Canopy Growth’s (WEED) stock has been given a price target of “zero” as the Canadian cannabis producer’s financial situation deteriorates and concerns are raised about the company’s ability to continue operations.
Analysts at U.S. investment bank Benchmark dropped their price target on Canopy Growth’s stock to “zero,” noting that the company is burning cash as it struggles with a turnaround strategy that has seen it layoff staff and close cannabis production facilities across Canada.
Canopy Growth’s share price has declined nearly 80% this year and is now at just $0.68. The company’s market capitalization has fallen to $400 million from $25 billion in 2021.
In a note to clients, Benchmark said Canopy Growth’s management team is unlikely to be able to successfully turnaround the cannabis producer and its future is in doubt.
Canopy Growth raised a “going concern” risk to investors after it recently reported a quarterly net loss of $648 million, the latest in a string of poor financial results.
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