ACB - Aurora Cannabis Inc.
9.22 -0.01 (-0.11%)
After hours: 4:06PM EDT
| Previous Close | 9.00 |
| Open | 9.02 |
| Bid | 9.17 x 47300 |
| Ask | 9.18 x 43500 |
| Day's Range | 8.93 - 9.23 |
| 52 Week Range | 4.05 - 12.52 |
| Volume | 20,241,034 |
| Avg. Volume | 30,895,695 |
| Market Cap | 9.381B |
| Beta (3Y Monthly) | 2.80 |
| PE Ratio (TTM) | 42.73 |
| EPS (TTM) | 0.22 |
| Earnings Date | N/A |
| Forward Dividend & Yield | N/A (N/A) |
| Ex-Dividend Date | N/A |
| 1y Target Est | N/A |
- ACCESSWIRE•2 hours ago
Investors Should Be Paying Close Attention to This Industry
CORAL GABLES, FL / ACCESSWIRE / April 22, 2019 / Investors should be paying close attention to the cannabis industry right now. Currently, recreational marijuana is now legal in 10 US states & medical marijuana is legal in 33 US States. Today we are highlighting: Canopy Growth Corporation (CGC) / (TSX:WEED.TO), Aphria Inc. (APHA), Aurora Cannabis Inc. (ACB), Leafbuyer Technologies, Inc. (LBUY).
- Market Exclusive•3 hours ago
Aurora Cannabis Agrees to Acquire All Hempco Shares
Aurora Cannabis (NYSE: ACB) (TSX: ACB) (Frankfurt: 21P) has signed a binding letter of intent with Hempco Food and Fiber (TSX-V: HEMP) to acquire all of the issued and outstanding common shares of Hempco. Under the deal, Aurora will pay C$1.04 per share, payable in common shares, totaling around C$63.4 million. Currently, Aurora owns about […]The post Aurora Cannabis Agrees to Acquire All Hempco Shares appeared first on Market Exclusive.
- InvestorPlace•6 hours ago
This Is Why Canopy Growth Is the Best Pot Stock
Ever since the cannabis craze hit Wall Street back in mid-2018, I've been pounding on the table saying that the best marijuana stock to buy in the group is Canopy Growth (NYSE:CGC). The logic is simple: In addition to being the biggest player in the industry, CGC stock has long had one thing that no other cannabis company has -- $4 billion in cash from Constellation Brands (NYSE:STZ).Source: Shutterstock That $4 billion gives Canopy unprecedented visibility into being one of the industry's long-term winners through early, aggressive, and large investments. As such, I have consistently reasoned that CGC stock belongs in every cannabis-related portfolio.This bull thesis got a big boost in mid-April. Canopy struck a deal with major U.S. cannabis operator Acreage to buy that company for $3.4 billion once cannabis is legalized nationwide in the U.S.InvestorPlace - Stock Market News, Stock Advice & Trading TipsFor those who don't follow this industry closely, that's a big deal. Canopy is the star player in the legal Canadian cannabis market. But the Canadian market is peanuts. The big deal here is the U.S. market. Depending on who you ask, that market is about tenfold the size of the Canadian market.Thus, the big question for Canopy and other Canadian pot stocks is whether or not these companies can replicate their success in the U.S. * 7 Strong Buy Stocks the Street Loves Canopy just answered that question in emphatic fashion, and the market is reacting favorably. CGC stock popped roughly 10% on the news.In the big picture, thanks to a $4 billion early investment from Constellation Brands, Canopy has given itself unprecedented visibility into being a long-term cannabis market leader. Right now, following the Acreage deal, that visibility is as strong as ever. Consequently, the long-term bull thesis for CGC is likewise as strong as ever. The Acreage Acquisition Is Big NewsThere's a reason CGC popped 10% in response to the company agreeing to acquire Acreage. In plain English, it positions the company to fully capitalize on the $100 billion U.S. cannabis market from the onset.First, some context. The whole Wall Street cannabis craze has been largely centered around one thing: the nationwide legalization of cannabis in Canada in late 2018. Roughly speaking, that single catalyst turned the big four Canadian pot stocks -- Canopy, Aurora (NYSE:ACB), Tilray (NASDAQ:TLRY) and Cronos (NASDAQ:CRON) -- from relatively unknown companies to Wall Street household names with multi-billion dollar market caps.But, while Canadian market legalization was the catalyst, it wasn't the prize. The prize here is the U.S. market, which most estimates put at a $100 billion opportunity, versus $10 billion in Canada. The consensus thesis is that, with cannabis fully legal