Canadian pot producer Canopy Growth (CGC) has a market value around $9.5 billion, helped by a huge investment from Corona parent Constellation Brands(STZ) and control over a big chunk of Canada's recreational weed market. It has struck up collaborations with celebrities like better-living guru Martha Stewart and actor Seth Rogen. It has a deal to eventually buy Acreage Holdings, a U.S. cannabis company backed by former House Speaker John Boehner, potentially giving it a jump on Canadian rivals once the U.S. legalizes cannabis on a federal level. But as Canopy and other marijuana stocks lose money, is Canopy Growth stock a buy right now?

Below, we dig into the fundamentals and technical analysis.

Canopy Growth Fundamental Analysis: Still No Profits

Canaccord analyst Matt Bottomley said in a report last month that Canopy Growth had "by far the #1 position in the Canadian market." Some analysts this year have estimated that its recreational market share stands at around 30%. Stifel analyst W. Andrew Carter in June called Canopy Growth stock "the best investable opportunity" in the industry, saying the pot company was ahead of rivals in building out infrastructure to serve Canada's legal market.

Still, the stock's EPS Rating, which measures profit growth on a scale of 1 to 99, is a weak 21. Like other big marijuana producers, Canopy is losing money as it invests in domestic and international expansion. Earnings growth is a hallmark of top stocks.

Canopy Growth believes its investments will make up for those losses.

But investors haven't always been so patient. CGC stock tumbled in June after Canopy reported a per-share loss in fiscal Q4 of 98 cents Canadian, far bigger than analysts expected.

Margins shrank from the prior quarter, hit in part by operating costs partly related to "facilities not yet cultivating or facilities that had underutilized capacity."

But what Canopy lacks in earnings it makes up for in sales growth — another key component to strong stocks. Year over year, Canopy's fiscal Q4 sales jumped 313%. Sales rose 13% from the prior quarter. However, sales of recreational cannabis dipped.

The company isn't alone in disappointing investors as Canada's legal weed industry deals with shortages and licensing delays, and tries to grow enough pot to match supply with demand. Shares of rival Hexo (HEXO) fell when the company reported in June a decline in sales quarter over quarter. Aphria (APHA) also took a hit after it reported earnings in April.

Still, analysts see Canopy Growth's per-share losses shrinking from $2.02 in fiscal 2019 to 53 cents in 2020 and just 2 cents in 2021.

Canopy Growth Stock Technical Analysis

CGC stock has a Composite Rating of 43 out of a best-possible 99, according to MarketSmith. Investor's Business Daily research shows the biggest stock winners typically have Composite Ratings in the 90s.

The relative strength line, which compares the stock's performance to the S&P 500, has fallen since April to its lowest level in nearly six months.

Canopy Growth stock is also below its 50-day and 200-day moving averages.

CGC stock consolidated from February through April, but the pattern fell apart. IBD advises investors to buy stocks only after they rise above certain resistance levels, called buy points, after setting up proper bases. That research shows that when a stock breaks past such a buy point after shaking out more skeptical investors, it could mean a longer run higher is ahead.

Canopy Growth stock first listed on the New York Stock Exchange in May 2018. Shares jumped 30% after Constellation Brands announced its $4 billion investment in the company in August. Like others, CGC stock reached a high point on Oct. 16, a day before recreational cannabis sales began. Shares fell after that and rebounded into January.

CGC Stock Vs. Other Marijuana Stocks

Among other marijuana stocks, Cronos Group (CRON) has a better Composite Rating and EPS Rating — 61 and 38, respectively. Those are the best ratings for any of the pure-play marijuana stocks on U.S. exchanges. But they still aren't exactly inspiring.

Canopy Growth's other rivals have fared worse, by IBD's metrics. Tilray (TLRY) has a weak Composite Rating of 8, with an EPS Rating of 1. For Aurora Cannabis (ACB), those numbers stand at 33 and 3, respectively. For Aphria (APHA), those ratings are 21 and 26.

Other marijuana stocks, like Hexo (HEXO), CannTrust (CTST) and Organigram(OGI), have similar ratings.

The most highly rated marijuana play remains Innovative Industrial Properties(IIPR). That company, a real estate investment trust that backs greenhouse buildings and others in the medical marijuana space, has a Composite Rating of 98. The stock cleared a 93.24 buy point in June, but is well extended from that entry.

Constellation Brands 'Not Pleased'

In 2017, Constellation Brands said it would take a nearly 10% stake in Canopy Growth, with plans to focus on cannabis-infused beverages. Constellation a year later expanded that stake to nearly 40%, and said it would support the "full suite" of Canopy's products.

But as Canada's legal weed market stumbles, analysts have raised more questions about Constellation's investment. They've wondered whether Constellation Brands bet too early and too aggressively in a new, competitive industry. They also raised doubts about how popular cannabis beverages will be once legal.

Constellation Brands in June said it was "not pleased" with the quarterly results Canopy Growth reported that same month. But the beverage company said it was still happy with its investment, and continued to "aggressively support" Canopy in its efforts to expand and achieve profitability.

Constellation Brands said it still believes Canopy Growth can hit a $1 billion sales run rate by the end of next fiscal year, assuming the business environment remains where it is now.

Other Canopy News

Canopy Growth also plans to begin producing hemp in New York state. The 2018 Farm Bill legalized hemp, leading Canopy and others to figure out how they could begin producing CBD, or cannabidiol, which comes from hemp and is used for pain relief, but doesn't produce a high. Canopy in April said it had secured a 308,000-square-foot facility in Kirkland, N.Y., toward that end.

In June, Canopy also said it got a license that will allow it to grow cannabis outdoors at a 160-acre site in Saskatchewan. The move, Canopy said, will complement its indoor grow and processing spaces and help it "provide a leading balance of facilities to produce low-cost input materials for value-add products, while ensuring more sophisticated growing operations for in-demand flower products."

The company announced the extra outdoor acreage — part of what the company described as a pilot project — a little more than a year after CEO Bruce Linton expressed reservation about the quality of outdoor grows and their "potential for diversion" to the illegal market, a BNN Bloomberg story noted.

"We're not sure this is going to be a long-term business for us but we need to try everything," Linton told the news outlet in June.

Outdoor growing, the argument goes, is cheaper than managing the temperature-controlled environment of an indoor facility. The counter-argument is that quality gets sacrificed in the process of saving money.

Canopy Growth Stock Is Not A Buy

Canopy Growth's sales growth is strong, and Wall Street expects its losses to narrow in the years ahead. The Canadian pot producer is expanding rapidly and has locked down a number of high-profile partnerships. But it's losing a lot of money in a nascent industry fraught with regulatory and legal hurdles.

More importantly, CGC stock isn't in any kind of base pattern while lagging for several months. Wait for Canopy Growth stock to set up a bullish base pattern before considering.

The bottom line: Canopy Growth stock is not a buy as of July.