Sell-side analysts at Stifel initiated coverage of Aphria Inc. /zigman2/quotes/207425803/composite APHA +2.33% /zigman2/quotes/205566616/delayed CA:APHA +2.00% with a hold rating and Hexo Corp. /zigman2/quotes/206508254/composite HEXO +11.30% /zigman2/quotes/200008967/delayed CA:HEXO +13.44% with a sell rating on Tuesday. Stifel analyst W. Andrew Carter writes in the Aphria note that his bank is beginning with a C$4.50 target price target. Aphria's revenue growth and strong balance sheet underpins the rating, balanced by the bank's outlook for the business to scale and offer margins much like other consumer packaged goods companies, Carter writes. Stifel is modelling 89% cumulative annual growth from the Ontario-based company's weed operations over the next two years and that it will maintain its market share under Canada's recreational regime. But, Carter says his team expects ongoing expenses and uncertainty related to Canada. Turning to the Quebec-based Hexo, Carter writes that the C$1.15 target price and sell rating reflects the bank's view that the marijuana company has "precarious positioning" in Canada. Hexo's ongoing cash crunch and a management "credibility gap" will be difficult to overcome, Carter writes, and the company has limited potential to drive the "robust growth outlined by the company." Because Hexo executives have so aggressively talked about growth, Carter says that institutional investors will not give them any benefit of the doubt and that the company will have to execute "through the current environment to attract interest, let alone drive enthusiasm for shares." Stifel also outlined a "liquidation scenario" that values Hexo at C$0.84 and said that the company's exposure to Quebec has created barriers to growth because policymakers have enacted "incremental restrictions limiting the growth potential of the category." U.S.-traded shares of Hexo rose 1.4% to $0.95 in afternoon trading Tuesday, as Aphria shares climbed 1.2% to $2.88. The Cannabis ETF /zigman2/quotes/213173823/composite THCX +3.82% fell 0.3% Tuesday and the S&P 500 index /zigman2/quotes/210599714/realtime SPX -0.22% gained 1.7%.