throughout Canada and hemp legal throughout the U.S., it's only a matter of time before cannabis is fully legal across the entire U.S. The big question is whether or not Canadian cannabis giants like Canopy will be able to capitalize on the big U.S. opportunity when it comes knocking.Canopy just answered that question. By agreeing to acquire Acreage -- a major U.S. cannabis operator with dozens of dispensaries and cultivation sites across 20 states -- Canopy has positioned itself to capitalize on the $100 billion U.S. cannabis market opportunity from the onset. That is, as soon as cannabis is fully legal across the U.S., Canopy will be everywhere through Acreage -- and ready to dominate the U.S. market like it's dominated the Canadian market.That's a big deal. Indeed, it paves the path for CGC to head materially higher in a long-term window. Canopy Growth Stock Has Long-Term UpsideMy long-term bull thesis on Canopy Growth stock is that, if this company can successfully maintain its leadership position as the cannabis industry goes global and matures, then this is a $100 billion company in the making. With more visibility than ever to U.S. market domination, that long-term bull thesis looks about as good as ever.The details of my analysis behind the $100 billion number can be found here. But the short recap is pretty easy to understand. At scale, given current consumption trends, the recreational cannabis market could one day be as big as the alcoholic beverage and tobacco markets. What's more, if you consider the medical opportunity, then the aggregate global cannabis market will easily one day be as big as, if not bigger than, the alcoholic beverage and tobacco markets.The top dogs in those two industries have $100 billion-plus market caps. Witness Anheuser-Busch (NYSE:BUD) or Altira (NYSE:MO). Thus, it's only reasonable to assume that the top dogs in the global cannabis industry at scale will be $100 billion-plus companies too.Given its early leadership position, huge financial resources, aggressive management team, large growing capacity, and global distribution network, Canopy has all the tools necessary to turn into a top dog in the global cannabis industry in a decade. Now, Canopy also has visibility to be a top dog in the U.S. market. Thus, this company continues to take steps towards securing global leadership.So long as the company remains on that path, CGC stock will remain on an uptrend towards a $100 billion valuation. * 10 Dividend Growth Stocks You Can't Miss Bottom Line on CGC StockThere are a lot of pot stocks out there, but none of them have as much long-term visibility as Canopy Growth. Given this, if you're buying into the cannabis industry with a multi-year horizon, CGC stock is the best pick in the industry, without question.As of this writing, Luke Lango was long CGC and ACB. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 5 Dividend Stocks Perfect for Retirees * 7 Reasons the Stock Market Rally Isn't Over Yet * 10 S&P 500 Stocks to Weather the Earnings Storm Compare Brokers The post This Is Why Canopy Growth Is the Best Pot Stock appeared first on InvestorPlace.
- ACCESSWIRE•8 hours ago
Companies to Play After BofA Begins CannaCoverage- THC Therapeutics, Inc. (THCT)
HENDERSON, NV / ACCESSWIRE / April 22, 2019 / Bank of America analyst, Christopher Carey, has begun coverage of the cannabis industry with a note Wednesday naming Hexo Corp. (HEXO) as the firm's top pick ...
- CNW Group•8 hours ago
/R E P E A T -- Aurora Cannabis launches search for Canada's Top Budmaster ™/
EDMONTON , April 18, 2019 /CNW/ - Calling all Canadian budtenders! Aurora Cannabis is kicking off the search for Canada's Top Budmaster ™ through a national competition that will recognize cannabis professionals across the country who are guiding consumers as they navigate the new world of legal cannabis. Through a series of skills-based and knowledge-testing events, as well as through digital competitions, Canada's budtender community will be able to demonstrate their expertise in cultivar characteristics and histories, product categories and formats, exceptional customer service, and must also showcase how they contribute to the community and culture. As Canada's first legal 420 holiday approaches, it's time to recognize the women and men in cannabis retail stores who educate consumers every day.
