Post by
geodcan on Aug 13, 2023 6:31pm
Is it fair to say
that the negativety towards all marijuana stocks has resulted in gutting their sharevalues.
I daresay that Canopy was the leader of the pack on the way up and on the way down.
Is it fair? Not by a longshot!
Canopy got it's notoriety when Constellation STZ stepped up with conviction to put down $5 billion Ca for about 40% of the shares. That move upticked the stock considerably even after the steady incline that the shares were getting.
They also coached the deal that Canopy did with Acreage which made perfectly good sense for Canopy to expand their International footprint to the US.
Acreage was an established US MSO that was put together by an acquisitor who just wanted all the pieces of the marijuana and hemp business to be a MSO of merit.
Then came the change from irrational exuberance valuations to the more reasonable balance sheet which showed massive overpaying for purchases of the companies that were being consolidated in to MSOs and LPs.
It would have been wonderful if Canopy and Acreage held the exuberance valuations they had but it is what it is.
So STZ didn't dump shares but went on a buying spree. I think originally that STZ was securing the Canopy line of cannabinoid infused beverages but realized that there is much more to this industry than just beverages and started taking positions in brand leading companies, some pot related and some with other profitable potential secured by brands.
The poster who advised another poster that $1 dollar shareprice was a sure thing might be a little light.
I want to think that when Klein solves the financial drain on the Canadian side and completes the joining of Canopy and Acreage on the US side that we could see the old highs of $70. That is my wish anyways.
When Klein continued to pile in to new ventures he did it at very reasonable prices because everybody was valued at lowball prices as the weak investors preserved capital by dropping trow.
This is already a huge valued business that isn't going away but needs a lot of it to dissappear to get supply and demand sorted out to something reasonable.
It isn't going to be good for growers or most small operators, especially those that aren't legitimate, good corporate businesses.
My gut tells me that the LPs are on sale right now and the MSOs have already had some success despite the clusterfuch of State laws that prevail on US soil.
Klein chose Canopy who chose Acreage for their American footprint and didn't stop there but also have intentions of merging some other great cannabinoid brands in to newly id'd company to be known as Canopy USA. (CUSA) I have heard mentioned may be the new symbol if it stays publicly traded.
I don't think that Constellation is going to walk from more than $5 billion C plus the other investments they have made for those branding companies and control of Canopy and Acreage.
Constellation's shareholders aren't showing any concern either as Constellation's shares have jumped hugely as has their marketcap.
A new id'd company for Canopy keeps Constellation once removed from any downside that could happen if the market keeps pounding LPs and MSOs. That is good business on the part of Klein protecting STZ shareholders but doesn't eliminate them from topping up working capital for Canopy, if it is needed.
I don't know if this right-sizing evaluation is being orchestrated by the major shareholder or marketmakers. The cheaper evaluations have allowed STZ to take control of Canopy and Acreage and buy in to Jetty, Martha, Stors and Bickell, Wana and Gage for the big picture story.
Klein thinks that they can do it and have put up a ton of money to be the benefactor of Canopy putting down footprints in the US.
That is first and if we get decriminaliztion or SAFE or anything to advance support for a US greenrush that will help most of the players but may just prolong the agony that the underfinanced are going to see.
Money and the ability to raise it is the Ace in the hole right now and wild card money is expensive as in like usury rates.
I think Constellation has that covered!
glta and dyodd
Comment by
charlie007 on Aug 13, 2023 8:23pm
on the bright side if they do a 100 to 1 reverse split it'll be back to $50 !