Last Friday the Chief Financial Officer of HEXO Michael Monahan has resigned for family cause. This decision took everyone by surprise and many speculated on the real reasons that led to his resignation.
Although HEXO continues to claim that everything is under control and that this decision is not related to the financial statements that will come out around October 24, some analysts have been tough on HEXO by lowering their target price including Bank of America and BMO.
One reason is that they expect sales to fall by 20% every quarter, which will reduce HEXO’s projection of sales to $ 400 million for fiscal year 2020.
However, according to Cannada statistics, cannabis sales have been steadily increasing since legalization. Sales even exceeded $100 million (104) for the first time in July with over 14% increase over the previous month. The pace is not expected to decrease with the rapid growth of stores across the country and the beginning of the second phase of legalization with the edible in exactly 10 days.
Today’s increase in HEXO target prices
For their part, analyst John Chu of Desjardins and Roth Capital keeps and even increases their target price on HEXO
Mr. Chu of Desjardins said his target price of $14 for the Hexo stock remained unchanged.
Roth Capital on their side increases their target price to $13.31 and maintain their buy recommendation.
MKM Partners analyst Bill Kirk reiterated a Buy rating with a $12 price targe
HEXO still has the best chance of creating a defensible brand
the MKM analyst Kirk said in a Monday note
We are a few days away from Phase 2 of the long awaited legalization of cannabis for both consumers and investors.
The joint venture between Molson and Hexo promises breakthrough products and relies heavily on TRUSS to lead the cannabis and CBD-based beverage market in North America, which represents a billion-dollar market.
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This article is written and published by The Cannabis Stock
Disclaimer : The Cannabis Stock wants to promote the cannabis market with the best publication on the market. The Cannabis Stock does not recommend selling or buying any of the company mentioned and is not responsible for any losses that may result.