- CNW Group•9 hours ago
High Tide Receives $8.4 Million from First Tranche Closing of Convertible Debenture Offering
CALGARY , April 22, 2019 /CNW/ - High Tide Inc. ("High Tide" or the "Company") (HITI.CN) (HTDEF) (2LY.F), an Alberta -based, retail-focused cannabis corporation enhanced by the manufacturing and wholesale distribution of smoking accessories and cannabis lifestyle products, today announced that it has closed the first tranche of the sale of unsecured convertible debentures (the "Debentures") of the Company under the non-brokered private placement (the "Offering") previously announced on April 10, 2019 , with gross proceeds of $8,360,000 to date. High Tide intends to close a second and final tranche of the Offering for aggregate gross proceeds of up to $15,000,000 , which has been increased from the original amount of $10,000,000 due to strong investor demand. The outstanding principal amount under the Debentures is convertible at any time before maturity and at the option of the holder, into common shares of the Company (the "Shares") at a conversion price of $0.75 per Share.
- InvestorPlace•11 hours ago
Why These Are the Top 2 Pot Stocks to Buy Right Now
One of the big themes in the cannabis sector in 2019 has been increased Wall Street coverage. Specifically, Wall Street firms were largely unwilling to cover cannabis stocks in 2018 given the industry's relative newness, rampant investor speculation and lack of fundamental tangibility. But, things have changed for marijuana stocks in 2019. The industry is less new. There's less speculation. The fundamentals have become significantly more tangible. As such, Wall Street firms have more broadly launched coverage on pot stocks in 2019.Source: Shutterstock One big firm that just initiated coverage on pot stocks is Bank of America. Their take? Of the Big Four pot stocks -- Canopy Growth (NYSE:CGC), Aurora Cannabis (NYSE:ACB), Cronos Group (NASDAQ:CRON) and Tilray (NASDAQ:TLRY) -- the only two worth buying right now are Canopy and Aurora.This isn't an isolated viewpoint. According to TipRanks data, 10 analysts cover CGC stock, while eight analysts cover ACB stock. Of those 18 ratings between CGC and ACB, none of them are Sell ratings. Instead, the consensus rating on CGC stock is "Moderate Buy" while on ACB stock, it's "Strong Buy."InvestorPlace - Stock Market News, Stock Advice & Trading TipsMeanwhile, a third of the nine analysts who cover CRON stock have a "Sell" rating on the shares. The consensus rating is a "Hold." Half of the 10 analysts that cover TLRY stock have a "Sell" rating on the name. The consensus rating on TLRY is a "Hold," too.In other words, the broad consensus among Wall Street firms is that when it comes to the cannabis space, investors should buy CGC and ACB, and forget about CRON and TLRY for the time being. I largely agree with consensus Wall Street view. Here's why. Why Buy CGC Stock?The plain answer here is you buy CGC stock because this company has the most visibility today among all pot stocks to one day transform into a long term market leader. * 7 High-Risk Stocks With Big Potential Rewards Canopy has everything you'd want in an early-stage leader in a big-growth market. Sales leadership? They dwarf everyone else in the space when it comes revenues. Growth? They are growing just about as fast as anyone in the space, despite a much bigger base. Production leadership? They sell far more kilograms of cannabis than anyone else, and have among the largest production footprints in the world. Market expansion? They are pushing aggressively into the U.S. hemp market. Confident leadership? CEO Bruce Linton just said that Canopy will generate over C$1 billion ($748 million) in sales over the next 12 months. Celebrity connections? They have ties with Seth Rogen, Snoop Dogg, and Martha Stewart.Above all else, though, Canopy has the financial resources and firepower to sustain and even grow its early lead. A few quarters ago, alcoholic beverage giant Constellation Brands (NYSE:STZ) poured $4 billion into Canopy. The company still has $3 billion of that left on the balance sheet. That's almost double what any of its competitors have in terms of cash on hand.While 2018 saw a blockbuster year (with nearly $14 billion raised) for cannabis investments, 2019 is on pace to blow past that total, according to cannabis research provider New Frontier Data. Click to EnlargeThus, Canopy has far more firepower than anyone else in this space to invest in growth opportunities, expand operations, expand production, acquire smaller players, so on and so forth. As such, the company does reasonably project as a long-term leader in the global cannabis market, and that's why buying CGC stock today makes sense. Why Buy ACB Stock?The plain answer here is you buy ACB stock because this is the cheapest pot stock in the group for reasons that are most likely temporary.On a pure valuation basis, ACB stock is as cheap as it gets in the cannabis space. Across every metric -- trailing sales, forward sales, market cap per kilogram, annualized revenue -- ACB stock is considerably cheaper than its peers. We are talking a 20%+ undervaluation gap. * 7 Stocks to Buy for Spring Season Growth This relative undervaluation has nothing to do with operating fundamentals. Aurora is big, with the second-largest sales base in the market behind Canopy. The company controls about 20% of the Canadian adult-use market. They also have tremendous production capacity (Aurora has 500,000 kilograms per year in funded capacity) and gross profit margins are among some of the healthiest in the business.Instead, the relative undervaluation in ACB stock has to do with balance sheet. Specifically, unlike peers Canopy and Cronos, Aurora hasn't scored a big investment from a consumer staples giant. Thus, the balance sheet isn't overflowing with billions of dollars to help fund growth. Instead, Aurora has just over $100 million in cash on hand.This won't last forever. Aurora is a big and leading company in the rapid growth cannabis space. The stock is also trading at a huge discount to peers. Thus, it truly is only a matter of time before some big consumer staples company pumps a billion bucks in here, or more. When that happens, the relative undervaluation gap will disappear, and ACB stock will rally in a big way. Bottom Line on CGC Stock and ACB StockThe cannabis sector reeks of long-term potential. But, a lot will happen between now, and when the market matures, and that means that investors need to choose wisely when investing in pot stocks this early in the game.Investment translation? Only buy CGC stock and ACB stock. There are very good reasons to own those two pot stocks here and now, and they should rally over the next several quarters.As of this writing, Luke Lango was long CGC and ACB. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 5 Dividend Stocks Perfect for Retirees * 7 Reasons the Stock Market Rally Isn't Over Yet * 10 S&P 500 Stocks to Weather the Earnings Storm Compare Brokers The post Why These Are the Top 2 Pot Stocks to Buy Right Now appeared first on InvestorPlace.
- Motley Fool•yesterday
5 Marijuana Stocks With the Most Debt: Should Investors Be Worried?
These companies have the highest debt levels in the cannabis industry. But there's more to the story.
- TheStreet.com•yesterday
Toke'n Economy: Pot Stock Investment Advice For 4/20 Weekend
Pot stocks may have cooled off in recent months but the industry is still hot and Bank of America Merrill Lynch expects it to get hotter as it reaches maturity. "We expect all companies to deliver attractive growth over the next few years, reflecting a low base and strong demand in a newly created legal cannabis markets, namely Canada," Bank of America Merrill Lynch analyst Christopher Carey wrote in a note. Part of the reason for the industry's cool down in recent months is that the short-term growth story for many companies has gone up in smoke.
- Motley Fool•yesterday
3 Crazy Facts About Canopy Growth's Largest Acquisition in Marijuana History
Canopy's $3.4 billion purchase of Acreage Holdings is unlike anything Wall Street or investors have ever seen.
Yahoo Finance•2 days agoBreaking the cannabis glass ceiling
Amy Margolis identified a problem in the burgeoning Oregon cannabis industry, so she set out to solve it. The problem? Despite the industry’s newness and the encouraging early statistics about gender equity, a glass ceiling has developed in the cannabis business.
