17 Aug

Canopy Growth: Positive Catalysts Lead to Upgrades

WRITTEN BY Adam Jones

Canopy Growth’s catalysts

Canopy Growth (WEED) (CGC), the biggest cannabis producer in terms of capacity, released its earnings on August 14. The company experienced 63% year-over-year growth, but reported a net loss due to continued investments to capture the recreational cannabis market (MJ). Usually, when the company makes capital expenditures, earnings are expected to grow in the future.

On August 15, Canopy Growth stock rose as much as 30% on news that Constellation Brands (STZpumped ~$4 billion into the company.

With these positive catalysts, Canopy Growth received target price upgrades from four firms.

Canopy Growth: Positive Catalysts Lead to Upgrades

PI Financial

On August 15, PI Financial raised its target price for Canopy Growth to 60 Canadian dollars from 45 Canadian dollars. The increased target price translated into an increase of almost 33% from the previous target price. The stock, which was trading at 41.3 Canadian dollars as of August 16, has ~45% upside if the price converges with PI Financial’s target. The company has a “buy” rating on the stock.

Recently, PI Financial raised its target price on Aphria (APHQF) after its fourth-quarter earnings to 28 Canadian dollars from 26 Canadian dollars.

Canaccord Genuity

On August 16, Canaccord Genuity increased its target price on Canopy Growth to 50 Canadian dollars from 34 Canadian dollars, which translates into a 47% increase from its previous target. The company also raised its rating to “speculative buy” from “hold.”

Next, we’ll discuss two more firms that raised Canopy Growth’s target price.

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