Canopy Growth Corporation (NASDAQ: CGC, TSX: WEED) is ending 2025 with something cannabis stocks haven’t seen in a while: sustained, headline-driven volatility — the kind that can lift prices fast, then yank them back down just as quickly.
As of Dec. 24, 2025, CGC was trading around $1.40 in U.S. markets, after closing at $1.40 on Dec. 23 and showing a modest uptick in early premarket indications. [1]
That price tag doesn’t tell the story by itself. December’s story is about policy momentum in Washington, a fresh Canadian acquisition announcement, and a market that’s still trying to decide whether Canopy is a turnaround candidate… or a perennial “next year” trade.
CGC stock action today: a holiday session with big volatility still in the air
Today’s market setup matters because U.S. exchanges are operating a shortened session on Christmas Eve (early close at 1:00 p.m. ET for NYSE markets), which can thin liquidity and exaggerate intraday moves. [2]
Even with the holiday calendar, CGC has been trading like a stock with a megaphone strapped to it:
- On Dec. 23, CGC closed at $1.40, up 6.06%, after trading between $1.26 and $1.45 on volume near 35.9 million shares. [3]
- Just a few sessions earlier, on Dec. 18, the stock swung from an intraday high of $2.38 down to close at $1.69, on extremely heavy volume (over 216 million shares). [4]
If you’re wondering whether options traders think the turbulence is over: not remotely. One widely followed options data feed showed implied volatility around 143% and an “expected move” of roughly 10% over two days. [5]
The big macro catalyst: Trump’s Dec. 18 executive order on medical marijuana and Schedule III
The single largest driver of cannabis-stock sentiment in December has been the White House’s move to push marijuana rescheduling forward.
On Dec. 18, 2025, the White House published an executive order titled “Increasing Medical Marijuana and Cannabidiol Research.” In plain English: the order directs the Attorney General to take steps to complete the rulemaking process that would move marijuana from Schedule I to Schedule III under the Controlled Substances Act. [6]
A few key details in the order and accompanying fact sheet are especially relevant for investors:
- The order explicitly aims to expedite completion of the Schedule III rulemaking process “in accordance with federal law,” referencing the legal procedure under 21 U.S.C. § 811. [7]
- The White House fact sheet frames rescheduling as a way to reduce barriers to research and points to HHS’s prior recommendation supporting Schedule III. [8]
- The executive order also includes policy direction to work with Congress on access to certain full‑spectrum CBD products and directs federal health agencies to develop research methods using real‑world evidence for hemp-derived cannabinoid products. [9]
Important nuance: the President can push — but the rulemaking still has to run its course
A critical reality check (and a reason markets have been choppy): the executive order does not itself reschedule marijuana. Under U.S. law, rescheduling happens through the notice-and-comment rulemaking process, administered by DOJ/DEA with scientific and medical input from HHS. [10]
The Congressional Research Service summarized this neatly: the President cannot directly change marijuana’s scheduling status, but can direct executive agencies to consider and proceed with rescheduling, which is what this order does. [11]
Why Schedule III matters to cannabis companies (and why markets keep re-pricing it)
If the U.S. ultimately moves marijuana to Schedule III, investors are watching for several second-order effects that could reshape industry economics — especially for U.S. operators:
- Taxes: A major investor focus is Internal Revenue Code Section 280E, which limits deductions for businesses trafficking in Schedule I or II substances. Reuters noted that moving cannabis to Schedule III would remove companies from 280E’s reach. [12]
- Capital and banking: Market participants widely interpret rescheduling as a step toward normalizing access to capital. Reuters described potential improvements in funding access and the possibility of broader institutional participation, though significant restrictions could remain without additional legal changes. [13]
- Research: Both the White House materials and major news coverage emphasize that Schedule III would reduce barriers to clinical research and improve the evidence base for medical use. [14]
But it’s not a magic wand. The CRS notes that moving to Schedule III would not automatically bring state-legal markets into compliance with federal law, and significant constraints would remain. [15]
How CGC reacted: a rally, then a reversal — and a reminder that cannabis is still a “retail-driven” trade
The market’s reaction to the executive order was a case study in cannabis-stock reflexes.
