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For marijuana stocks, this week was mainly about quarterly results. That's because two of the biggest players in the sector, Canopy Growth (NYSE: CGC) and Tilray (NASDAQ: TLRY), unveiled their earnings.
Those numbers were the latest from these companies. However, they weren't exactly the greatest. Outside of that, there was some news with Aurora Cannabis' (NYSE: ACB) funding.
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Canopy Growth's Q1 misses by miles
This week's Most Disappointing Marijuana Stock prize has to go to Canopy Growth. The company fell well short of analyst estimates. Heck, let's be honest -- it didn't even come close.
As for the headline numbers, net revenue for the quarter came in at 90.5 million Canadian dollars. That was over three times the Q1 2019 result -- but remember that recreational marijuana in Canada only became legal toward the end of last year. Therefore, sales of it have increased from nothing to millions of dollars for big companies in the business.
Regardless, that CA$90.5 million was quite some distance from the CA$109 million forecast by analysts.
In terms of production, the company harvested 40,960 kilos during the quarter, up from 9,685 kilos in Q1 of 2019. Meanwhile, the bottom line sank sharply. Canopy Growth's net loss was nearly CA$1.3 million (CA$3.70 per share), from a year-ago shortfall of only around CA$91,000 (CA$0.40 per share). Again, this is far worse than what was expected by the prognosticators, who collectively were modeling a net loss of CA$0.38 per share.
As any stock investor well knows, companies miss their estimates every now and then. But on both the top and bottom lines, Canopy Growth's Q1 was an embarrassing whiff. One big culprit was a notable slide in quarter-on-quarter sales, which was due in no small part to a very sharp drop in cannabis oil and softgel sales -- so sharp, they came perilously close to zero. This has disturbing implications as to how the company is being run.
Canopy Growth's stock was hardly a winner this week. Its price declined nearly 15% from Monday to Friday's close.
Tilray has a mixed Q2
Tilray's freshly reported quarter was better than Canopy Growth's -- but that isn't exactly a ringing endorsement of its performance.
For its Q2 of fiscal 2019, Tilray saw the more-or-less expected pop in revenue, which rose over four times on a year-over-year basis, to $45.9 million. In terms of kilogram-equivalents sold, the tally was 5,588 kilos against Q1 of fiscal 2018's 1,514 kilos. The average analyst estimate for revenue was $41.1 million.