Canopy Growth CFO Judy Hong sells shares for tax obligations By Investing.com

Canopy Growth Corp’s (NYSE:NASDAQ:) Chief Financial Officer, Judy Hong, has recently engaged in transactions involving the company’s shares, according to the latest SEC filing. On June 10, 2024, Hong sold 45 common shares at a price of $9.94 CAD, totaling approximately $447 CAD. This sale was related to the vesting of Restricted Stock Units (RSUs) and the associated tax obligations, as detailed in the footnotes of the report.

In addition to the sale, Hong also acquired a significant number of shares through the conversion of performance stock units to RSUs, which are set to vest on June 14, 2025. The conversion resulted in Hong obtaining 2,774 shares, with the achievement of certain performance metrics as determined by Canopy Growth’s board of directors.

Furthermore, Hong was granted 82,016 RSUs that will vest in three equal installments over the next three years, starting from June 15, 2025. These transactions reflect the company’s ongoing compensation and incentive plans for its executives.

Alongside the non-derivative securities transactions, Hong was also involved in derivative transactions, specifically the acquisition of stock options. These options, numbering 99,776, have a conversion or exercise price of $7.59 CAD and are set to vest annually over the next three years from the grant date. The options have an expiration date of June 10, 2030.

Investors and followers of Canopy Growth Corp can view these transactions as part of the normal course of stock-based compensation for company executives. The sale of shares by Hong appears to be primarily for the purpose of fulfilling tax obligations related to the vesting of RSUs, a common practice among corporate executives.

In other recent news, Canopy Growth Corporation has finalized its acquisition of Jetty and two Wana Brands business units, as part of its broader expansion strategy. This move comes in conjunction with the company’s decision to acquire a significant portion of Acreage Holdings (OTC:), Inc.’s debt, further strengthening its operational platform. These developments align with Canopy Growth’s efforts to bolster its presence in the cannabis market.

The company also reported a 16% year-over-year increase in consolidated net revenue, reaching $73 million in Q4 FY24, and reduced its debt by over $700 million. Despite EBITDA falling short of estimates, the company’s management remains optimistic about achieving positive adjusted EBITDA in the second half of fiscal year 2025.

Piper Sandler maintained an Underweight rating on Canopy Growth, adjusting future sales forecasts downward, while Roth/MKM reduced its price target but maintained a Buy rating. Both firms anticipate potential benefits for Canopy Growth from the federal rescheduling of cannabis. These recent developments reflect the company’s strategic moves and financial trajectory in the cannabis market.

InvestingPro Insights

Canopy Growth Corp (NYSE:CGC) has been under the investor’s microscope, and the recent activities of its CFO, Judy Hong, have added another layer to the narrative. In light of these developments, a glance at CGC’s financial health and stock performance through InvestingPro metrics offers additional context. The company’s market capitalization stands at a modest $578.97M, reflecting its position in the market. Despite the challenges, CGC has shown a strong return over the last three months, with a price total return of 156.42%, signaling a significant investor confidence rebound.

The InvestingPro Tips highlight that CGC’s stock has been characterized by high price volatility, which could be a double-edged sword for investors seeking both growth opportunities and stability. Moreover, analysts do not anticipate the company will be profitable this year, aligning with the reported negative P/E ratio of -1.18 for the last twelve months as of Q4 2024. This suggests that while the stock may offer short-term gains, the long-term profitability outlook remains uncertain.

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