- Motley Fool•2 days ago
Marijuana Stocks: Let the Writedowns Begin
There may be more to pot-stock acquisitions than meets the eye.
Yahoo Finance•3 days agoThe cannabis industry is poised for its biggest 420 yet
The “Black Friday” for Cannabis is expected to be bigger than ever this year.
- InvestorPlace•4 days ago
If You Can Tolerate Risk, Hexo Stock Is a Buy
Ah, the magic of analyst ratings! After a tough month in April, cannabis firm Hexo (NYSEAmerican:HEXO) suddenly reversed course after Bank of America analyst Christopher Carey initiated coverage. Sizing up the risk and reward profile, Carey assigned a "buy" rating on Hexo stock with a $10 price target.Source: Shutterstock The news couldn't have come at a better time. While cannabis stocks offer tremendous upside because they essentially materialize an industry that previously never existed, they're also incredibly volatile. Because this is an unprecedented sector, many investors are unsure how to approach a company like HEXO.As such, I mentioned earlier that I liked Hexo stock, even compared to relative heavyweight Aurora Cannabis (NYSE:ACB). Unfortunately, the aforementioned volatility in cannabis stocks disproportionately impacted HEXO, sending my recommendation toward a quick grave. But thanks to Carey, this bad boy gained nearly 12% on Wednesday.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 Stocks to Buy for Spring Season Growth Of course, by the time that you're reading this, this dramatic burst in Hexo stock is in the past. Do newcomers still have a chance in riding this promising, but wild bull? Underappreciated Elements Support Hexo StockThe best way I can characterize Hexo stock is as a diamond in the rough. I believe the organization has the right components in place to make a solid run. However, the credibility issues that stymie virtually all cannabis stocks will pressure HEXO. At the end of the day, it comes down to your risk tolerance.But if you're willing to take that leap, Carey argues that this weed play deserves your attention. Primarily, HEXO stock is undervalued relative to its peers. Of course, in the marijuana sector, "undervalued" is an extremely relative term. That said, many cannabis stocks have hit nosebleed levels. Therefore, HEXO at least on paper provides some assurance of future room for growth.Next, the BofA analyst mentioned that Hexo stock is levered toward a "de-risked" Canadian cannabis market. Although I wouldn't use that term specifically, I see his point. Our northern neighbors paved the way for other western and developed nations to adopt tolerant policies. While this broader dynamic is building out, management has time to hone its craft.Finally, Carey mentioned "value-add partnerships" that go beyond the scope of Hexo's existent relationship with Molson Coors Brewing (NYSE:TAP). I agree. Cannabis stocks can branch out into subsegments of the broader categories of recreational and medicinal usage. However, let's not gloss over the Molson partnership as it holds a significant key for growth.Naturally, the idea here is for Hexo and Molson to developed cannabidiol (CBD)-infused drinks. Now, CBD itself is a tailwind for the industry as it offers non-psychoactive exposure to the cannabis plant. In other words, it's a lot easier to introduce people to weed through a drink rather than a joint. Upgrade Suggests Rising Credibility for Cannabis StocksIndeed, Hexo's Molson partnership has advantages over an expected synergy like Cronos Group (NASDAQ:CRON) and Altria Group (NYSE:MO). I don't think I can ever get my parents to smoke marijuana. But to drink it in a form that won't get them stoned? That's infinitely more palatable and more socially acceptable.Invariably, that had to enter BofA's thinking process when deciding to go bullish on Hexo stock. But just the fact that the big bank is even considering cannabis stocks is a major sign. It gives the industry significant credibility, and it suggests a very viable environment in the future.While we here in the U.S. have also warmed to varying degrees of legalization, most banks won't finance cannabis-related businesses. Why? Because it comes down to that nasty roadblock called Schedule I. Despite individual state laws, cannabis falls under strict federal guidelines.Sure, we've made progress in this department, too. For instance, the 2018 farm bill won consensus at a time when bipartisanship no longer exists. And major conservative figures have more or less voiced support for full legalization.Nevertheless, that Schedule I classification remains on the books for marijuana. Unless the federal government officially extinguishes it, most banks won't touch cannabis stocks. * 5 Dividend Stocks Perfect for Retirees And while BofA isn't necessarily diving into the sector with open arms, it's essentially giving you the green light to do so. Look, Hexo stock is a risky play no matter how you cut it. But if you've got the nerve, I'd read between the lines.As of this writing, Josh Enomoto did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 7 Stocks to Buy for Spring Season Growth * This Is How You Beat Back a Bear Market * 7 Dental Stocks to Buy That Will Make You Smile Compare Brokers The post If You Can Tolerate Risk, Hexo Stock Is a Buy appeared first on InvestorPlace.
