Canopy Growth rally continues with 28% gain after recent talk about federal cannabis reforms

By Steve Gelsi

Stock has been rising sharply since March 14 and has gained 140% in the past week

Canopy Growth Corp.'s stock continued its rally on Wednesday with a fresh rise of 28% on heavier-than-usual volume.

The stock (CGC) (CA:WEED) has been rising in every trading session since March 14, including a gain of $2.12, to $17.39 a share, in recent action. It's the highest price level the stock has seen since September.

Volume on Wednesday topped 40 million shares, well over the average daily total of about 6 million shares.

Canopy Growth has not issued any material company announcements in recent days.

But its stock has been rising on the heels of comments this month from the Biden administration on potential reclassification of cannabis under federal law to Schedule III from its current designation as a Schedule I controlled substance.

Canopy Growth holds options to buy three U.S. cannabis companies -Acreage, Wanna Brands and Jetty Extracts - to form a business unit called Canopy USA.

Canopy Growth will hold a shareholder vote on April 12 to authorize the issuance of a new class of nonvoting and nonparticipating exchangeable shares as part of its move to create Canopy USA.

Canopy Growth also has a presence in Europe, where Germany recently decriminalized cannabis.

Also read: Canopy Growth's stock doubles to record weekly gain after Germany votes to legalize pot

Canopy Growth and other marijuana stocks have been in rally mode for much of the month of March, after President Joe Biden mentioned the rescheduling of cannabis in his State of the Union speech on March 7.

Also read: Cannabis stocks extend gains after Biden White House shows support for marijuana reforms

That was followed up by comments on March 15 by Vice President Kamala Harris, who called the current Schedule I classification for cannabis "absurd" and said that it should be rescheduled "as soon as possible."

Also read: Canadian cannabis giant Canopy Growth seeks shareholder approval to speed up entry into U.S. market

-Steve Gelsi

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03-27-24 1516ET

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