Reuters reported that after an initial rise during the session, shares of several cannabis firms fell by the close, with Canopy Growth down nearly 12% at Thursday’s close (Dec. 18). Reuters quoted strategists and analysts pointing to disappointment that the order didn’t include an immediate banking mandate, and to the sector’s tendency to spike on reform headlines and then fade. [16]
The Associated Press likewise described a muted to negative immediate reaction for some names on the day, while noting Canopy was still up significantly for the month amid anticipation of the policy shift. [17]
That “up, down, repeat” pattern isn’t just vibes — it’s structure. High retail participation, heavy options activity, and meaningful short interest can amplify moves in both directions.
Company-specific catalyst: Canopy’s plan to acquire MTL Cannabis (announced Dec. 15)
While Washington has been driving the sector’s mood, Canopy also has its own corporate storyline in motion.
On Dec. 15, 2025, Canopy Growth announced it had entered into an agreement to acquire MTL Cannabis Corp. in a transaction valued at about C$125 million on a fully diluted equity basis (and about C$179 million enterprise value). [18]
Deal terms (what Canopy is paying)
Under the arrangement, each MTL shareholder is set to receive:
- 0.32 of a Canopy Growth share, plus
- C$0.144 in cash per MTL share. [19]
Canopy highlighted the implied valuation and premium using market prices and VWAP benchmarks as of Dec. 12, 2025. [20]
Why Canopy wants MTL
Canopy’s press release makes the strategic logic clear:
- MTL’s medical platform (including patient network, clinics under the Canada House brand, and online channel Abba Medix) is positioned as a way to strengthen Canopy’s standing in Canadian medical cannabis. [21]
- The deal is also pitched as supply-chain leverage: integrating MTL’s cultivation assets to increase high-quality flower supply for Canada and international markets, including Europe. [22]
- Canopy said the transaction is expected to generate about C$10 million in run‑rate synergies within 18 months. [23]
Canopy also emphasized MTL’s reported trailing results (as presented in the release), including C$84 million net revenue in the trailing twelve-month period ended Sept. 30, 2025 and C$11 million operating cash flow for that period. [24]
Timing: not immediate
This isn’t a “tomorrow morning” close. Canopy said the shareholder meeting is expected in Q1 2026 and that, assuming approvals and conditions, the deal is expected to close before the end of February 2026. [25]
Canopy’s fundamentals: improving cost discipline, but still a tough profitability journey
In its most recent reported quarter, Canopy has pointed investors toward a familiar trio: revenue stabilization, cost discipline, and balance-sheet management.
In its Nov. 7, 2025 release for the quarter ended Sept. 30, 2025 (Q2 FY2026), Canopy reported:
- Net revenue of C$66.683 million, up 6% year over year. [26]
- Cannabis net revenue of C$50.852 million, including Canada adult-use up 30% and Canada medical up 17% year over year. [27]
- An operating loss from continuing operations of about C$16.9 million, described as a significant improvement year over year. [28]
- Adjusted EBITDA loss of about C$3.0 million (a smaller loss than the year‑ago period). [29]
- C$298.1 million in cash and cash equivalents at Sept. 30, 2025, and the company said conditions that previously raised substantial doubt about its ability to continue as a going concern had been resolved. [30]
Those numbers point to a company trying to grind its way toward sustainability — not one that’s “fixed” yet.
Dilution watch: the US$200 million at-the-market (ATM) program remains an overhang
One reason CGC often struggles to hold rallies is that investors remain sensitive to dilution risk.
On Aug. 29, 2025, Canopy announced a new US$200 million at‑the‑market equity program, allowing the company to issue and sell shares from time to time on Nasdaq/TSX (with a stated cap for Canadian sales within the program). [31]
Canopy said proceeds could be used for investments, acquisitions, working capital, and potential debt repayment — reasonable corporate uses, but ones that can still pressure the stock if issuance becomes heavy. [32]
Canopy’s U.S. “optionality”: exposure exists, but the structure is complex
Another pillar of the Canopy narrative is its indirect U.S. footprint.
In the MTL acquisition release, Canopy described having indirect exposure to the U.S. THC market through an unconsolidated, non-controlling interest in Canopy USA, and stated that Canopy USA’s portfolio includes Acreage Holdings, Wana (edibles), and a majority stake in Jetty (extracts/vape technology). [33]
For investors, the practical takeaway is that U.S. reform headlines can move CGC sharply — even though Canopy’s core reported operations remain primarily in Canada and select international medical markets.
The latest forecasts and analyst read-throughs as of Dec. 24, 2025
Here’s where the “forecast” picture gets weird — not because nobody has opinions, but because traditional price-target coverage appears thin.