- CNW Group•4 days ago
Aurora Cannabis launches search for Canada's Top Budmaster ™
EDMONTON , April 18, 2019 /CNW/ - Calling all Canadian budtenders! Aurora Cannabis is kicking off the search for Canada's Top Budmaster ™ through a national competition that will recognize cannabis professionals across the country who are guiding consumers as they navigate the new world of legal cannabis. Through a series of skills-based and knowledge-testing events, as well as through digital competitions, Canada's budtender community will be able to demonstrate their expertise in cultivar characteristics and histories, product categories and formats, exceptional customer service, and must also showcase how they contribute to the community and culture. As Canada's first legal 420 holiday approaches, it's time to recognize the women and men in cannabis retail stores who educate consumers every day.
- ACCESSWIRE•4 days ago
Company with Solution for Indoor Growers Reporting Big Losses
One company we've highlighted in the past CleanSpark, Inc. (CLSK) has developed power solution for the cannabis industry that can reduce energy costs by up to 82%. This represents a huge potential revenue stream for the company. Due to this fact the company has stated that marketing to cannabis companies is one of their top initiatives for 2019.
- MarketWatch•4 days ago
Harry Boxer: Two marijuana stocks are among charts worth watching
Marijuana stocks are among our top charts to watch today. Bank of America Merrill Lynch named the company as one of three marijuana stocks to buy. The stock, after sharp year-to-date gains, has been consolidating in recent weeks, but may be on the verge of its next leg up with cannabis stocks in general.
- Zacks•4 days ago
Likely Canopy-Acreage Deal Looks Good Enough to Boost ETF MJ
Canopy Growth will probably purchase the rights to buy Acreage Holdings to tap the growing potential of the U.S. marijuana market. This should bolster the ETF MJ.
- TheStreet.com•4 days ago
Canopy Growth Now Has to be Considered the Leader in the Canadian Cannabis Space
The story really begins with the November 2017 investment made in Canopy Growth by Constellation Brands that left Constellation with a 38% equity stake in the firm and a pathway toward a controlling interest over a number of years. Cafina comes with a licence already in force to cultivate, distribute and export cannabis for medical and/or research purposes.
- Barrons.com•4 days ago
Marijuana Stock Aurora Cannabis Just Got Another Vote of Confidence
Aurora Cannabis stock edged up following a bullish note from Cowen & Co. that applauded management’s competitive positioning of the company.
