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    C21 Investments Inc.'s (CSE:CXXI) 26% Share Price Surge Not Quite Adding Up

    Simply Wall St·01/02/2026 10:27:12
    語音播報

    C21 Investments Inc. (CSE:CXXI) shareholders are no doubt pleased to see that the share price has bounced 26% in the last month, although it is still struggling to make up recently lost ground. The last month tops off a massive increase of 108% in the last year.

    Although its price has surged higher, you could still be forgiven for feeling indifferent about C21 Investments' P/S ratio of 1.4x, since the median price-to-sales (or "P/S") ratio for the Pharmaceuticals industry in Canada is also close to 1x. However, investors might be overlooking a clear opportunity or potential setback if there is no rational basis for the P/S.

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    See our latest analysis for C21 Investments

    ps-multiple-vs-industry
    CNSX:CXXI Price to Sales Ratio vs Industry January 2nd 2026

    How Has C21 Investments Performed Recently?

    C21 Investments has been doing a good job lately as it's been growing revenue at a solid pace. One possibility is that the P/S is moderate because investors think this respectable revenue growth might not be enough to outperform the broader industry in the near future. If that doesn't eventuate, then existing shareholders probably aren't too pessimistic about the future direction of the share price.

    Although there are no analyst estimates available for C21 Investments, take a look at this free data-rich visualisation to see how the company stacks up on earnings, revenue and cash flow.

    Do Revenue Forecasts Match The P/S Ratio?

    In order to justify its P/S ratio, C21 Investments would need to produce growth that's similar to the industry.

    Retrospectively, the last year delivered an exceptional 16% gain to the company's top line. Revenue has also lifted 12% in aggregate from three years ago, mostly thanks to the last 12 months of growth. So we can start by confirming that the company has actually done a good job of growing revenue over that time.

    Comparing the recent medium-term revenue trends against the industry's one-year growth forecast of 13% shows it's noticeably less attractive.

    With this information, we find it interesting that C21 Investments is trading at a fairly similar P/S compared to the industry. It seems most investors are ignoring the fairly limited recent growth rates and are willing to pay up for exposure to the stock. They may be setting themselves up for future disappointment if the P/S falls to levels more in line with recent growth rates.

    The Bottom Line On C21 Investments' P/S

    C21 Investments' stock has a lot of momentum behind it lately, which has brought its P/S level with the rest of the industry. We'd say the price-to-sales ratio's power isn't primarily as a valuation instrument but rather to gauge current investor sentiment and future expectations.

    We've established that C21 Investments' average P/S is a bit surprising since its recent three-year growth is lower than the wider industry forecast. When we see weak revenue with slower than industry growth, we suspect the share price is at risk of declining, bringing the P/S back in line with expectations. Unless the recent medium-term conditions improve, it's hard to accept the current share price as fair value.

    And what about other risks? Every company has them, and we've spotted 3 warning signs for C21 Investments (of which 2 are concerning!) you should know about.

    If strong companies turning a profit tickle your fancy, then you'll want to check out this free list of interesting companies that trade on a low P/E (but have proven they can grow earnings).