constellation brands cgc

constellation brands cgc插图

CGC is Constellation BrandsConstellation BrandsConstellation Brands, Inc., a Fortune 500 company, is an international producer and marketer of beer, wine and spirits. Constellation is the largest beer import company in the US, measured by sales, and has the third-largest market share of all major beer’ shortcut intocannabis. According to The Motley Fool, a financial news publication focused on stocks and investments, Constellation Brands owns 38.6% of CGC’s market shares. That’s a $4 billion stake in the company.

Is constellation’s partnership with Canopy Growth a green rush in cannabis?

The same strength can’t be said of its partnership with Canopy Growth ( CGC -6.57%), the Canadian cannabis company Constellation invested $4 billion into in 2017 in what became a green rush among giant corporations to stake claims in the budding pot market.

What are Constellation Brands’ partnerships up to?

Speaking of partnerships, Constellation Brands also announced it was entering into one with Coca-Cola ( KO -0.46%) to produce ready-to-drink (RTD) beverages under the soda maker’s Fresca brand. Industry site IWSR expects RTD volume to double in size by 2025, growing at a 15% annual rate between 2020 and 2025 in 10 global markets.

Why is Constellation Brands investing in Canopy Growth Stock?

Constellation’s massive presence in the consumer goods industry will also help Canopy in better understanding customer trends and ensure better brand positioning. For Constellation, on the other hand, such an investment enables them to solidify their presence in an industry that is poised to boom.

Is Constellation Brands the most expensive stock to buy?

At 83 times trailing earnings, 20 times next year’s estimates, and 33 times the free cash flow it produces (Constellation expects to generate between $1.4 billion and $1.5 billion this year), the alcoholic beverage producer seems an expensive stock to swallow. Rich Duprey owns Coca-Cola. The Motley Fool owns and recommends Constellation Brands.

What was the CGC on November 21?

Previously, CGC had jumped up by 15.02% to $20.29 on November 21. The cannabis sector saw a short rally after House Judiciary Committee favored the MORE (Marijuana Opportunity Reinvestment and Expungement Act) bill. This is the first step in decriminalizing marijuana at the federal level in the US.

What is CGC liquid?

This liquid is the active ingredient for THC- and CBD-based beverages. On November 22, the company got an operating and storage license for its 150,000-square-foot beverage facility at Smiths Falls.

Is STZ losing hope?

STZ seems to be losing hope about CGC. On November 22, as reported in a regulatory filing, Constellation Brands announced that it will not be making any additional cash investments in CGC.

Who owns CGC?

In October 2017, Constellation Brands (STZ) bought a 9.9% stake in CGC for $245 million Canadian dollars. In November 2018, STZ upped its stake in CGC to 38% for an investment of $5 billion Canadian dollars.

How many tranches of warrants are there?

However, there is a problem with the warrants. The original announcement filed with the U.S. Securities and Exchange Commission indicates that there are two tranches of the warrants. The Tranche A warrants, comprising 88.5 million rights to buy shares, have an exercise price of 50.40 CAD per share.

How much cash does canopy grow?

For example, as of Dec. 31, 2019, Canopy Growth had 1.6 billion CAD in cash and 706 million CAD in marketable securities. This totals 2.3 billion CAD. Moreover, this represents just 29% of its market value.

When does the Constellation warrant expire?

One good thing for Canopy is that there is a time limit. Constellation Brands has until Nov. 1, 2021. That is when the warrants expire. If CGC stock will be higher before then, Constellation Brands may have to exercise those warrants within the next six-to-nine months.

Is Canopy a public company?

Canopy just launched its new cannabis-infused beverage line. This may help create extra demand for its products. But, don’t hold your breath. So far none of the cannabis companies that are public, especially the higher-priced stocks like Canopy, have figured out how to run their operations profitably.

What is canopy growth?

Canopy Growth (TSX:WEED, NYSE:CGC) is a world-leading diversified cannabis, hemp and cannabis device company, offering distinct brands and curat ed cannabis varieties in dried, oil and Softgel capsule forms , as well as medical devices through Canopy Growth’s subsidiary, Storz & Bickel GMbH & Co. KG. From product and process innovation to market execution, Canopy Growth is driven by a passion for leadership and a commitment to building a world-class cannabis company one product, site and country at a time. Canopy Growth has operations in over a dozen countries across five continents.

What is Constellation Brands?

At Constellation Brands (NYSE: STZ and STZ.B), our mission is to build brands that people love because we believe sharing a toast, unwinding after a day, celebrating milestones, and helping people connect, are Worth Reaching For. It’s worth our dedication, hard work, and the bold calculated risks we take to deliver more for our consumers, trade partners, shareholders, and communities in which we live and work. It’s what has made us one of the fastest-growing large CPG companies in the U.S. at retail, and it drives our pursuit to deliver what’s next.

