This Is the Perfect Time to Buy Canopy Growth Corp. (TSX:WEED)

Canopy Growth Corp. (TSX:WEED)(NYSE:CGC) continues to offer investors great long-term growth opportunities, despite a recent pullback in the stock price.

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Over the past few years, Canopy Growth (TSX:WEED)(NYSE:CGC) has lit a fire under the emerging and potentially lucrative market that legalization is going to introduce within a few short weeks.

Canopy has already played its hand by using its and clout to score a number of important partnerships and deals over the past two years, and those deals are finally set to bear fruit.

Just to put Canopy’s incredible growth into perspective, keep in mind that the company operates in over 10 countries on five continents, and Canopy has over 2.4 million square feet of production and has forged several agreements with prominent partners both in Canada and around the world.

That’s just the tip of the iceberg.

There are plenty of other reasons why investors looking to enter this new segment of the market should strongly consider an investment in Canopy.

It’s a massive market

The first point I want to bring up is a recent quote by Canopy CEO Bruce Linton: “We’re going to make anything and everything that’s lawful.”

That quote reveals just a sliver of the potential that this new segment of the market poses, and as the largest cannabis stock on the market, Canopy is in a position to capitalize on that yet-unknown market. Last year we saw how an infusion of capital by Constellation Brands into Canopy set the stage for the development of a whole line of Cannabis-infused beverages. Last month, we saw a similar deal for cannabis-infused non-alcoholic beverages materialize between Hydropothecary and Molson Coors.

To put it another way, there will be far more products to emerge from legalization than just the smoking type, and Canopy will benefit from its market position.

Canopy has made some incredible acquisitions

While the Constellation deal was impressive, there are several other deals that Canopy has completed over the past two years that have opened doors to further expansion. The acquisition of German-based pharmaceutical distributor MedCann was significant, as German laws at the time prohibited the growing of medicinal marijuana, so the supply for that country needs to be imported from a reputable foreign supplier, such as Canopy. With Canopy acquiring one of the leading importers to the German market, the potential for growth is massive.

Then there was the acquisition of Mettrum Health in 2017, and the 33% share of BC Tweed occurred earlier this summer. The company also purchased Tokyo-based Smoke owner Hiku Brands for $269 million last month, and just this week Canopy announced the completion of Spectrum Cannabis Chile, which will see the company enter the lucrative Latin American market.

Apart from those impressive acquisitions, Canopy has used its clout to garner supply agreements with over half of the provinces too. This sole factor is reason enough for some investors to consider an investment.

Why you should buy Canopy NOW

Legalization has brought forth an incredible opportunity for investors that has been described as similar to “investing in liquor companies at the end of prohibition,” and Canopy, as the largest and most diversified of the companies, poses a massive opportunity over the long term — there’s no denying that.

However, there’s one last point to consider: Ontario’s new government announced yesterday that contrary to what the former Liberal government outlined, there will be an opportunity for a private, yet regulated market to thrive in the province. At time of writing, Canopy is down over 6%, which makes it an intriguing opportunity for investors looking at the long term.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

Fool contributor Demetris Afxentiou has no position in any stocks mentioned. The Motley Fool owns shares of Molson Coors Brewing. 

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