Value
9.3/10data confidence 20%| Component | Sub-score |
|---|---|
| P/S | 9.3 |
- ▸Attractively valued
CGC · Why this verdict
Why Canopy Growth (CGC) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.2/10
ConfidenceMEDIUM
MacroNEUTRAL
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
Canopy Growth screens as attractively valued on a price-to-sales basis, per the value assessment. Valuation breakdown | The value score should stay elevated and the discount should narrow via price stabilization or appreciation over the next 12 months. | →Stable |
| CounterThe cheap price-to-sales multiple likely reflects real business quality problems — the data flags no competitive moat and broader quality concerns — rather than a straightforward mispricing. | ||
Canopy Growth's quality score of 2.5 sits below the engine's 4.0 floor, driven by a lack of competitive moat and broader quality concerns. Quality breakdown | The quality score should climb back above the 4.0 floor over the next 12 months for the stock to clear the minimum quality bar. | →Stable |
| CounterA recent volume surge of about 2.5 times average on an upward move suggests renewed buying interest that could precede fundamental improvement. | ||
Canopy Growth is in a confirmed downtrend, trading below its 200-day moving average with that average declining about 4.7% per month, and shares sit roughly 58% below their 52-week high. Momentum breakdown | For the recovery setup to hold, price should reclaim the 200-day moving average and the moving-average slope should turn positive over the next 12 months. | →Stable |
| CounterThe engine's own read already flags early recovery characteristics, including improving MACD, even within the technical downtrend. | ||
Canopy Growth has missed earnings estimates badly across its recent reported quarters, including surprises of -670% and -183%, with zero beats, while insiders have also sold a net of roughly 203,500 shares. Earnings | Results should move back toward in-line, with the EPS surprise recovering to 0% or better in the next reported quarter. | →Stable |
| CounterDespite the poor earnings track record and insider selling, analysts still assign positive implied upside of about 22% to the shares. | ||
Canopy Growth screens as attractively valued on a price-to-sales basis, per the value assessment.
→StableValuation breakdown
- Expectation
- The value score should stay elevated and the discount should narrow via price stabilization or appreciation over the next 12 months.
CounterThe cheap price-to-sales multiple likely reflects real business quality problems — the data flags no competitive moat and broader quality concerns — rather than a straightforward mispricing.
Canopy Growth's quality score of 2.5 sits below the engine's 4.0 floor, driven by a lack of competitive moat and broader quality concerns.
→StableQuality breakdown
- Expectation
- The quality score should climb back above the 4.0 floor over the next 12 months for the stock to clear the minimum quality bar.
CounterA recent volume surge of about 2.5 times average on an upward move suggests renewed buying interest that could precede fundamental improvement.
Canopy Growth is in a confirmed downtrend, trading below its 200-day moving average with that average declining about 4.7% per month, and shares sit roughly 58% below their 52-week high.
→StableMomentum breakdown
- Expectation
- For the recovery setup to hold, price should reclaim the 200-day moving average and the moving-average slope should turn positive over the next 12 months.
CounterThe engine's own read already flags early recovery characteristics, including improving MACD, even within the technical downtrend.
Canopy Growth has missed earnings estimates badly across its recent reported quarters, including surprises of -670% and -183%, with zero beats, while insiders have also sold a net of roughly 203,500 shares.
→StableEarnings
- Expectation
- Results should move back toward in-line, with the EPS surprise recovering to 0% or better in the next reported quarter.
CounterDespite the poor earnings track record and insider selling, analysts still assign positive implied upside of about 22% to the shares.
