A strategic acquisition, new CBD product launches, and higher demand for adult-use cannabis products have helped HEXO Corp. (NYSE:HEXO) deliver decent returns over the past year. However, given the heated competition in the domestic and international cannabis markets, and the company’s not-so-promising financial performance, will the stock be able to sustain its momentum, or will it pull back? Read ahead to learn more.Headquartered in Kanata, Canada, HEXO Corp. (HEXO) sells adult-use and medical cannabis products and cannabis beverages in Canada. The stock has gained 124.3% over the past year, due primarily to the rapid expansion of the cannabidiol (CBD) market. However, HEXO has lost 3.6% over the past month.
In fact, HEXO’s stock is currently trading 43.9% below its 52-week high of $11.04, indicating short-term bearishness. The company’s latest earnings results, which reported an almost $21million net loss and a significant operational loss, have contributed to this downtrend.
Furthermore, as HEXO’s rivals continue to grow their sales significantly, the heated battle for market share could threaten the company’s growth prospects. Thus, we expect the stock to retreat in the near term.