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Canopy Growth: What to Expect from Its Earnings Today

Sushree Mohanty - Author

Aug. 28 2019, Updated 3:05 p.m. ET

Canopy Growth (CGC) (WEED) is scheduled to announce its results for the first quarter of fiscal 2020 after the market closes on Wednesday. The company’s management will conduct a conference call to discuss results at 8:30 AM ET on Thursday.

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Canopy Growth stock in 2019

So far, the stock has been performing well this year. Canopy Growth stock has risen 27.2% YTD (year-to-date). Cronos Group (CRON) has gained 27.8%, while Aurora Cannabis (ACB) has gained 22.3% YTD.

This week has been exciting for cannabis stocks. Major cannabis players have reported their earnings. The stocks have risen due to impressive results. To know more, read IIPR, CRON, TLRY Surging: A Good Day for Cannabis Stocks.

Analysts’ expectations

For the first quarter of 2020, analysts expect Canopy Growth’s sales to rise 30.3% sequentially to 122 million Canadian dollars from 94 million Canadian dollars. Notably, they expect the company’s gross margin to grow sequentially from 15.9% from 34.0%. Analysts expect the company’s loss per share to improve sequentially to 0.59 Canadian dollars from 0.98 Canadian dollars. Expansion costs will likely drive the loss. There will likely be some leadership updates in Canopy Growth’s earnings call due to Bruce Linton’s departure. Analysts expect Aurora Cannabis’s (ACB) revenues to rise in the upcoming quarter to 108 million Canadian dollars. Aurora Cannabis is scheduled to report its earnings for the fourth-quarter of 2019 next month.

To learn more about Canopy Growth’s earnings, read Canopy Growth’s Earnings: 5 Things to Watch For.

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Canopy Growth’s stock price performance

So far, Canopy Growth has risen 4.7% this month. Tilray (TLRY) has risen 12.7% in August. Aurora Cannabis (ACB), Aphria (APHA), and HEXO (HEXO) have risen 6.7%, 27.6%, 16.3% and 20.1% in August. In contrast, CannTrust (CTST) has fallen 5.1% in August due to violating regulations.

Price coverage

Currently, only two analysts cover Canopy Growth. According to data from Reuters, one analyst recommended a “strong-buy” for the next 12 months, while one recommended a “hold.” Canopy Growth’s stock forecast shows the target price set at $46.5, which represents a 36% upside potential for the stock. As of the close on Tuesday, Canopy Growth’s stock price is $34.2.

Peers’ performance

Cronos Group reported impressive second-quarter earnings results last week. Overall, the results drove the stock price higher. Recently, Jim Cramer, the host of CNBC’s Mad Money, favored Cronos Group and Canopy Growth over other cannabis stocks. Read Why Jim Cramer Favors CRON and CGC to learn more.

Aurora Cannabis (ACB) is scheduled to report its results for the fourth quarter of 2019 next month. The stock rose 1.5% on Tuesday. So far, the stock has risen 34.1% YTD. Cresco Labs is scheduled to report its second-quarter earnings results on August 21. The stock trades on the Canadian Stock Exchange under the ticker “CL.” The stock rose 17.0% on Tuesday. The company got approval for the New York marijuana license deal, which drove the stock. So far, Cresco Labs has risen 32.4% YTD.

On August 8, Innovative Industrial Properties (IIPR) reported strong results for the second quarter of 2019. The stock rose 7.8% on Tuesday. So far, Innovative Industrial Properties has returned 136.6% YTD.

To learn more, read IIPR’s Q2 Earnings Call: Key Takeaways for Investors and Why IIPR’s Q2 Earnings Came in Strong.

Read Cannabis Industry: What’s the Next Phase? to learn more about the cannabis sector. Read Which Are the Best Cannabis Stocks in August? for more industry updates in August.

Stay tuned for more insights into Canopy Growth’s performance in the first quarter of 2020. We’ll provide key takeaways from the company’s earnings call.

Update: Check out our analysis of the results in Canopy Growth Stock Tanks after Q1 Earnings.


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