Canopy Swelling
Tom Franck | CNBC
With shares down more than 60% over the last six months, it’s tough to tarry pessimistic on marijuana grower Canopy Growth, according to Bank of America Merrill Lynch.
The brokerage upgraded the Canadian cannabis organizer to buy from neutral on Wednesday and told clients that the stock’s 2019 swoon has tempered valuation and earnings determines to more reasonable levels.
“Street estimates [are] achievable (even beatable) for maybe the first time in Canopy’s background as a public company,” analyst Christopher Carey wrote in a note. With leaner channel inventory and improving retail statistics ahead, “a bear case based on multiple compression and to a certain extent cash burn (despite still years of bread) seems less robust now.”