MW Canopy Growth's stock falls to all-time low on pot company's share-sale plans
By Steve Gelsi
Stock price drops more than 7% after cannabis seller says it will sell up to $200 million in stock
Canopy Growth Corp.'s stock fell 9% to an all-time low on Monday after the cannabis company said it would sell up to $200 million of its stock.
Based on the company's current market capitalization of about $240 million, Canopy Growth's stock offering would nearly double the dollar amount of its stock now trading on the Nasdaq and the Toronto Stock Exchange .
Canopy Growth's stock $(CGC.AU)$ (CA:WEED) fell to 12 cents to $1.27 a share in recent trading.
The Smiths Falls, Ont.-based company said after the closing bell on Friday that it will sell the stock in the U.S. and Canada from time to time at market prices.
Canopy Growth plans to use proceeds from the stock sale for general corporate purposes including debt repayment and building up its cash position and for potential acquisitions or mergers.
The stock's drop comes even after the company closed a 1-for-10 reverse stock split late last year.
Canopy Growth has yet to generate a profit and has faced competition in the Canadian market.
Although the company has exposure to the larger U.S. cannabis market through its ownership of Jetty Extracts, Wana Brands edibles and Acreage dispensaries, investors have not been bearish on cannabis stocks due partly to stalled reforms on the U.S. federal level.
Last month, Canopy Growth reported a narrower third-quarter loss of C$121.9 million ($85 million), or C$1.11 a share, from a loss of C$216.8 million, or C$2.62 a share, in the year-ago period.
The company missed the FactSet consensus estimate for a loss of 52 cents Canadian a share.
Revenue fell 5% to C$74.76 million, ahead of the FactSet consensus estimate of C$69.1 million.
Also read: Cannabis sector limps into 2025 as 'the gold rush is over'
-Steve Gelsi
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March 03, 2025 12:18 ET (17:18 GMT)
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