There were a few cannabis stocks that kicked off Monday relatively well, with Canopy Growth (TSX:WEED) (NYSE:CGC) leading the way. At the time of writing, CGC stock is up more than 6%.
While there are a few reasons CGC stock is in the green today, many are attributing it to two recent notes from analysts who appear to have taken a bullish stance on the cannabis company.
CGC Stock Up on Analyst Notes
Announced last week, Canopy Growth has purchased the rights to acquire Acreage Holdings (OTCQX:ACRGF). The move led Martin Landry, a GMP analyst, to upgrade CGC stock to buy. Landry previously had Canopy Growth stock at hold. The analyst also increased his stock price target, going from $65 to $72. According to Market Watch, this is roughly 21% above the stock's current trading level.
In a note to clients, Landry wrote: “This transaction should boost Acreage’s ability to consolidate the U.S. market." As a result, "when Canopy officially takes ownership of Acreage, it could be much larger than currently.”
>> MedMen Stock: Top Executives Resign in a Major Employee Shakeup
Landry, however, is not the only bullish analyst that has surfaced since last week's announcement. Already rating CGC stock a buy, Mike Hickey, a Benchmark analyst, said the Canopy-Acreage deal highlights "a path for the U.S. cannabis market.”
Just as Landry isn't the only one feeling optimistic, neither is Mike Hickey. On April 21, Tamy Chen, an analyst for BMO Capital Markets, said the Canopy-Acreage agreement gives Canopy Growth “a sizable U.S. platform upon legalization.”
Details on the agreement are here, but it's worth noting again that CGC won't acquire full ownership of Acreage Holdings until cannabis is legalized at the federal level in the United States.
CGC Stock Today
At the time of writing, according to Yahoo Finance, CGC stock is trading at $47.38 on the New York Stock Exchange, which puts the cannabis stock up 6.32%.
Meanwhile, on the TSX, as of 12:57 PM, WEED stock was trading up 5.58%.
Takeaway
What do you think about CGC stock being bumped from hold to buy? Should Landry have increased his price target as much as he did? Let us know what you think in the comments below!
Featured image: Canva
