How These 2 Nasdaq-Listed Marijuana Companies Found A Way To Raise $250M Without Tanking Their Stock
Portfolio Pulse from Nicolás Jose Rodriguez
Canopy Growth (NASDAQ:CGC) and Tilray (NASDAQ:TLRY) have initiated $250M At-The-Market (ATM) equity issuance programs, which allow for incremental share sales at current market prices, potentially reducing stock pressure compared to traditional equity issues. Canopy's stock fell 8.45% following the announcement, but the decline would have been steeper with a regular equity issue. Both companies trade at premiums to the group's market-to-tangible book value median, with Canopy showing better year-to-date performance due to its U.S. acquisitions.
June 07, 2024 | 9:32 pm
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Canopy Growth (CGC) announced a $250M ATM equity issuance program, causing an 8.45% drop in stock price. The decline would have been steeper with a traditional equity issue. Canopy's market-to-book ratio indicates extensive write-downs of intangible assets.
The ATM program allows for incremental share sales, reducing immediate stock pressure. However, the announcement still led to an 8.45% drop in CGC's stock price, indicating investor concern.
CONFIDENCE 90
IMPORTANCE 80
RELEVANCE 100
NEUTRAL IMPACT
Tilray (TLRY) also announced a $250M ATM equity issuance program. While the stock reaction was not detailed, the company's high EV/2024 EBITDA suggests market optimism for future performance.
The ATM program allows for incremental share sales, which may mitigate immediate stock pressure. The high EV/2024 EBITDA indicates market optimism, but the stock reaction was not specified.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 100