Proposal to legalize marijuana in NY sends stocks soaring for Rochester company

New York: Going to Pot?

ROCHESTER, N.Y. (WROC) — Rochester-based wine and beer company Constellation Brands announced its fiscal earnings for the last quarter of 2020 Thursday morning. They were higher than expected – causing their stock trades to peak.

The reason: Constellation has been investing in a major Canadian marijuana company, Canopy Growth, for years. It’s primed to profit now that state lawmakers are again discussing the possibility of legalizing it here.

MORE | Legislation for recreational marijuana, online sports betting proposed in New York state

Constellation Brands could not speak to News 8 on Thursday, so we turned to a local financial expert George Conboy, of Brighton Securities, to tell us what it could mean.

“The big news for Constellation Brands today,” Conboy said, “was they revalued their Cannabis subsidiary upward. Their cannabis business is worth more, because as marijuana legalization across the country takes additional steps, there’s reasonable expectation that Constellation Brands will make a profit from the Cannabis subsidiary.”

Constellation Brands has spent billions to invest in this company for several years now – but they haven’t always made a profit. Now Conboy says they’re turning a corner.

MORE | What legalizing marijuana in New York could mean for local business, communities

“We’re seeing more states legalizing, we’re seeing Constellation able to revalue their investment higher, and that translated into higher earnings for Constellation, and a higher stock price.”

Conboy says a legalization like this wouldn’t necessarily mean everyone prospers from it. With any new business in the market, there’s going to be competition. But with that in mind, he says Constellation Brands has the experience for it, and they’d certainly have a leg up.

“Constellation Brands already deals with a legal intoxicant, alcohol, and they deal in all 50 states, so this is skilled business in regulatory requirements of legal intoxicants.”

And what could this mean for Rochestarians?

“More success and profit at Constellation Brands likely means more jobs in the Rochester area, more taxes paid by those jobs, and more philanthropy,” he said.

Constellation Brands are big philanthropists for local concert venue CMAC, and Rochester Regional Health’s Constellation Sands Center.

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