Canopy Growth Corp (TSE:WEED) NY Hemp License The Gift That Keeps on Giving

Canopy Growth Corp (TSE:WEED) (NYSE:CGC) (FRA:11L1) received another early lift from U.S. investment bank Piper Jaffray this morning, which propelled an early cannabis complex rally. While the news was sparked upside momentum in the sector’s undisputed king, price action in the remaining cannabis complex is rather benign.

The catalyzing event comes courtesy of Piper Jaffray analyst Michael Lavery, who raised his price target for Canopy Growth to USD$60 from $40—yet oddly keeps an “Overweight” rating on CGC stock despite a 50% ramp-up in expectations. He elucidated in the research note that he considers Canopy’s recent approval of a New York hemp license to be a “tangible first step forward” in the U.S. that points to the beginning of a “long” U.S. growth trajectory. After adding over $1 billion dollars of market capitalization on January 14th after receiving their New York State hemp licence, that event remains a primary catalyst in CGC’s extended upside momentum.

This is especially true considering Piper’s upgrade wasn’t completely bullish. The investment bank is now expecting Canopy to sell 10,000 kg of cannabis in their fiscal third quarter—down from previous expectations of 14,000 kg. Despite tempered near-term sales projections, big picture sentiment is dominating the tape today. At publishing time, Canopy Growth has added another $1.5B worth of market cap.

Today’s upgrade is the second time this month Piper Jaffray has exerted a monumental effect in CGC stock. On January 9th, Canopy Growth surged 13% after initiating coverage with an “Overweight” rating and $40/share price target. This was enough to jailbreak CGC shares—and the rest of the cannabis sector—out of the nasty bear impulse brought forth by prolonged post-legalization selling. This, despite providing a total addressable market range (Canada adult-use/EU medical/U.S. CBD-infuses products) of between $15-50 billion; essentially, a completely useless forecast based on variable turnout beyond the firm’s knowledge.

In reaction to today’s event, the rest of the Canadian cannabis complex has remained somewhat subdued. At publishing time, the benchmark Horizons Marijuana Life Sciences Index ETF was ↑2.04%, breaking through the simple 200-Day moving average which has throttled Canadian MJ for the better part of 2 weeks.

Whether the tepid breakthrough can provide the building blocks for something more remains to be seen. On this day however, Canopy Growth’s move is based on advantages derived from being the sector’s undisputed leader.

Original article: Canopy Growth Corp (TSE:WEED) NY Hemp License The Gift That Keeps on Giving

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