LAST ONE OUT TURN OUT THE LIGHTSWell Clowns, your lesson continues. Because you just don't get it, let me explain how this rolls out from here.
1) Frum Schumer himself, this legislation that was introduced has a timeline almost a year away, and he is already admitting the votes aren't there.
2) This is absolute GOLD for the shorts, as there just isn't ANYTHING to get excited about in the sector. Shorts will ramp massively ramp up their short position with next to nothing to worry about.
3) Canopy is vulnerable. Bluntly, they can't afford this kind of timeline or messaging from Schumer, as their cash burn is completely unsustainable.
4) Cue the dillution. Shorts know this, so will short even more, which will make the dillution even more. It's the perfect feedback loop for them.
5) Canopy will have to put out shares at a significant discount, on top of the discount orchestrated by the shorts. The dillution will probably be discounted 10-15% off whatever the current market price is when they announce it. Again, more pure gold for the short position.
6) This will cascade into people barfing up shares and/or margin calls. The price drops even further. At that point, the shorts might consider starting to cover, but with no rush and no fear.
I get it. It's not fun admitting you've been wrong here. But don't make the next biggest newbie mistake, saying things like "I don't want to sell at a loss." If there's another 20%-30% downside to the stock, get out and circle around if you really want. But don't just sit there like a deer in the headlights "wishing" this bad dream will end. It's NOT a dream. It IS reality. The best decisions are NEVER made using how much you've won or lost as a point of determination for buying or selling. Look at the stock and where it's at, and consider the forces at play.