CGC has been a serial underperformer since 2018 but it’s looking increasingly like the stock formed a major low in late 2022. From a valuation perspective, at face value, it is not overly compelling on 19x while being estimated to yield 4.5% over the next 12 months, it’s important to highlight the leverage in these sorts of stocks – when things are good, they can be very good and far exceed ingrained expectations.
At May’s AGM the company provided a positive trading update, they talked about improving trends in Mushrooms and Tomatoes while their international operations are delivering very strong results from both China and Morocco
- We believe the next 20% move for CGC is on the upside providing solid risk/reward under $2.70.
MM likes CGC around $2.65
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