3 Risky Stocks That Are Cash-Burning Machines
Investors should be wary when it comes to cash-burning companies. These are businesses that aren't generating positive cash flow from their day-to-day operations. Not only does that mean their operations aren't sustainable, but it might mean their future survival depends on new sources of funding. That includes new share offerings, which dilute investors and send stock prices crashing.
Three cash-burning stocks that are particularly concerning are Canopy Growth (NASDAQ: CGC), Plug Power (NASDAQ: PLUG), and SoundHound AI (NASDAQ: SOUN).
Canadian cannabis producer Canopy Growth has made a lot of changes over the years to slim down its business and cut costs, but it has failed to result in a sustainable, cash-generating operation. Cannabis companies often like to show progress in terms of adjusted earnings numbers. But oftentimes, those calculations can be complex and make it difficult to determine whether the company really did well.
Source Fool.com
