Only fools rush in......Hopefully none of who at least follow my advice on this board, were idiotic enough too fomo blindly into this last run up here. These financials are EXACTLY as i expected them to be and ohhh boy were they ever.! That insane but highly expected impairment charge has finally arrived, and which i assume will the first of many others to come. But more importantly, Canopy continues to remain totally unprofitable, just unable to turn one single $1 by selling product at this time. As unprofitable as many others in the industry, others who are better positioned than they are, better managed and in a much better financial state also. So if the best of the best can't make money, how could Canopy possibly do so? Just simple logic & math in my book.
What should be both a relief & worrisome for any holder of Canopy stock is the following. Due to its large cash position, which is slowly dwindling btw, it has literally saved the company from BK. If it wasn't for this fact, the company would have folded or been sold peice by piece a long time ago. But this alone isn't enough to save the company. As seen by the financials, Canopy is now being forced to liquidate their investments to extend their cash position a little longer. Though this might delay the inevitable, it will not save the company from it's core issues. The issue of not being able to generate a positive cash flow by selling product at reasonable, profitable prices. And this due to several factors, overhead costs & problems at the market level. The latter being complicated by massive taxation & unable to compete with a flourishing blackmarket.
So until these problems are dealt with, don't expect for Canopy or anyone else to be profitable. Therefore, this of course will be reflected in the stock price as well, which i expect to continue its slow decay to lower levels. The burning question here is this, does Canopy have enough cash to survive until those problems are fixed? It seems from the looks of it they'll be able to survive this at least year, but 2023 is still doubtful. Not without implementing some massive restruturing in the company for them to make it through 2023 & beyond. As i STILL fully expect to happen sometime in mid to late 2023. It seems they are buying their time, but how much of it they have left is anyone's guess.....
GLTA