What happened Shares of Hexo (NYSE: HEXO) plummeted on Tuesday after the cannabis company said it planned to raise cash via a stock and warrant sale. As of 1:15 p.m. EDT, the stock was down 29%. So what Hexo announced on Monday that it expected to raise approximately 50 million Canadian dollars by selling units containing stock and warrants. Each unit will contain one share of Hexo common stock and one half of a warrant that gives the holder the right to purchase stock at a preset price in the future. Each full warrant will give the holder the right to buy one common share of Hexo for C$1.05 ($0.76). Warrant holders will be able to exercise those rights for a period of 5 years following the closing date of the offering, which is expected to be on May 21. Hexo priced the offering at C$0.90 ($0.65) per unit, which, when factoring in the value of warrants, was significantly below where its shares were trading on Monday. Shares of Hexo Corp fell sharply on Tuesday. Image source: Getty Images. Now what Like many cannabis companies, Hexo is facing a cash crunch as it struggles to reach profitability. The beleaguered marijuana producer posted a net loss of nearly $300 million in its fiscal second quarter, which ended Jan. 31 -- and more losses likely lie ahead. Thus, Hexo has no choice but to raise cash by selling its stock at fire-sale prices, much to the chagrin of current shareholders. 10 stocks we like better than HEXO Corp.When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.* David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and HEXO Corp. wasn't one of them! That's right -- they think these 10 stocks are even better buys. See the 10 stocks *Stock Advisor returns as of April 16, 2020 Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool recommends HEXO. The Motley Fool has a disclosure policy.Source