April 8, 2019 / 1:37 PM / 8 months ago

BUZZ-Supply woes to hit cannabis firms, esp Tilray, says Cowen

** Cowen analyst Vivien Azer lowers rev estimates throughout Canadian cannabis coverage, saying her current read suggests Q1 growth will likely be modest

** Canada clearly remains supply constrained, Azer says, based on Tilray management comments at recent investor meet and Cowen analysis

** Says Tilray’s asset-light approach makes it “over exposed” to such tightness, which could persist for another 18+ months, and co will continue to face elevated ASPs near term

** Says while mid-sized producers Tilray, Cronos and Hexo expect significant ramps H2 due to additional supply and novel form factor introduction, larger scale players like Aurora Cannabis and Canopy Growth will also be hit by slower retail rollout, particularly in Ontario

** TLRY down ~1%; CGC off 0.5% and CRON 0.3%; ACB, Hexo flat

** Azer though bullish on long-term industry story and keeps “outperform” ratings on ACB, CGC and TLRY and “market perform” on CRON

Reporting by Savio D'Souza

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