Canopy Growth Corp

Canopy Growth Corp (CGC - Get Report) shares closed Friday's session up 3.06% to $47.53 after the Canadian pot company reported a 283% increase in fiscal third-quarter revenue to C$83.1 million. 

While the company failed to meet analysts' bottom-line expectations due to an accounting quirk that chopped C$185.8 million off of the company's profit, investors seem to be forgiving of the miss, pushing the stock higher Friday. 

However, the third quarter was not all roses for the company, according to Cowen analyst Vivien Azer, who wrote Friday that she is concerned about the company's margins.

"WEED net revenues of $83 mm were up 256% sequentially, and in line with consensus, which is a relief given the meaningful miss last quarter. The offset, however, seems to be an absence of production efficiencies as cash COGS (cost of goods sold) / gram continued to climb, and was $5.11 in the quarter, a far cry from the $2-3 we see from WEED's peers," Azer wrote. 

WEED is Canopy Growth's stock symbol on the Toronto Stock Exchange.

Additionally, while the company's operating loss shrunk in the quarter, it was still sizable, according to Azer. Research and development costs more than doubled to $5 million from $2 million in the quarter, which helped lead to an EBITDA loss of $75 million, wider than the loss of $58 million seen in the previous quarter.

Azer has an outperform rating and C$82 price target, which represents a 34% upside from the stock's previous closing price in Toronto of C$61.28.