Fact based stock research
Canopy Growth (TSX:WEED)
CA1380351009
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For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Canopy Growth stock research in summary
ANALYSIS: With an Obermatt Combined Rank of 10 (worse than 90% compared with investment alternatives), Canopy Growth (Pharmaceuticals, Canada) shares have lower financial characteristics compared with similar stocks. Shares of Canopy Growth are a good value (attractively priced) with a consolidated Value Rank of 54 (better than 54% of alternatives) but show below-average growth (Growth Rank of 9), and are riskily financed (Safety Rank of 30), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 10, is a sell recommendation based on Canopy Growth's financial characteristics. As the company Canopy Growth's key financial metrics exhibit good value (Obermatt Value Rank of 54) but low growth (Obermatt Growth Rank of 9) and risky financing practices (Obermatt Safety Rank of 30), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 54% of comparable companies, may indicate the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
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360° ViewnewThis stock has achievements: Top 10 Stock.
18-Apr-2024. Stock data may be delayed. Log in or sign up to get the most recent research.
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Review the performance ranks of the individual metrics that form each investment strategy.
Research History: Canopy Growth
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 11 |
|
67 |
|
40 |
|
54 |
|
| GROWTH | ||||||||
| GROWTH | 26 |
|
67 |
|
13 |
|
9 |
|
| SAFETY | ||||||||
| SAFETY | 13 |
|
52 |
|
54 |
|
30 |
|
| SENTIMENT | ||||||||
| SENTIMENT | n/a |
|
37 |
|
10 |
|
new |
|
| 360° VIEW | ||||||||
| 360° VIEW | n/a |
|
77 |
|
4 |
|
new |
|
Combined financial peformance in Detail
ANALYSIS: With an Obermatt Combined Rank of 10 (worse than 90% compared with investment alternatives), Canopy Growth (Pharmaceuticals, Canada) shares have lower financial characteristics compared with similar stocks. Shares of Canopy Growth are a good value (attractively priced) with a consolidated Value Rank of 54 (better than 54% of alternatives) but show below-average growth (Growth Rank of 9), and are riskily financed (Safety Rank of 30), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 10, is a sell recommendation based on Canopy Growth's financial characteristics. As the company Canopy Growth's key financial metrics exhibit good value (Obermatt Value Rank of 54) but low growth (Obermatt Growth Rank of 9) and risky financing practices (Obermatt Safety Rank of 30), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 54% of comparable companies, may indicate the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 11 |
|
67 |
|
40 |
|
54 |
|
| GROWTH | ||||||||
| GROWTH | 26 |
|
67 |
|
13 |
|
9 |
|
| SAFETY | ||||||||
| SAFETY | 13 |
|
52 |
|
54 |
|
30 |
|
| COMBINED | ||||||||
| COMBINED | 23 |
|
83 |
|
16 |
|
10 |
|
Value Metrics in Detail
ANALYSIS: With an Obermatt Value Rank of 54 (better than 54% compared with alternatives), Canopy Growth shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators where three out of four are below average for Canopy Growth. Only the Price-to-Book Capital ratio (also referred to as market-to-book ratio) indicates good stock value with a Price-to-Book Rank of 57, which means that the stock price is lower compared with invested capital than for 57% of comparable investments. All other value indicators are below the market median. Price-to-Sales is 42 which means the stock price compared with what market professionals expect for future profits is higher than 58% of comparable companies, indicating a low value concerning Canopy Growth's revenue levels. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Book Rank of 57 and for the dividend yields rank which is lower than for 99% of comparable companies, making the stock more expensive as regards to with the company's expected dividend payouts. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 54, is a buy recommendation based on Canopy Growth's stock price compared with the company's operational size and dividend yields. Why are market participants paying such a high price for Canopy Growth, where three out of four value indicators are below par? One reason could be that the company is well financed, indicated by the high book capital level, and has a promising future that is not yet visible in reported revenues and profits. That would also explain the low dividend yield because the company needs the cash to invest in its future. If investors can verify a picture in this sense, the stock may still be a good investment, even though current company-reported financials don't fully explain current stock prices. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more