What is Spectrum Therapeutics?

Canopy Growth’s medical division, Spectrum Therapeutics is proudly dedicated to educating healthcare practitioners, conducting robust clinical research, and furthering the public’s understanding of cannabis, and has devoted millions of dollars toward cutting edge, commercializable research and IP development. Spectrum Therapeutics sells a range of full-spectrum products using its colour-coded classification Spectrum system as well as single cannabinoid Dronabinol under the brand Bionorica Ethics.

Is there a forward-looking statement about Canopy Growth?

This news release contains forward-looking statements. All statements other than statements of historical fact are forward-looking statements, including statements about Constellation Brands’ future ownership of shares of Canopy Growth, the possibility that Canopy Growth might exercise its right to acquire Acreage Holdings, Inc. and Canopy Growth’s ability to continue its pursuit of market opportunities and success. The words “if”,“expect,” “intend” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words. These statements may relate to business strategy, future operations, prospects, plans and objectives of management, as well as information concerning expected actions of third parties. All forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those set forth in, or implied by, such forward-looking statements. The forward-looking statements are based on management’s current expectations and should not be construed in any manner as a guarantee that such results will in fact occur or will occur on the timetable contemplated hereby. All forward-looking statements speak only as of the date of this news release and neither Constellation Brands nor Canopy Growth undertakes any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. In addition to risks and uncertainties associated with ordinary business operations, the forward-looking statements contained in this news release are subject to other risks and uncertainties and other factors and uncertainties disclosed from time-to-time in Constellation Brands’ filings with the Securities and Exchange Commission, including its Annual Report on Form 10-K for the fiscal year ended February 29, 2020 and in Canopy Growth’s filings with the Canadian Securities Administration, including in Canopy Growth’s Annual Information Form filed on SEDAR on June 25, 2019 under the heading “Risk Factors”, or with the United States Securities Exchange Commission, which could cause actual future performance to differ from current expectations.

What is the STZ brand?

VICTOR, N.Y. and SMITHS FALLS, Ontario, Aug. 15, 2018 (GLOBE NEWSWIRE) — Constellation Brands (NYSE: STZ and STZ.B), a leading beverage alcohol company, and Canopy Growth Corporation (Canopy Growth) (TSX: WEED, NYSE: CGC), a leading diversified cannabis company (together, the “Companies”), today announced a significant expansion of their strategic partnership to position Canopy Growth as the global leader in cannabis production, branding, intellectual property and retailing.

How much does Constellation own Canopy Growth?

Constellation Brands will increase its ownership interest in Canopy Growth by acquiring 104.5 million shares directly from Canopy Growth, thereby achieving approximately 38 percent ownership when assuming exercise of the existing Constellation warrants. Constellation Brands is acquiring the new shares at a price of C$48.60 per share, which is a 37.9 percent premium to Canopy’s 5-day volume weighted average price of the common shares on the Toronto Stock Exchange (“VWAP”), and a 51.2 percent premium to the closing price on August 14, 2018. Constellation will also receive additional warrants of Canopy that, if exercised, would provide for at least an additional $4.5 billion CAD to Canopy Growth.

What is canopy growth?

Founded in 2013, Canopy Growth has cemented itself as the industry leader in Canada’s legal cannabis market. Through its subsidiaries Tweed and Spectrum Cannabis, Canopy Growth has established a global presence in 11 countries which is driven by product innovation, a robust intellectual property portfolio, and clinical research programs targeting both human and animal health. In Canada, Canopy Growth has established sophisticated operations to support recreational sales by raising capital and making the strategic investments required to maintain and accelerate its market leadership position at a critical time in the company’s evolution. Substantial capital is required to fully capitalize on Canopy Growth’s market-leading position in Canada and establish similar leading positions in markets around the globe.

What is the Constellation brand?

Constellation Brands (NYSE: STZ and STZ.B), a Fortune 500® company, is a leading international producer and marketer of beer, wine and spirits with operations in the U.S., Mexico, New Zealand, Italy and Canada. Constellation is the No. 3 beer company in the U.S. with high-end, iconic imported brands such as Corona Extra, Corona Light, …

How to contact Kingsdale Advisors?

Canopy Growth shareholders should contact Kingsdale Advisors at 1-877-657-5857. Or collect outside North America at 1-416-867-2272, or by email at [email protected]

When is the Canopy Growth transaction closing?

