With the Spotlight on Other Stocks, Is Now the Time to Buy Canopy Growth Corp?
Shares of Canopy Growth Corp (TSX:WEED) have doubled this year and although that’s impressive, that’s simply par for the course when you look at pot stocks. Aphria Inc (TSX:APH) has risen 116%, MedReleaf Corp (TSX:LEAF) has seen its share rise 109%, and Aurora Cannabis Inc (TSX:ACB) has grown a whopping 170%.
Canopy Growth used to be the clear favourite in the industry to invest in but now everywhere you look you see marijuana stocks taking off in price. The danger for investors is that these stocks are growing too much, too fast. With sky-high valuations there might not be a lot of potential upside left and investors that buy in now might be setting themselves up for a painful ride down.
In all likelihood we probably won’t see that happen, at least not yet. Hype may be reaching a fever pitch but there’s no reason to expect it to slow down anytime soon. Although legalization is still more than half a year away, the industry has been filling up with lots of optimism and high expectations for growth. Once pot is legal and we get a realistic picture of what growth looks like in the industry, many pot stocks might see significant corrections.
However, it still might not be too late for investors to buy shares of Canopy Growth, especially as other stocks are getting all the attention lately. Cannabis stocks have been very sensitive to news and all it takes is a big news day for Canopy Growth for its shares to take off yet again.