Back in February, Pariksh initiated coverage on HEXO with a bullish buy rating and a $7.00 USD per share price target, but things have changed significantly since then. Just over a week ago, CIBC analyst Robert Catellier downgraded his rating on shares of HEXO Corp. from Outperform to Neutral.
According to MarketWatch, “Oppenheimer downgraded to stock to perform from outperform and said it sees greater gross margin pressure than expected when it first initiated coverage of the stock in February.”
“With our updated forecasts and incorporating Newstrike, we now view shares as more fairly valued,” analyst Rupesh Pariksh commented in his analyst update. “Although we are stepping to the sidelines, we still see many positives to the HEXO story longer term and believe the name should remain on the radar for investors,” said Pariksh.
According to TheFly, “Oppenheimer analyst Rupesh Parikh downgraded HEXO Corp to Perform from Outperform as he now sees a more balanced outlook for the shares primarily driven by greater gross margin pressures than he initially envisioned, which is impacted by the potential for pricing pressures going forward and delays on the advanced products front. With his updated forecasts and incorporating Newstrike, the analyst now views shares as more fairly valued.”
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