Shares of Canadian cannabis company Canopy Growth (NASDAQ: CGC) leaped nearly 11% higher (10.8% to be precise) through 10:30 a.m. ET on Tuesday after the company released the voting results from its annual general and special meeting of shareholders.
Two weeks ago, if you recall, Canopy management had urged investors to vote in favor of several proposals laid out at that meeting, including:
Electing seven named directors to its board of directors.
Appointing its auditors for the year.
Adopting a new equity incentive plan.
Amending its bylaws to consolidate the company’s shares.
Setting compensation for its officers.
Converting some convertible debt to shares of the company.
So what happened? Well, basically, management got everything it asked for. All six of these “matters put forward before the Company’s shareholders” were approved.
This was hardly surprising, though. Managements generally get everything they ask for in these kinds of annual general meeting votes. For that matter, the subjects up for consideration were mostly routine. The most controversial item on the list — the last question considered — might even be considered a negative by investors less than thrilled with the prospect of more shares coming on the market to dilute their ownership stakes and their shares of any future profits.
So why the outsize positive reaction to Canopy Growth’s news today? Most likely, this is investors demonstrating confidence in management and the way it’s running the company.
That’s not necessarily a bad decision. With marijuana legalization finally seeming to be making some progress in Washington, D.C. — with movement by regulators to relax the scheduling regulations on cannabis, and movement in Congress to permit banks to offer banking services to cannabis companies — things do seem to be progressing quite nicely for Canopy Growth’s prospects. And the stock is up nearly triple over the past month.
Perhaps what investors are really telling us with these voting results is that with all the smooth sailing Canopy Growth has enjoyed lately, they simply don’t want to rock the boat.
10 stocks we like better than Canopy Growth
When our analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now… and Canopy Growth wasn’t one of them! That’s right — they think these 10 stocks are even better buys.
*Stock Advisor returns as of September 25, 2023
Rich Smith has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
—
Blog powered by G6
Disclaimer! A guest author has made this post. G6 has not checked the post. its content and attachments and under no circumstances will G6 be held responsible or liable in any way for any claims, damages, losses, expenses, costs or liabilities whatsoever (including, without limitation, any direct or indirect damages for loss of profits, business interruption or loss of information) resulting or arising directly or indirectly from your use of or inability to use this website or any websites linked to it, or from your reliance on the information and material on this website, even if the G6 has been advised of the possibility of such damages in advance.
For any inquiries, please contact [email protected]
