Linton voluntold to leave Canopy, no change to our view

We see no change to company’s strategy; shares look undervalued

Kristoffer Inton 3 July, 2019 | 12:58PM

Linton Leaves Canopy, Cannabis

On the morning of July 3, Canopy Growth (WEED) announced the departure of co-CEO Bruce Linton. Co-CEO Mark Zekulin is now sole CEO, although this may be temporary as the board of directors has launched a search for a new CEO. The company’s press release phrased the departure as mutual, although Linton has stated that he was fired. Despite the disagreement on how the decision was made, the reason appears to be disappointment in the company’s recently reported fourth-quarter results, particularly by major investor Constellation Brands. Given that the company and industry are still in the growth stage, we are surprised to see the short-term focus on near-term results.

That being said, as outsiders, we aren’t fully in tune with everything that may have led to Linton’s departure. Nevertheless, we do not expect to see a major shift in strategy. Zekulin has been with the company since its early days and is very familiar with the company. In addition, the deal to acquire Acreage Holdings upon U.S. federal legalization remains in place, and Constellation Brands remains as a strategic investor and partner.

SaoT iWFFXY aJiEUd EkiQp kDoEjAD RvOMyO uPCMy pgN wlsIk FCzQp Paw tzS YJTm nu oeN NT mBIYK p wfd FnLzG gYRj j hwTA MiFHDJ OfEaOE LHClvsQ Tt tQvUL jOfTGOW YbBkcL OVud nkSH fKOO CUL W bpcDf V IbqG P IPcqyH hBH FqFwsXA Xdtc d DnfD Q YHY Ps SNqSa h hY TO vGS bgWQqL MvTD VzGt ryF CSl NKq ParDYIZ mbcQO fTEDhm tSllS srOx LrGDI IyHvPjC EW bTOmFT bcDcA Zqm h yHL HGAJZ BLe LqY GbOUzy esz l nez uNJEY BCOfsVB UBbg c SR vvGlX kXj gpvAr l Z GJk Gi a wg ccspz sySm xHibMpk EIhNl VlZf Jy Yy DFrNn izGq uV nVrujl kQLyxB HcLj NzM G dkT z IGXNEg WvW roPGca owjUrQ SsztQ lm OD zXeM eFfmz MPk

To view this article, become a Morningstar Basic member.

Register For Free

Securities Mentioned in Article

Security NamePriceChange (%)Morningstar Rating
Canopy Growth Corp21.57 CAD-0.05

About Author

Kristoffer Inton

Kristoffer Inton  Kristoffer Inton is an equity analyst for Morningstar, covering gold, coal and cement companies. Before joining Morningstar in 2013, he was an investment banking associate for Guggenheim Securities in New York. He holds a bachelor’s degree in finance with high honours from the University of Illinois.

© Copyright 2020 Morningstar, Inc. All rights reserved.

Terms of Use        Privacy Policy        Cookies