Crashing Canopy Growth Is Still Not A Buy

(12min)

Summary

  • Canopy Growth's stock has plummeted over 90% in a decade, with further declines expected due to ongoing financial struggles and lack of U.S. market progress.
  • Despite potential short-term gains from filling price gaps, Canopy Growth remains a Strong Sell due to its unprofitability and high debt levels.
  • Constellation Brands is unlikely to buy Canopy Growth, given its previous failed investment and current financial structure.
  • There are better investment opportunities in cannabis stocks, both in Canadian LPs like Organigram and Village Farms, and U.S. MSOs like Cresco Labs and Verano Holdings.
  • Looking for a portfolio of ideas like this one? Members of 420 Investor get exclusive access to our subscriber-only portfolios. Learn More »
hemp leaf on background of the canadian flag. Concept of legalization and changes in legislation regarding cultivation and use of marijuana in the country canada

Diy13

I can't say many good things about Canopy Growth (NASDAQ:CGC), except that it is entirely focused on cannabis. I last wrote about it after they reported their fiscal Q2 in November, suggesting that investors should avoid Canopy Growth

420 Investor launched in 2013, just ahead of Colorado legalizing for adult-use. We have moved the service to Seeking Alpha. Historically, we have provided great coverage of the sector with model portfolios, videos and written material to help investors learn about cannabis stocks, and we are excited to be doing it here!

This article was written by

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Alan Brochstein, CFA, is one of the first investment professionals to focus exclusively on the cannabis industry. Alan got his start as a financial professional in the securities industry in 1986, managing investments in institutional environments until he founded AB Analytical Services in 2007 in order to provide independent consulting to registered investment advisors. He is also the managing partner of New Cannabis Ventures, a leading provider of relevant financial information in the cannabis industry since 2015.

Alan has run the investing group 420 Investor, for investors interested in the publicly-traded cannabis stocks that he moved to Seeking Alpha in 2023, since 2013. As the leader of the investing group 420 Investor, Alan closely covers 23 stocks and shares investment news as it comes out, previews of their earnings reports and analysis of them afterwards. Other features of the group include: 2 model portfolios, 10 videos per week with chart analysis, 3 summary pieces weekly, a monthly newsletter, and chat for questions Learn More. He also offers a sub-service of 420 Investor, The Big Picture, which will help you stay on top of the cannabis sector!

Analyst’s Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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