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As Aurora Cannabis inches toward profitability, its Canadian rival Canopy Growth might not see positive earnings for the next 2 years, according to an analyst’s report.

The back story. Canopy Growth (ticker: CGC) split with its co-founder and co-CEO Bruce Linton last week. Constellation Brands (STZ), Canopy’s 38% stakeholder, was growing tired of losing money. Not long after another quarterly earnings miss, Linton was out of a job.

Co-CEO Mark Zekulin was named sole chief executive as the company searches for a new leader. The stock initially rose on the news, but has fallen more than 9% since July 3.

What's new.Jefferies analyst Ryan Tomkins met with Chief Financial Officer Mike Lee about the company’s prospects on Thursday.

According to Tomkins, Canopy says Ebitda, or earnings before interest, taxes, depreciation and amortization, could be negative for the next 2 fiscal years. That is in contrast to Aurora Cannabis (ACB), which some analysts think could hit positive Ebitda this quarter.

Tomkins said Canopy is hoping its Canadian operations are profitable during fiscal-year 2021. It is also focused on “hitting 40% group gross margins by the end” of fiscal year 2020. When asked what will be different, Lee told Tomkins the company would keep “the momentum going, with a healthy dose of focus.”

Canopy will also introduce “greater accountability through reporting to budgets,” Tomkins said, and noted that the company will begin following U.S. GAAP accounting standards.

Canopy Growth stock fell 4% to $37.07 on Thursday. The S&P 500 rose 0.2%.

Looking Ahead. Canopy expects to have a new chief executive by the end of December. It is looking for someone with international experience, and possibly pharmaceutical experience, who knows how to improve market share and exploit new business segments, Tomkins wrote.

The company will report fiscal 2020 first-quarter earnings in August. Tomkins said he doesn’t to expect significant changes in sales or gross margins from the previous quarter. Second-quarter sales, however, could benefit from a 34-metric-ton harvest during the first quarter.

Canopy is also excited about cannabis-spiked beverages, believing it has the “greatest potential to bring new users into the category,” Tomkins wrote. Those beverages could hit shelves in Canada by mid-December, pending Health Canada approval.

Write to Connor Smith at connor.smith@barrons.com