TrendMatrix Research · core thesis
Engine thesis — one sentence
Canopy Growth screens cheap on a price-to-sales basis but carries a quality score well below the engine's floor, a confirmed technical downtrend after a roughly 58% drawdown, and a string of severe earnings misses accompanied by bearish insider selling, so any recovery case rests on early technical signs of stabilization rather than confirmed fundamentals.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Per-dimension breakdown
Quality
2.5/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 0.0 |
| ROA | 0.0 |
| Gross margin | 1.6 |
| Op margin | 0.0 |
| Net margin | 0.0 |
| Current ratio | 9.7 |
| Moat | 4.4 |
| Piotroski F | 4.4 |
- ▸No competitive moat
- ▸Quality concerns
Growth
4.9/10data confidence 33%| Component | Sub-score |
|---|---|
| Rev growth | 4.9 |
Momentum
4.3/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 4.5 |
| MACD | 6.1 |
| OBV | 10.0 |
| MA position | 1.0 |
| Volume | 0.0 |
- ▸Volume accumulation (rising OBV)
- ▸Below 200-MA, MA slope -5.2%/30d — confirmed downtrend
Sentiment
6.3/10data confidence 100%| Component | Sub-score |
|---|---|
| Analyst rating | 5.0 |
| Price target | 8.3 |
| erm sentiment | 5.9 |
- ▸Analyst upside: 27%
Insider
5.5/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 4.5 |
| insider conviction | 2.0 |
| holder change | 10.0 |
- ▸Modest insider selling — $198,239 (0.046% of mkt cap)
- ▸Institutions accumulating
Peer rank
5.1/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 7.0 |
| quality rank | 0.4 |
| growth rank | 6.0 |
Technical
4.0/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 5.2 |
| support resistance | 6.9 |
| 52w position | 0.0 |
Risk (lower is worse)
4.0/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 7.2 |
| days to cover | 7.8 |
| volatility | 0.0 |
| put call | 0.0 |
| implied vol | 0.0 |
| max pain risk | 7.0 |
| beta | 2.0 |
| debt equity | 8.4 |
- ▸Elevated put/call: 14.00
- ▸High IV: 83%
Catalyst
3.2/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 8.0 |
| earnings history | 0.0 |
| earnings timing | 5.0 |
| surprise avg | 0.0 |
- ▸Earnings concerns: 0B/3M
How the verdict was assembled
Engine trigger
Quality below minimum threshold.
Engine technical detail
verdict_path:
L1:HARD_BLOCKPassed (5)
- INSIDER:OK
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:30d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (4)
- MOMENTUM:4.3<4.5
- ASYMMETRY:0.8<1.5@spot
- DEATH_CROSS:HARD_BLOCK
- 8K_CRITICAL:4.02
Warning (0)
none
Reward-to-Risk
0.75
Upside
+7.6%
Downside
10.1%
Sizing output
AVOID
SetupRecovery — Death cross but MACD improving, RSI 51
EdgeInst Constrain — Small cap ($0.4B) below institutional reach
SuitabilitySpeculative — Drawdown -59% (>40% off 52w high)
Investment implication
The L1 gate blocked the positive-verdict path: a hard-floor threshold was breached, so dimensional pillars — including Value at 9.3 could not lift the engine output above the verdict floor. Failed gate signal: MOMENTUM:4.3<4.5.
The strongest dimensions are Value at 9.3, Sentiment at 6.3, and Insider at 5.5; the weakest are Quality at 2.5, Catalyst at 3.2, and Risk (lower is worse) at 4.0. The V9 engine flagged 4 failed gates, producing an asymmetric reward-to-risk of 0.75 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Cheap Price To Sales
Trip ifShares decline more than 25% without any re-rating in the multiple, confirming continued de-rating instead of value realization.
- P2Quality Below Floor
Trip ifQuality score rises above 4.0, clearing the engine's minimum floor from the current 2.5 reading.
- P3Confirmed Downtrend Deep Drawdown
Trip ifPrice closes back above the 200-day moving average and the moving-average slope turns positive for 2 consecutive months.
- P4Earnings Miss Streak Bearish Insider
Trip ifEPS surprise rises above 0% at the next reported quarter, ending the current miss streak.