| VALUE METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| PRICE VS. REVENUES (P/S) | ||||||||
| PRICE VS. REVENUES (P/S) | 21 |
|
34 |
|
72 |
|
42 |
|
| PRICE VS. PROFITS (P/E) | ||||||||
| PRICE VS. PROFITS (P/E) | 1 |
|
n/a |
|
n/a |
|
|
|
| PRICE VS. CAPITAL (Market-to-Book) | ||||||||
| PRICE VS. CAPITAL (Market-to-Book) | 74 |
|
90 |
|
13 |
|
57 |
|
| DIVIDEND YIELD | ||||||||
| DIVIDEND YIELD | 1 |
|
1 |
|
1 |
|
1 |
|
| CONSOLIDATED RANK: VALUE | ||||||||
| CONSOLIDATED RANK: VALUE | 11 |
|
67 |
|
40 |
|
54 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 9 (better than 9% compared with alternatives), Canopy Growth shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four metrics below average for Canopy Growth. While Profit Growth has a good rank of 91, as professionals currently expect the company to grow its profits more than 91% of its competitors, all other growth indicators are below market averages. Sales Growth has a rank of 9, which means that currently professionals expect the company to grow less than 91% of its competitors, while Capital Growth has a rank of 1 and Stock Returns have been below market median, with a rank of 18 (82% of alternative investments were better). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 9, is a sell recommendation for growth and momentum investors. While revenue growth and capital growth are good growth momentum indicators, profit is less reliable, because profits may increase due to cost-cutting measures which typically indicate negative growth momentum. "You can save a dollar only once" is the saying about such situations. Growth Investors should look at company priorities closely if they are interested in growth, because the increase in profits is not usually an indicator of growth, and stock prices have been below market, too. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is limited here. ...read more
| GROWTH METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 26 |
|
41 |
|
34 |
|
9 |
|
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 8 |
|
86 |
|
94 |
|
91 |
|
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | n/a |
|
82 |
|
1 |
|
1 |
|
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 6 |
|
7 |
|
9 |
|
18 |
|
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 26 |
|
67 |
|
13 |
|
9 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 30 (better than 30% compared with alternatives), the company Canopy Growth has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Canopy Growth is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Canopy Growth and the other two below average. Refinancing is at 55, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 55% of its competitors. But Leverage is high with a rank of 19, meaning the company has an above-average debt-to-equity ratio. It has more debt than 81% of its competitors. Liquidity is also on the riskier side with a rank of 35, meaning the company generates less profit to service its debt than 65% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 30 (worse than 70% compared with alternatives), Canopy Growth has a financing structure that is riskier than that of its competitors. A good Refinancing Rank means that the problems of the company may not be around the corner. But high Leverage is only good if things go well, and low Liquidity is a signal for caution. The financing signals for Canopy Growth are on the riskier side, requiring the company's future to be on the safer side. Investors may want to look at Growth and Sentiment ranks before making an investment decision. In the long-term, investors may have a debt challenge with Canopy Growth and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more
| SAFETY METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 50 |
|
53 |
|
17 |
|
19 |
|
| REFINANCING | ||||||||
| REFINANCING | 56 |
|
87 |
|
75 |
|
55 |
|
| LIQUIDITY | ||||||||
| LIQUIDITY | 5 |
|
12 |
|
46 |
|
35 |
|
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 13 |
|
52 |
|
54 |
|
30 |
|
Sentiment Metrics in Detail
| SENTIMENT | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| ANALYST OPINIONS | ||||||||
| ANALYST OPINIONS | n/a |
|
6 |
|
3 |
|
new |
|
| OPINIONS CHANGE | ||||||||
| OPINIONS CHANGE | n/a |
|
57 |
|
50 |
|
new |
|
| PRO HOLDINGS | ||||||||
| PRO HOLDINGS | n/a |
|
56 |
|
59 |
|
new |
|
| MARKET PULSE | ||||||||
| MARKET PULSE | n/a |
|
66 |
|
3 |
|
new |
|
| CONSOLIDATED RANK: SENTIMENT | ||||||||
| CONSOLIDATED RANK: SENTIMENT | n/a |
|
37 |
|
10 |
|
new |
|
Stock analysis by the purely fact based Obermatt Method for Canopy Growth from April 18, 2024.
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