Analyst ratings: cautious, leaning negative
- MarketBeat’s aggregated view (as updated Dec. 24, 2025) shows a consensus of “Reduce” based on 5 analyst ratings (2 Sell, 3 Hold), and reports no current consensus price target. [34]
- StockAnalysis states there have been no analyst price target forecasts in the last 12 months, while listing a general consensus rating of “Hold.” [35]
- Barchart lists an overall rating of Hold, and shows an average earnings estimate of -0.03 for the quarter ending Dec. 31, 2025 (with 3 estimates ranging from -0.07 to 0.01). [36]
These aren’t contradictory so much as they are a reminder that “consensus” depends heavily on which analysts and data providers are included — and cannabis coverage has ebbed over the years.
One published model forecast (not a consensus view)
A Cantech Letter report cited an analyst forecast projecting Canopy revenue of C$285.5 million in fiscal 2026 with negative adjusted EBITDA, followed by a return to profitability in fiscal 2027 with C$298.2 million revenue and positive adjusted EBITDA (figures attributed in that report). [37]
That is a single-analyst scenario, not a market-wide forecast — but it reflects the framework many investors are using: Can Canopy get to durable profitability before capital markets force more dilution?
Short interest and volatility: fuel for sudden squeezes — and sudden drops
CGC’s trading dynamics still look like a powder keg:
- MarketBeat reports short interest of 43.56 million shares as of Nov. 14, 2025, about 18.19% of the public float, with a days-to-cover ratio around 2.0. [38]
- Options metrics point to unusually high implied volatility and large expected short-term ranges. [39]
High short interest doesn’t guarantee a short squeeze — but it does help explain why CGC can gap violently on headlines.
What to watch next: the 5 near-term catalysts that matter most
Heading into year-end and early 2026, CGC’s “next move” likely hinges on a short list:
- DEA rulemaking progress and the administrative law hearing referenced in the White House executive order (the process is underway, but timing is uncertain). [40]
- Clarification of what Schedule III would change in practice, especially around taxes (280E), capital markets, and research access. [41]
- Closing milestones for the MTL Cannabis acquisition, including shareholder approval, court and regulatory approvals, and Canopy’s integration execution. [42]
- Whether Canopy taps the ATM program aggressively (a factor that can cap rallies even in bullish tape). [43]
- Signs of sustained operating improvement, building on Q2 FY2026 results showing higher Canadian cannabis revenue and improved adjusted EBITDA trend. [44]
Bottom line
Canopy Growth Corporation stock is being priced today as a high-volatility option on two stories happening at once: policy normalization in the U.S. and a company-specific turnaround effort in Canada anchored by cost discipline and the proposed MTL Cannabis acquisition.
If the Schedule III process accelerates in a way that meaningfully changes U.S. industry economics — especially around taxes — CGC can keep moving with the group, even if its direct operating exposure is more complicated than many headline readers assume. [45]
But the same forces that power fast upside (retail flow, high options volatility, high short interest) can also punish crowded optimism when headlines disappoint. [46]
References
1. stockanalysis.com, 2. ca.investing.com, 3. stockanalysis.com, 4. stockanalysis.com, 5. www.barchart.com, 6. www.whitehouse.gov, 7. www.whitehouse.gov, 8. www.whitehouse.gov, 9. www.whitehouse.gov, 10. www.congress.gov, 11. www.congress.gov, 12. www.reuters.com, 13. www.reuters.com, 14. www.whitehouse.gov, 15. www.congress.gov, 16. www.reuters.com, 17. apnews.com, 18. www.canopygrowth.com, 19. www.canopygrowth.com, 20. www.canopygrowth.com, 21. www.canopygrowth.com, 22. www.canopygrowth.com, 23. www.canopygrowth.com, 24. www.canopygrowth.com, 25. www.canopygrowth.com, 26. www.canopygrowth.com, 27. www.canopygrowth.com, 28. www.canopygrowth.com, 29. www.canopygrowth.com, 30. www.canopygrowth.com, 31. www.canopygrowth.com, 32. www.canopygrowth.com, 33. www.canopygrowth.com, 34. www.marketbeat.com, 35. stockanalysis.com, 36. www.barchart.com, 37. www.cantechletter.com, 38. www.marketbeat.com, 39. www.barchart.com, 40. www.whitehouse.gov, 41. www.reuters.com, 42. www.canopygrowth.com, 43. www.canopygrowth.com, 44. www.canopygrowth.com, 45. www.reuters.com, 46. www.reuters.com