The transaction is subject to customary closing conditions, including Canopy shareholder approval and applicable Canadian government and regulatory approvals, and is expected to close by the end of October 2018. Goldman Sachs advised Constellation Brands and Bank of America Merrill Lynch is providing committed financing for this transaction. Greenhill & Co. Canada Ltd. acted as exclusive financial advisor to Canopy Growth. Kingsdale Advisors is acting as strategic shareholder communications advisor and proxy solicitation agent to Canopy Growth.

Does canopy grow sell cannabis?

Canopy Growth’s future plans include pursuing various product formats in all cannabis channels. Both companies have no plans to sell cannabis products in any market unless it is permissible to do so at all applicable government levels. Canopy Growth remains committed to not entering the U.S. market in any manner that would contravene U.S. federal laws.

Is This Loss Worth it?

Cannabis businesses are extremely volatile, especially when constant overcorrection of the cannabis market risks the valuations of its stocks. Stocks rise and fall quickly, creating risk for industry investors.

What is Constellation Brands?

Constellation Brands, an American beverage company responsible for the production of beverages like Corona and Modelo, has been slowly entering the cannabis space with their acquisition of Canadian cannabis brands.

Why did Acreage lose capital?

They expanded too quickly, eventually losing capital because the rollout was not as lucrative as once expected. Acreage Holdings’ former CEO, Kevin Murphy, commented on the loss, saying that:

How many jobs did CGC cut?

CGC cut around 500 jobs and shut down two cultivation farms, further downsizing in an effort to extend the lifespan of the company.

How much is CGC worth in 2021?

The company sold only wine at first, but soon became iconic for their other liquors. As of April 2021, they have a net worth of $46.2 billion, reports MacroTrend, a finance solutions company. Partnering with CGC would see their business alongside Seth Rogen’s Houseplant, Martha Stewart, and Tweed.

What is Rob Sands’s company?

CEOs Rich and Rob Sands are trying to break into the cannabis market by investing in Canada cannabis company, Canopy Growth (CGC). Alongside their popular beverages, they aim to roll out a CBD and THC-infused beverage called Quatreau throughout the U.S.

Is Constellation Brands investing in CGC?

But Constellation Brands is keeping their investments in CGC since it has an established audience in the cannabis market.

Beer, not pot, is the alcoholic beverage maker’s strength, but the cannabis stock keeps generating losses

Rich has been a Fool since 1998 and writing for the site since 2004. After 20 years of patrolling the mean streets of suburbia, he hung up his badge and gun to take up a pen full time.

Key Points

Constellation Brands’ beer sales continue to show strength, with Corona and Modelo depletions surging.

Beer hasn’t gone flat for Constellation

Constellation Brands said net sales of $2.32 billion were 4.9% lower than last year, but they still eked out a gain over analyst consensus estimates by $40 million.

Cannabis still causing headaches

The same strength can’t be said of its partnership with Canopy Growth ( NASDAQ:CGC), the Canadian cannabis company Constellation invested $4 billion into in 2017 in what became a green rush among giant corporations to stake claims in the budding pot market.

Cashing in on a growing trend

Speaking of partnerships, Constellation Brands also announced it was entering into one with Coca-Cola ( NYSE:KO) to produce ready-to-drink (RTD) beverages under the soda maker’s Fresca brand.

A stock ready to pop?

Still, the RTD space is very crowded, and Constellation is going to be spending between $5 billion and $5.5 billion on upgrading its brewery capacity in Mexico between now and fiscal 2026. That is going to constrain Constellation’s ability to expand earnings, even without the drag of marijuana on its operations.

The marijuana producer has been more anchor than sail for the alcoholic beverages distributor

Constellation Brands ‘ ( STZ -2.06% ) $190 million investment in Canopy Growth ( CGC -3.49% ) in 2017 for a 10% stake in the marijuana producer altered the landscape for the legal weed industry. Because it was the first major company to put money into pot, it bestowed much-needed legitimacy on the industry.

Lurching forward

Canopy Growth’s latest snafu is its delay in introducing its so-called Cannabis 2.0 lineup of marijuana-infused beverages. Instead of the January 2020 launch date it originally promised, Canopy pushed it back to some indefinite time in the future to give it the chance to scale up its production facility.


"In order to deliver products that meet our customer’s high standards we are electing to revise the launch date while we work through the final details," CEO David Klein said in a statement.

Overpromise, underdeliver

If this were Canopy’s only blunder, it would be easy to excuse, but the marijuana producer seems to regularly trip itself up.

A glass half empty

That’s good if cannabis-infused drinks are as big as some hope, but like oils and dried flower and leaf demand, this may be a more underwhelming figure than expected. Although some analysts see them growing to $1.4 billion by 2023, where they are legal to buy in the U.S.

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