Post by
mrmomo on Feb 10, 2023 9:27am
Some wise counsel for you folks....
For those of you who are STILL invested in this sector, this company, after that financial report, listen carefully to the following if you ever wish to recover ANY of the monies you've invested here.
As many of you folks know, or at least those that follow my commentaries, i've been telling/calling investors to completely avoid this sector for the past THREE years. If you followed that advice, you're a very happy & relieved person who just saved himself a tonne of money and avoided horrendous losses. IF you did not, well, you're in deep DooDoo with some serious paper losses or real massive ones if you threw in the flag at some point in those 3 years. I tried telling folks to GET TH OUT multiple times over that period, on this board & several others, so it's not for the lack of trying on my end. Therefore that blame should be put squarely on your own shoulders and any idiot who convinced you to stay invested or worse to continue buying more to DCA.
So.....do you want some of that money back? Then listen to following. But before i begin and give you my wise advice, just a few notes for those mule headed folks that are STILL not convinced LOL and will continue to hold this stock for eternity, until "death to us part". After that report by Canopy yesterday, it is VERY clear what mgmt will do next. If you haven't grasped YET what they're doing, they've been implementing massive cost cutting controls by slimming down ops, massive layoffs and refocusing/reinventing the company. All this will NOT help NOW and will only be felt in about a year or so. Their biggest problem, and something which they didn't & probably hesitated to touch, is their very massive debt problem. But now they will......
And trust me folks, you don't want to be caught in the middle or holding the stock when they take the very agreesive, drastic and appropriate measures to resolve that problem. They really have NO choice now, it's either that or die. And the latter is not a viable option for them, their backers or their s/h. As stated in my previous post, they have about $500M cdn left in cash with some additional financial liquid assets. This is not sufficient liquidity to last more than 2 quarters. But in conjuction with their ATM tool, they could "technicallly" continue to operate much longer by raising cash in the market and massively diluting s/h. Which they will continue to do, btw, no doubt at all on that end. As it stands right now, they have about 500M o/s up from about 375M a year ago, and will continue to climb up significantly to the detriment of holders.
The way i see it, Canopy's equity is totally worthless at this point, there no value left. All the value the company has left is in the debt. That massive ~1,2B debt load, which is almost all bank debt which can't even be converted to equity strafght out or force/"enourage" those debt holders to convert. The debtor in this case is the bank. So the only way to completely wipe out that debt in one fell & decisive swoop, is to find a willing investor to pony up the money through issuance of addtional equity. And usually, a company will approach their main backers FIRST, for several reasons.
And this is where we are it right now, and i won't be surprised if Canopy is already in advanced discussions with their main supporters/backers to consumate a deal soon. ImHo, what will happen here is what Aurora Cannibis did a few years ago to deal with their own huge debt problems. The only questions that remain is not IF BUT when and at what cost to s/h? My guess a deal will be struck, but at at levels A LOT lower than we are currently trading. Much MUCH lower that much is certain.
So if you want to recoup your money, ACT NOW before it is too late. Though for most you selling now the losses are great, they will be much worse if you do absolutely nothing. At the very least if you do NOT consider what i will offer you, you should at least sell the stock and stay in cash to preserve what little you have left. But if you're willing to take my advice, then i'll gladly offer it to you and hope you recover some your losses. So this is what i rec'd you do. The Pot sector & Canopy are dead so you need to replace that with a sector & stock where the valuations are not only resonable, but the future reamins somewhat bright/optimistic. That's why i will suggest the Oil & GAS sector. The companies have been beaten down BUT the environment & investor sentiment still remains fairly good/decent. In the very very long term i'm not very keen on the industry but in the short to mid term or 3 months to a year, things look good for a nice recovery.
In other words my friends, the risk/reward for an investment in the O&G sector right now is very entciing and extremely favorable. So for those of you who are willing to take the rsik and make the switch, the stock i will offer you/rec' to you is the same one i'm invested in as well, the company is Pipestone (PIPE). It doesn't have the following, pizzaz or allure that a Canopy has/had BUT it WILL do one thing that Canopy cannot do right now, and that's recover SOME of the money you lost here in a very short period. In about 6 months or so, you will thank me that you took the risk & made the chnage. That's my wise recommendation to you folks. Your choice on what you do next!
GLTA