still early days for the sector, which means significant risk is involved. It's common to see these primarily small- and mid-cap stocks move 10% or more in response to headlines or quarterly earnings reports. Companies are rushing to establish an early leadership position, and not all of them will end up winners. Plus, the federal legalization of cannabis in the U.S. remains a big question mark.So how do you pinpoint the most compelling investing opportunities in this lucrative industry? One option is to focus on the cannabis stocks that the Street is most bullish on right now.We used TipRanks market data to pinpoint five cannabis and marijuana stocks to buy based on overwhelmingly positive consensus ratings among Wall Street analysts. Let's take a closer look at each. SEE ALSO: Goldman Sachs: 7 Growth Stocks to Buy With Explosive Potential
Poor earnings from cannabis producer Aphria (NYSE:APHA) let loose a foul smell across the marijuana sector to start the week. Investors lit up Aphria stock for a 15% loss on Monday. The rest of the major pot players suffered significant losses in sympathy. Canopy Growth (NYSE:CGC) couldn't buck the trend. CGC stock fell 3.6% on Monday, extending its downward momentum.Source: Shutterstock On the one hand, it's tempting to dismiss Aphria's results as not being a big deal. Aphria is a scandal-plagued company whose former management quit. Short sellers attacked the company for allegedly mistreating shareholders.Aphria's results included a big writedown on one the controversial assets, suggesting that the short sellers were correct about wrongdoing there. That said, even excluding potential questionable dealings, Aphria's results straight up stunk.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 AI Stocks to Watch with Strong Long-Term Narratives Aphria's quarterly loss came in at at -C$0.20. That was far worse than the four cent loss that analysts had expected. Additionally, Aphria printed just C$74 million in revenues against expectations of C$83 million. To put it bluntly, this was an awful start to earnings season for the marijuana companies. What's it mean for CGC stock? Aphria Stock and Investor ExpectationsUp until last October, marijuana companies could largely get by with just selling investors a promising story. Few market participants cared about how much money the pot players were losing. The losses didn't matter, since people assumed that windfall profits would come once legalization arrived on a national level in Canada.Aphria initially showed signs that this could come true, as they became the first to deliver a quarterly profit a few months ago. But this quarter showed a big setback. The profits vanished, turning back into large losses (even before the accounting write-down on their LatAm business).The average price per gram sold continues to drop and gross margin plummeted. Some of this is due to changing distribution strategies, but a lot appears to be tied to simply too much marijuana production compared to demand.When marijuana wasn't legal yet, investors didn't have to worry about revenues, profit margins, cash burn, and the like. The future held so much potential. Now, however, the numbers get more and more troubling with each passing set of quarterly results. Canopy's earnings don't come out for another month yet. But with Aphria's numbers looking so dour, people will be on the defensive in CGC stock. Canopy Growth and Aphria StockOn the other hand, it's not all bad news for CGC stock either. Marijuana is a Wild West right now. Dozens of companies are rushing into the arena, trying to grab their share of the fortunes that are being made. Unfortunately, like in the gold rush of 1849, most people that try to make money will end up losing. The marijuana industry will have to consolidate; there isn't room for dozens of firms to be profitable.Canopy has a huge leg up here, as it is one of the few weed players with a major backer. Canopy was the first to score a major corporate endorsement, getting Constellation (NYSE:STZ) to invest heavily in the firm. Since then, Cronos (NASDAQ:CRON) scored a similar major backing from Altria (NYSE:MO).That should give those two firms a major advantage moving forward. Smaller and unaligned marijuana firms are suffering major losses and cash burn. They'll have to keep raising capital from the markets on increasingly unfriendly terms.Meanwhile, the select few which have major sponsorship will be able to operate more efficiently and consolidate the industry as weaker players drop out. Aphria, with its scandals and shifting management team could be one of the victims of this consolidation wave, giving more of the market to Canopy. Aphria Stock Was Bound to TumbleThere's another sign of the strong getting stronger while weaker players like Aphria stumble. That would be the stock indexes. Last Friday, S&P announced that CGC stock will be joining the prestigious S&P/TSX 60 stock index. This index tracks the 60 largest firms in Canada, and is one of the major players that passive ETFs and mutual funds follow.Remarkably, Canopy, even as such a new operation, has already managed to outpace one of Canada's leading precious metals firms, Goldcorp (NYSE:GG). Canopy surpassed Goldcorp in market cap, leading to CGC stock taking GG's place in the index.When this change is put into effect later this week, it should lead to a surge of buying for CGC stock as passive funds are mechanically forced to exchange their Goldcorp stock for Canopy. Smaller firms like Tilray (NASDAQ:TLRY) and Aphria won't benefit from this sort of index buying, as their market caps are simply too diminutive to get picked up by major stock indexes. The Bottom Line on Aphria StockAphria kicked off earnings season with some dreadful numbers. And let's face facts, they won't be the only ones. The shine is coming off a lot of these pot stocks now that legalization is here and yet the losses keep piling up.At the time of this writing, Ian Bezek owned MO stock. You can reach him on Twitter at @irbezek. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Internet Stocks to Watch * 7 AI Stocks to Watch with Strong Long-Term Narratives * 10 Dow Jones Stocks Holding the Blue Chip Index Back Compare Brokers The post Aphria Stock Might Be the First Victim as Pot Stocks Face Reality appeared first on InvestorPlace.
