If you’re wondering if this is the bottom for Canopy Growth Corporation (NASDAQ: CGC) join the club. Investors have been wondering for the past three years that the market could, quite frankly, fall further. If you’re wondering why Canopy Growth Company’s shares are up over 26% and? appear to confirm a bottom it is due to the purchase of Area Holdings (OTCMKTS: ACRDF). The purchase is expected to be an all-stock deal worth 0.45 CGC shares for each share of AREA, but it has yet to meet shareholder approval. The reason is to accelerate Canopy Growth Corporation’s move to the US market, which it has been slowly working on.

Canopy Growth gears up for US legalization

Canopy Growth Company gears up for US legalization, but don’t hold your breath. Both Canadian and US cannabis companies have been “getting ready” for US federal cannabis legalization for a long time, and it could be a long time before that happens. For Canopy, a move into the US market could be worth as much as $50 billion even without federal legalization, so it might not matter. The real hurdle is still banking, the multi-state operators are having some success, but they are still plagued with banking problems that keep them locked out of many mainstream services.

A recent survey by the American Banking Association found that 66% of Americans support the cannabis industry’s ability to access financial services such as basic banking, but it really comes down to the politicians. The SAFE Banking Act has passed through the House many times but has yet to be voted on and maybe not if there is no change in leadership. The midterm elections are just a few weeks away and will have a resounding impact on the future of the US cannabis market. The surge in Canopy Growth Company’s stock may be driven by hopes that cannabis-friendly politicians will retain and win seats.

What is acreage positions?

Acreage Holdings is a US-based multistate integrated cannabis operator. The company has operations in 10 states, including 27 dispensaries, 9 growing facilities and 7 brands. Total projected revenue for 2023 is expected to exceed $310 million, making it one of the larger operators. The deal will merge Acreage with Canopy Growth Company’s U.S. arm Canopy USA, LLC. The news has also boosted other major Canadian and US operators, but investors are urged not to read too much in the news until after the election.

The Analysts Hold Canopy Growth Company

The analysts love Canopy Growth Company and that amounts to a buy if you are not. The caveat is that it’s a weak Hold that borders on selling according to Marketbeat.com’s tracking tools and the sentiment is falling. The price target, on the other hand, offers about 165% of the upside point at the consensus, but there is also a caveat here. The consensus target has been relatively stable for the past three months, but the low price target, which suggests about 33% of the downtrend is coming, is one of the most recently set targets.

The chart of CGC is promising, but we have seen bottom actions before. If it doesn’t pay off, it could cause the stock to fall again and go back to the very lowest level. One scenario that could trigger such a decline is a red swing from both houses that will put cannabis firmly on the shelf for the next two years.