2 Reasons to Stay Away From HEXO After Its Blowout Third Quarter

HEXO (NYSE: HEXO) released its earnings report for the third quarter of fiscal year 2020 on June 11, and the pot grower managed to impress investors for a change. During this quarter, HEXO's net revenue of 22.1 million Canadian dollars increased by 70% year-over-year and 30% sequentially. The cannabis company also seems to have gotten its expenses under control. During the third quarter, HEXO's operating expenses came in at CA$26.8 million, significantly better than the CA$281.5 million operating expenses the company recorded during the second quarter. 

Further, HEXO's net loss of CA$19.5 million shrunk from the CA$298.2 million net loss recorded during the previous quarter. One of the catalysts for the company's higher sales during the third quarter was its leading market share in the province of Quebec, the second-largest Canadian province by population. According to HEXO CEO Sebastien St-Louis, the company holds a greater than 30% market share in this province.

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Source Fool.com