There's one obvious piece of good news in Monday's fiscal-third-quarter earnings report from cannabis producer Aphria (NYSE:APHA). Revenue rose 617% year-over-year. But that aside, the Q3 release looks disappointing - and investors have reacted as such. APHA stock is down 12% as of this writing.Source: Shutterstock For some investors, the revenue growth might be enough. Investors in marijuana plays like Aphria stock presumably know that it will take time for the market to develop. As a result, marijuana producers are likely to run at a loss as they build their respective businesses.But in a sector whose valuations have soared this year -- APHA stock was up 77% YTD before the release -- anything short of perfection might not be enough. And given the multitude of options investors have in the space, it's tougher after earnings to make the case for Aphria stock as the most attractive choice in cannabis.InvestorPlace - Stock Market News, Stock Advice & Trading Tips Aphria Stock EarningsRelative to year-prior periods, Aphria's growth looks impressive. Against expectations, however, the quarter seems to have fallen short. Revenue of C$73.6 million was nearly C$10 million lower than consensus. An adjusted net loss of C$0.20 per share widened year-over-year, and missed the Street by C$0.16. * 7 Mid-Cap Stocks to Find the Market's Sweet Spot To be sure, investors don't necessarily need to overreact to the shortfall against analyst expectations. Only three analysts appear to have made revenue estimates, and just one for EPS. Revenue modeling is going to be inexact for some time, given how new the industry is. And earnings at this point simply don't matter all that much: Aphria, like its peers, is investing now to build the infrastucture needed to supply existing and new markets for years to come.Even with that caveat, however, the numbers don't look particularly impressive. Most of the 600%-plus revenue growth was acquired, primarily through the recent purchase of Germany's CC Pharma. CC Pharma is a pharmaceutical distribution company with only modest cannabis exposure at this point. Aurora's production revenue rose 73%; a solid figure, but not quite spectacular in the context of a price-to-production-revenue multiple that still is over 30x.Meanwhile, those distribution revenues led margins to crash. Gross margin dropped from 47% to 18%. Aphria's own release cites very thin margins for CC Pharma: only about 4% in terms of EBITDA. That's admittedly not surprising -- most distributors have narrow margins -- but it colors the reported revenue growth.In that context, the numbers aren't as impressive as the headlines suggest. Aphria is growing its pot business - but perhaps not as fast as a $2 billion-plus valuation suggests it should be. APHA Stock Takes a Writedown-Driven HitBeyond results, the Q3 release offered two more pieces of data, neither of which looks particularly positive for Aphria stock. First, it took a C$50 million impairment on assets acquired in Latin America. Those assets were purchased just last year -- and were the subject of an investigation by short-sellers who claimed company insiders had inflated the purchase prices, and benefited in the process.APHA stock has rallied since falling on that report. But the company admitted back in February that the purchases were made "near the top of the range of observable valuation metrics." It noted, too, that its own investigation had found that directors had undisclosed conflicts of interest during the acquisition process.Now Aphria has written down the value of the assets by roughly 20%. The company still claims that it got a good price, citing a current C$225 million valuation against "the original agreed purchase price" of about C$195 million. But in a cannabis market that has soared since, a decent deal doesn't look quite as attractive. And with the company attributing the write-down to lower-than-expected margins from the business -- just a few quarters after those deals closed -- there's an obvious worry that more bad news is on the way. Aphria Stock and Green Growth BrandsThe second piece of news is that Green Growth Brands (OTCMKTS:GGBXF) has called off its attempt to acquire Aphria. The news admittedly isn't all that surprising. Green Growth's offer was odd, as Luke Lango on this site pointed out at the time. It actually valued APHA stock at less than market value -- and still does.And Aphria is getting C$89 million in cash as a result of the deal breaking through a somewhat complicated transaction. (It's basically redeeming a note it's owed by a third party, who is paying Aphria via funds raised by selling Green Growth Brands shares back to the company.) That's more funding for the company's rollout - and perhaps M&A.Still, the end of that deal raises the question: is there another potential partner for Aphria? We've seen Constellation Brands (NYSE:STZ, NYSE:STZ.B) take a stake in Canopy Growth (NYSE:CGC). Altria (NYSE:MO) has done the same with Cronos (NASDAQ:CRON). Can Aphria compete against those big boys without a well-heeled partner of its own? Better Choices than APHA?To be sure, Q3 results don't break the case for Aphria stock or marijuana stocks more broadly, but they do raise more red flags and add to the sense that investors interested in the cannabis sector might look elsewhere for value.The billions of dollars in capital backing Canopy and Cronos give those companies a notable edge. The writedown of the Latin American assets adds another risk to APHA, even with new management on board.Other stocks in the sector have fallen on Aphria's earnings. CGC stock is off nearly 4%, and CRON is down 8% as of this writing. With those stocks cheaper and Aphria disappointing, there's a case that bigger, and maybe cleaner, is better. With so much risk to APHA stock already present from a valuation standpoint, there's not much room for anything else. That's why APHA is falling today and why it might underperform for quite a while going forward.As of this writing, Vince Martin has no positions in any securities mentioned. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Internet Stocks to Watch * 7 AI Stocks to Watch with Strong Long-Term Narratives * 10 Dow Jones Stocks Holding the Blue Chip Index Back Compare Brokers The post Aphria Stock Takes a Hit After Disappointing Earnings appeared first on InvestorPlace.
My lifestyle is set up to like Keurig Dr Pepper (NYSE:KDP). What I mean by that is my wife, from Texas where the drink originated, is a lifelong Dr. Pepper drinker. We also have a Keurig coffee machine, and I'm enjoying a pod coffee as I write this … but that doesn't mean I'm going to buy KDP stock.Source: Mike Mozart via Flickr (Modified)Since it was formed at the end of July, KDP stock has outperformed its larger rivals, Pepsi (NYSE:PEP) and Coca-Cola (NYSE:KO). But its results still lackluster, and a downgrade from Morgan Stanley (NYSE:MS), which sees the single-serve coffee fad fizzling, recently sent it down by 4%.Even at that price, it's no bargain. The company's dividend of 15 cents gives it a yield of 2.19%. In a slow-growth area like beverages, you buy stocks for dividends, not growth. Despite the caffeine jolt of the Keurig merger, this remains at heart a third-rate soda company.InvestorPlace - Stock Market News, Stock Advice & Trading Tips The BackgroundKDP was formed last year when JAB Holdings, which had taken Keurig Green Mountain private in 2015 for $13.9 billion, used it and cash to buy publicly traded Dr Pepper Snapple Group. DPS stock holders got a special dividend of $103.75 per share. * 7 Marijuana Companies: Which Pot Stocks Should You Buy? The resulting company is the 4th largest U.S.-based beverage company, behind Pepsi, Coke and Constellation Brands (NYSE:STZ), the beer and wine outfit. It's the 10th largest beverage company in the world, less than half as large as Starbucks (NASDAQ:SBUX), and Nestle S.A. (OTCMKTS:NSRGY), the leaders in coffee.About one-fifth of the revenue comes from distributing other drinks, through a group called Allied Brands. After the merger, Allied lost one of its biggest sellers, Fiji Water, which decided to build its own distribution network, and bought Big Red, another Texas soda, for $200 million.It was the distribution network that attracted the German Riemann family to the company. It controls a host of coffee and restaurant brands through its JAB Holding and holds 87% of Keurig Dr Pepper. Where's the Growth?The stock got out of the gates quickly and outperformed its larger rivals until it got hit with the double-whammy this year. First came its 2018 earnings report, delivered at the end of February, and then came the Morgan Stanley downgrade.The numbers weren't bad. They just weren't great. Earnings for the quarter were $266 million, 19 cents per share, on revenue of $2.81 billion. Wall Street turned thumbs-down on the numbers, the stock falling to as low as $25 per share.A report last month that it was working with Anheuser-Busch Inbev (NYSE:BUD) on an electric cocktail machine, which sounds like the Keurig Kold machine discontinued in 2016, lifted the shares until the Morgan Stanley analysis sent them back down. After the smoke has cleared, you have the third-leading sugary soda company which, while it has a solid distribution network, is still inferior as a stock to its leading rivals. Instead of paying 50 times earnings for a company with $7.4 billion in revenue, and a paltry dividend, investors might pay just 14 times earnings for Pepsi with its 3% yield or 31 times earnings for Coke and its yield of 3.44%. The Bottom Line on KDP StockKDP stock was always a bet on growth, and its growth prospects from here are not outstanding.If Keurig really has topped out, you've got a bunch of sugary sodas and a distribution network that trails rivals and likely always will. I enjoy a cup of coffee and a sugary drink as much as the next man, but as for buying the space, look elsewhere.Dana Blankenhorn is a financial and technology journalist. He is the author of a new mystery thriller, The Reluctant Detective Finds Her Family, available now at the Amazon Kindle store. Write him at firstname.lastname@example.org or follow him on Twitter at @danablankenhorn. As of this writing, he owned no shares in companies mentioned in this article. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Internet Stocks to Watch * 7 AI Stocks to Watch with Strong Long-Term Narratives * 10 Dow Jones Stocks Holding the Blue Chip Index Back Compare Brokers The post Keurig Dr Pepper Inc Is Losing Its Fizz appeared first on InvestorPlace.
