CGC Stock Outperforms on Better Financial Stability

CGC stock

The cannabis industry has been in all sorts of trouble for much of the past 12 months, and many companies now find themselves on the precipice. However, there is one stock that has the wherewithal to weather this storm and continue to conduct its business efficiently. That company is Canopy Growth (TSX:WEED) (NYSE:CGC).

Canopy Growth is one of the most valuable companies in the industry, and in its recent earnings, Canopy turned its business around somewhat. Here is a closer look at the company’s business.

Financial Performance

Canopy's financial performance in the fiscal third quarter may not have been spectacular, but the company did manage to show certain improvements. Losses dropped from $156 million in the year-ago period to $92 million, and recreational marijuana sales in Canada showed a 10% rise. Some of the company’s key strategic acquisitions, such as BioSteel, This Works, and Storz & Bickel, also performed well. Those units contributed 22% to the overall revenue.

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CGC stock jumped by 5.90% to $14 on the NYSE in the early morning session on Tuesday.

David Klein, the Chief Executive Officer of Canopy Growth, stated that the road ahead is not going to be easy. He said that Canopy will need to connect with consumers and eventually become a profitable organization.

More importantly, Klein stated that since Canopy is now a Constellation Brands (NYSE:STZ) subordinate, there is no chance of the cannabis giant running out of cash. That is a significant advantage at a time when many other companies in the industry are struggling for cash.

Cannabis-Based Beverages

The company is also going to launch its much-anticipated cannabis-based beverage line this year. Experts believe that such beverages have the potential to be the next big thing in the cannabis industry. By doing so, Canopy Growth is trying to leave behind the days of massive cash burn and poor sales.

What do you think about CGC stock?

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