The big day is nearly here. On Thursday, Nov. 14, prior to the opening bell, the largest marijuana stock in the world by market cap, Canopy Growth (NYSE:CGC), will announce its fiscal second-quarter operating results.

What should investors be looking for? According to Wall Street's consensus, Canopy is slated to generate 109.5 million Canadian dollars ($82.8 million) in revenue (note: this estimate is typically for gross revenue, before net excise taxes), up from CA$103.4 million in gross revenue in the sequential first quarter, and produce a loss of CA$0.39 per share. That would be considerably smaller than the CA$1.52 per share lost in the year-ago quarter. For what it's worth, Canopy's loss per share has been considerably larger than Wall Street's expectation in each of the past four quarters.

Of course, this upcoming operating report isn't entirely about Canopy's headline figures. Here are five things I believe investors should expect when Canopy Growth delivers its fiscal second-quarter results tomorrow.

A tipped over white bottle that's spilled dried cannabis buds atop a messy pile of cash.

Image source: Getty Images.

1. Margin improvement

First of all, investors should count on the company to deliver sequential quarterly margin improvement over the ridiculously low 15% gross margin reported in the fiscal first quarter.

Canopy Growth should be nearing completion on capacity expansion projects, and a ramp-up in planting across these sites should help drive costs lower and improve operating efficiency. While it would be foolish (with a small 'f') to expect Canopy Growth to be operating anywhere near peak efficiency, it would be wise to expect the company's gross margin to have improved off of first-quarter levels.

2. Big losses continue

Investors should expect Canopy Growth to have lost a lot of money in the second quarter – probably more than Wall Street expects. The company's philosophy has long been to gain market share at the expense of short-term profitability, and problems throughout the Canadian market have exacerbated the company's near-term losses. I'll touch on these issues in the next point.

Despite having an impressive overseas presence, Canopy's international investments also aren't paying much in the way of dividends, as of yet. With a number of countries still working on medical marijuana legislation, and Canadian cannabis demand nowhere near satiated, Canopy's sales ceiling remains low, while its potential for losses looms large.

A magnifying glass being held over a company's balance sheet.

Image source: Getty Images.

3. Deflecting a big problem

Thirdly, Canopy Growth is likely to blame Canada's supply problems (which I promised to discuss) for its ongoing losses and weak sequential quarterly sales growth.

As you may be aware, Health Canada entered the year with an enormous backlog of cultivation and sales license applications, and the agency has been unable to effectively work through this backlog. This means growers have been waiting months, or more than a year in some cases, for the green light to produce or sell their product.

Likewise, certain provinces have been notoriously slow to OK the licensing of physical dispensaries. As an example, Ontario, which is home to 14.5 million people, has just two dozen open retail stores where cannabis can be legally purchased. This paves the way for black market producers to fill the gaps where legal supply is limited.

While these supply problems are a tangible issue, it's really a deflection of Canopy's biggest expense: its share-based compensation. Expect share-based compensation to remain Canopy's Achilles' heel moving forward.

4. Hammering home the CEO search

In early July, Canopy's board fired then co-CEO and company visionary Bruce Linton. Though losses ballooned under Linton's watch, the company also expanded into numerous countries, and it snagged a $4 billion equity investment from Corona and Modelo beer maker Constellation Brands. Mark Zekulin, the current CEO (who co-CEO'd with Linton), will also be stepping down once a permanent CEO is found.

You can almost count on management hammering home that the search for a permanent solution at Canopy's helm is narrowing down. The company has stated that it wants a new CEO in place before the end of calendar year 2019, and I believe Wall Street is getting antsy having to wait to find out who it'll be. One thing is for sure: the new CEO will be tasked with reigning in spending at the company.

An up-close view of a flowering cannabis plant growing in a commercial indoor farm.

Image source: Getty Images.

5. A new game plan

Lastly, I strongly believe you're going to see a new game plan unveiled at Canopy Growth. Whether it's stated in the company's press release, via the conference call with analysts, or in management discussion and analysis section that can be found posted on SEDAR, I'd be surprised if Canopy Growth's management doesn't embrace the industry's ongoing maturation and near-term growing pains by adjusting its own growth strategy.

What might that entail? Well, HEXO and Green Organic Dutchman have already trimmed their production outlook for the following year, with HEXO and CannTrust both cutting jobs, albeit for different reasons. The board's firing of Linton signals the growing importance of the company's bottom line and the image it projects to shareholders. Canopy's growth strategy moving forward is likely to consist of cost-reducing measures and a potential pullback on its aggressive acquisition strategy, especially with goodwill soaring in recent quarters.

Although one quarter does not define the company's prospects, I believe Canopy Growth still has a lot to prove to support a still lofty valuation. As such, I'd suggest investors take a watch-and-wait approach from the safety of the sidelines for the time being.