Cannabis stocks are in a holding pattern right now -- consider that the ETFMG Alternative Harvest ETF (NYSEARCA:MJ) has barely budged in the last month. Markets are waiting on the bipartisan legislation proposed in both the House and Senate to create protections for the states legalizing cannabis to play out. If the sector wins a favorable decision, it could start rallying again as it did for much of 2019. That is due to a boost in liquidity, as banks become permitted to offer services to companies in the sector.Source: Shutterstock What are the cannabis stocks that investors should watch, ahead of the government's review?Aurora Cannabis (NYSE:ACB) announced on Apr. 4 that it appointed Carey Squires as its executive vice president of Corporate Development and Strategy. Carey's experience in capital markets signals that Aurora will seek global growth and partnerships with other firms. ACB shares are up over 70% year-to-date already. The stock could see profit-taking if markets weaken overall. But with such an event impossible to predict, investors are hoping for a favorable vote on the States bill to facilitate the financing of any big deals.InvestorPlace - Stock Market News, Stock Advice & Trading TipsOn Apr. 2, Aurora filed a preliminary prospectus that will allow the company to raise $750 million over a 25-month period.On Apr. 5, the CEO of Constellation Brands (NYSE:STZ) told CNBC that Canopy Growth (NYSEQ:CGC) could make more than $1 billion in revenue by the end of its fiscal year. Constellation reasoned that Canopy can sell $5 billion to $6 billion worth of goods in Canada alone. Beverages and other edibles would add to the company's addressable market potential. * 10 Dow Jones Stocks Holding the Blue Chip Index Back Marijuana is illegal federally, but state governments have legalized it in some form in 33 states across the U.S. If more states legalize the substance, then Canopy, Constellation Brands and Aurora Cannabis could all, in turn, reward shareholders with good results.On Mar. 25, Health Canada granted Canopy Growth a cultivation license for its facility in Fredericton, New Brunswick. The facility will start production of over 5,000kg of cannabis annually. Such positive benefits to the economy and job market are something for states to look forward to from cannabis legalization.CannTrust (NYSE:CTST) could trade in a wide range after the company reported weak fourth-quarter results in the end of March. Revenue grew to 132% from last year to CAD $16.17 million. The company lost CAD $0.26 a share.CannTrust is optimistic that its revenue growth will continue in 2019, thanks to additional capacity coming online. Its Phase 2 expansion, crop yield optimization and staff training will all drive output higher. By 2020, it estimates it will add between 100,000 kg to 200,000 kg of production. Looking ahead, the company will continue developing innovative products in anticipation of the expected legalization of the edibles market in Canada in late 2019.Cronos Group (NASDAQ:CRON) has been one of the stocks to add to the "avoid list" due to its weak quarterly report. The company benefited from a CAD $2.4 billion Altria (NYSE:MO) investment, which closed in March 2019. The bad news is that the company's average selling price fell from $6.43 in full-year 2017 to $5.74 for 2018. It blamed the falling ASP on an excise task. Operating expenses also ballooned from $9.3 million in full-year 2017 to $29.4 million.Cronos has research and development activities that will take time before they pay off. Its big focus is on making sure that it has the technologies for leveraging on the rare cannabinoids and formulations to tailor them to devices. This requires the company collecting data to share with regulators so they are comfortable with it.In the end, cannabis stocks have already staged a nice rally in 2019, which increases the risk of a pull-back if investors decide to book profits. Yet any positive developments on the legalization side of the equation could re-ignite another rally in the sector.As of this writing, Chris Lau did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * FAANNG Stocks, Ranked From Cheapest to Most Expensive * 7 Stocks With a Lot on the Line This Earnings Season * 7 Marijuana Companies: Which Pot Stocks Should You Buy? Compare Brokers The post Cannabis Stocks to Watch Ahead of the States Bill appeared first on InvestorPlace.