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Canopy Growth Corp. is getting bigger and bigger by the day – and in doing so, it’s become more valuable than some iconic Canadian companies.

Since U.S. alcohol giant Constellation Brands Inc. announced last week it was investing $5-billion for a larger stake in Canopy, the cannabis producer’s market value has surged 64 per cent to $11.5-billion, as of Wednesday’s close. It now ranks 54th in valuation on Canada’s benchmark stock index, the S&P/TSX Composite, out of 246 companies. When Canopy was added to the index in March, 2017, it ranked 187th out of 251 companies, with a market capitalization of $1.6-billion.

Over a short span, Canopy has vaulted past some big names. On Monday, it surpassed Bausch Health Cos. Inc. (formerly Valeant Pharmaceuticals) to become the largest company on the S&P/TSX Health Care Index. On Tuesday, it leapt past retailer Canadian Tire Corp. Ltd. On Wednesday, it rose above Bombardier Inc.

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The standard rules of valuation do not apply to cannabis companies, which trade largely on potential earnings after the recreational market becomes legal in October, along with possible opportunities abroad. In its most recent quarter, Canopy brought in about $25-million in revenue. Bausch, Bombardier and Canadian Tire all brought in billions in their most recent quarters.

So, how long will the rally last? Perhaps not much longer, according to analysts.

The forward 12-month consensus share-price estimate for Canopy is $48.64 a share. Based on Wednesday’s closing price of $52.10, that implies a drop of 6.6 per cent.

Fortunately for Canopy investors, analyst estimates are often way off the mark. The rally may yet have room to run.

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