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Canaccord Genuity analyst Luke Hannan last night downgraded Alkaline Water to Sell from Hold with a price target of 90c, down from $1.25, following the company's fiscal Q4 results.

The analyst believes the recent share price appreciation is overdone. Alkaline's sales guidance for fiscal 2022 fell short of expectations, implying a slower pace of revenue growth than previously forecast, Hannan tells investors in a research note.

The analyst sees a lack of visibility into the company inflecting towards positive free cash flow, signifying an "increasing likelihood of future dilutive equity financings." Given this context, he downgraded the shares to Sell.