In a recently released analyst research report, Piper Sandler Senior Research Analyst covering packaged food, tobacco, and cannabis, Michael Lavery, downgraded his outlook on shares of Canopy Growth Corp. (TSX:WEED) (NYSE:CGC) from Overweight to Neutral with a price target that suggests some serious downside to come.
This downgrade comes a day after Canopy announced that its Canopy Animal Health division has launched a line of CBD products for dogs.
Michael Lavery’s price target of $27.00 USD per share implies a potential downside of approximately 37.95% based on the last traded price of $43.51 USD per share on the NYSE pre-market.
“Canopy shares are up 215% since October, likely driven by improving sentiment around cannabis and potential for U.S. legalization following the elections, Lavery tells investors in a research note. The company currently trades at 21 times estimated 2022 sales, says the analyst, who does not see further upside to valuation based on fundamentals. Federal legalization of marijuana in the U.S. could still be two years away, Lavery adds,” reports TheFly.
To the contrary, the State of Wisconsin Investment Board disclosed that it increased its stake in CGC.
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