OPINION: Canopy’s Shakeup Is A Sign Of Strength, Not Weakness

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Bruce Linton would be the first to admit he’s not the type of guy to scale a 14 billion dollar company to a global powerhouse. He stated in an interview yesterday that he was terminated by Canopy (CGC), but, that he accepts the termination as the company is moving into a new phase of development, one he has never seen before.

Usually when CEO’s give the departure speech they don’t explicitly say they were terminated, instead it’s some bullshit PR where they are leaving to spend time with their family. When Vic Neufeld exited Aphria, and Sean Dollinger exited Namaste there was a very different feel.

Bruce, on the other hand flat out said he was terminated, and that he has no hard feelings about what happened as his role has kind of come to a close. And I believe him.

Linton took the company from a retrofitted chocolate factory in a small town in Ontario to a global powerhouse in under 5 years, for that he will go down as one of the most accomplished CEO’s in the space. He is also probably the most recognizable person in the sector, with his dressed down faded black jeans and Canopy t-shirts. Bruce had a blue collar vibe, and often joked about those who wore suits and drove Lambos.

Counterpoint

Not everyone is on board with Linton’s exit being kum ba yah, as one Redditor pointed out:

Card

Constellation (STZ) also came out publicly last week stating they were not happy with Canopy’s earnings for Q4, which undoubtedly falls on the CEO.

It’s also now being reported that Canopy’s interim CEO will likely step down soon to make room for someone more experienced. His replacement will most likely be a big swinging dick from Wall Street that the company will bring in to really scale this thing up to the global player it could be. Canopy investors are far from panicking as the stock continues to climb.

Canopy’s current position:

Fully Diluted Share Count – 542 Million (Includes Options, Warrants, Converts)

Current Cash and Marketable Securities as of 3/31/2019 – C$4.51

Constellation Warrants at C$50.4 – 88.5 Million – C$4.46 Billion

Constellation Warrants at C$76.68 – 38.5 Million – C$2.95 Billion

Stock Options (Average Weighted Price for Options C$34.10) – C$1.12

Converts – Unsure amount

Total Cash from Cash/Marketable Securities as of 3/31/2019; Warrants; Options – C$13.04 Billion

Price Today July 3, 2019 at 12:26 PM – C$53.53

Market Cap (Fully Diluted) – C$29.01 Billion

Fully Diluted Cash to Fully Diluted Market Cap Ratio – 44.95%

Add in Other Important Tangible Assets:

Inventory as of 3/31/2019 – C$0.26 Billion

Amounts Receivable and Prepaid Expenses and other Current Assets – C$0.21 Billion

Property, Plant and Equipment – C$1.09 Billion

Fully Diluted Cash and Other Selected Tangible Assets Total – C$14.6 Billion

Fully Diluted Cash and Other Selected Tangible Assets to Fully Diluted Market Cap Ratio – 50.32%

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