Canopy Growth Misses Profit and Revenue Estimates in Q1

Canopy Growth Corp

Canopy Growth Corporation (TSX:WEED)(NYSE:CGC) reported a quarterly loss of $0.70 per share as opposed to the $0.20 loss predicted by the Zacks Consensus Estimate. In contrast, a year ago, there was a loss of $0.13 per share. These numbers have non-recurring expenses taken into account.

This quarterly report indicates a -250% profit surprise. Canopy Growth surprised analysts by -75% last quarter when it posted a loss of $0.42 per share as opposed to the $0.24 per share that was anticipated.

The company has just once outperformed consensus EPS forecasts in the previous four quarters.

For the quarter that ended in June 2022, Canopy Growth reported revenues of $86.29 million, which were 0.02% below the consensus estimate. In contrast, last year’s revenues were $126.53 million. In each of the previous four quarters, the company has just once exceeded consensus revenue projections.

Shares of Canopy Growth have fallen by around 66.9% since the start of the year, compared to the S&P 500’s decrease of -12.9%.

What Will Happen to Canopy Growth Next?

Investors are wondering what will happen to the company even though Canopy Growth Corporation has lagged the market so far this year.

This important topic doesn’t have simple answers, but one trustworthy metric that can assist investors in answering it is the company’s profits outlook. This includes the most recent changes to consensus earnings forecasts and the current consensus earnings predictions for the upcoming quarter(s).

According to empirical studies, patterns in earnings estimate revisions and short-term stock movements are strongly correlated.

Canopy Growth’s estimate revisions tendency was inconsistent before the release of these earnings. The shares are anticipated to perform in line with the market in the near future.

In the days to come, it will be interesting to see how forecasts for the current fiscal year and upcoming quarters evolve. For the upcoming quarter’s revenues of $91.94 million and the current fiscal year’s revenues of $383.21 million, the consensus EPS estimate is currently set at -$0.18 and -$0.70, respectively.

Investors should be aware that the outlook can significantly impact the performance of the stock for the industry.

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About the author: Stephanie Bedard-Chateauneuf has over six years of experience writing financial content for various websites. Over the years, Stephanie has covered various industries, with a primary focus on tech stocks, consumer stocks, health stocks, and personal finance. This stock lover likes to invest for the long-term. Stephanie has an MBA in finance.