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Investing.com – Cannabis stocks were mostly on the back foot Monday after analysts on Wall Street cut their outlook on several producers on cash-flow worries and said sales would continue to come under pressure.

BMO analysts Tamy Chen and Peter Sklar lowered their sales and cash-flow forecasts for pot stocks, forecasting that producers will cut prices on middle-tier flower inventory ahead of new products like edibles, vapes and beverages, which are expected to launch in December.

The analysts reduced thier 2021 sales forecast for Aurora by 22% C$543 million ($425.2 million), cut Canopy sales forecast by 23% for 2021 to C$566 million, lowered their 2020 sales forecast for Cronos Group by 26% to C$174 million and lowered Tilray’s sales forecast by 15%, to C$306 million.

Canopy Growth (NYSE:) and Aurora Cannabis (NYSE:) were among the biggest decliners, both down more than 1%. Tilray (NASDAQ:), meanwhile remained in the green, up about 0.3%.

“Given the elevated inventory level currently held by provinces, which we have anecdotally heard is largely the ‘mid-range’ flower category, we believe provinces and retailers will likely implement price markdowns to accelerate product sell-through,” Chen and Sklar said.

But not all producers are in the firing line, with smaller-scale producers such as Cronos, Sundial, and Supreme expected to steal share from their more illustrious rivals, according to the note.

“We believe their flower products should have some quality differentiation relative to the over-saturated ‘mid-range’ flower segment,” the analysts said.

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