ZBISF - CIBC sees bull case for HEXO following acquisition upgrades shares to outperformer

CIBC analyst John Zamparo has upgraded shares of HEXO Corp. (HEXO) to outperformer and more than doubles his price target from C$5.60 to C$13.50.Zamparo cites HEXO's $235M acquisition of Zenabis Global (ZBISF), announced yesterday, as a major catalyst.He says that Zenabis should being in at least an extra $60M in revenue.For HEXO, Zamparo estimates fiscal 2022 sales of $240M and fiscal 2023 sales of $300M.He adds that cost synergies make Canadian cannabis M&A work and those synergies apply "to virtually anyone in the cannabis space."Zamparo says that HEXO's multiple is below its peers and Zenabis gives the company much greater exposure to international markets.HEXO shares are down 4.6% to $8.70 premarket

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CIBC sees bull case for HEXO following acquisition, upgrades shares to outperformer