Bernstein starts Canopy Growth at Underperform, sees equity raise

Bernstein analyst Nadine Sarwat initiated coverage of Canopy Growth with an Underperform rating and $1.50 price target. Canopy’s Canadian cannabis portfolio has been “meaningfully hit” by price compression, market share loss and transitory headwinds from shifting the portfolio to premium flower, Sarwat tells investors in a research note. The analyst does not forecast the company reaching positive adjusted EBITDA until fiscal 2026 and sees “meaningful downside to the name.” She thinks Canopy Growth will need to issue additional equity in the near future.