- SmarterAnalyst•4 days ago
How Aurora Cannabis (ACB) Stock Gets to $11
While not bullish on Aurora Cannabis (ACB) long term, the stock could still reach $11 in the short term. The cannabis sector has several catalysts to push stocks higher before the oncoming flood of supply dips the market into oversupply in the next few years.Bullish CallMerrill Lynch analyst Christopher Carey came out with a bullish call on the leaders in the Canadian cannabis sector with global expansion hopes. The analyst placed a $52 price target on Canopy Growth (CGC) and an $11 price target on ACB.Following the bullish call, Aurora traded back to $9 providing a prediction of about 22% upside for the stock listed on the NYSE. The call isn’t really that bullish to warrant owning the high-risk in the sector long term, but investors should still consider the ability of Aurora to rally beyond $11 such as the all-time high just above $12.50.The company has a diluted share count that is marching towards 1.1 billion shares. The $11 price target places the market cap at a very aggressive $12.1 billion or C$16.2 billion.How the Target WorksAurora is aggressively pushing into the farming aspect of cannabis. The company recently announced plans to expand production to 625,000 kg from around 550,000 kg. The LatAm operations have aggressive plans as well that will push total production to top 1 million kg.The next big step for Aurora is for the June quarter to see supply reach 25,000 kg from only 7,822 kg in the December quarter. Whether the Canadian cannabis giant can maintain stable sales prices is crucial to making the following step in quarterly supply to in excess of 100,000 kg or a 15 fold increase from 2018 levels.Carey predicts that the Canadian market won’t reach cannabis oversupply until 2021. The stock can hit $11 anytime, but a delay in the oversupply outcome from sometime in 2019 or 2020 increases the odds of Aurora reaching new highs.In Q4, Aurora got just under C$7 per gram of cannabis sold. Assuming 500,000 kg sold at this price would provide an incredible C$3.5 billion in annual sales.Suddenly, the C$16.2 billion target market cap wouldn’t seem that expensive. Aurora would still have the additional production capacity coming online plus the LatAm operations.The easy path to $11 and even above $12 is the announcement of a major joint venture from the work with advisor Nelson Peltz. The deal might not even have to be all that material for the market to latch onto any catalyst for a CBD deal in the U.S. with a global beverage or consumer goods company. CBD-infused products such as beverages and edibles or even oils along with medical cannabis are expected to provide higher sales prices and profits.The long-term risk to these stories is a collapse in prices. A price dip in half to C$3 to C$4 per gram would still lead to substantial revenue growth. In such a scenario, one would have to worry about lower margins crimping profits. A lot of disgruntled investors might question why Aurora wildly built supply to push the market into an oversupply situation so quickly after legalization in Canada at the end of 2018.TakeawayThe key investor takeaway is that Aurora has several paths to easily reach $11 in the short term. The big key long term is whether cannabis prices remain stable as the company brings on a substantial increase in supply in the face of a strong illegal system that can avoid the regulator costs and taxes. Any hint of collapsing prices when end the rush to own the Canadian cannabis stocks.To read more on the nitty gritty of what’s going on in the rising cannabis industry, click here. Disclosure: The author has no position in ACB stock.Read more on ACB: * Aurora Cannabis (ACB) Stock Is in Position for Another Bullish Leg * Can Aurora Cannabis (ACB) Stock Hit Its Targets? * Aurora Cannabis (ACB) Stock: Flooding the Cannabis Market with More Supply More recent articles from Smarter Analyst: * MKM Continues to Recommend Micron (MU) Stock; Here's Why * Advanced Micro Devices (AMD) Stock Is Back in a Big Way * Cannabis Stock Canopy Growth (CGC) Could Race Above $60, but Caution Is Warranted * Jeff Bezos Is Leading Amazon (AMZN) in the Right Direction
- InvestorPlace•4 days ago
Why Aurora Cannabis Is Issuing So Much Stock and Debt
Aurora Cannabis (NYSE:ACB) is having a busy year raising its cash on hand. It filed a $750 million mixed shelf offering at the start of the month. In mid-January, it filed a $250 million aggregate principal amount of convertible senior notes due 2024. What is the company doing with all this money? And if markets continued to accumulate shares throughout the year, will the stock reward loyal holders? Higher Debt and Share DilutionThe convertible notes issuance and mixed shelf offering will no doubt give Aurora plenty of cash to grow the business. But the cost to existing shareholders is more debt and share dilution. Now, this could still pay off for Aurora and its shareholders if the company puts the cash to good use.InvestorPlace - Stock Market News, Stock Advice & Trading TipsAlso, its competitors either raised cash on the stock market or sold part of the company in return for a cash infusion. For example, Tilray (NASDAQ:TLRY) raised $435 million in October, while Canopy Growth (NYSE:CGC) got an investment from Constellation Brands (NYSE:STZ).Executive Chairman Michael Singer said:"Although we have no immediate intention of drawing capital against this Shelf Prospectus, we have introduced this option as a prudent and long-term strategic measure to provide us with flexibility in access to growth capital, if or when required, to continue executing on our global expansion and partnering strategy." Dilution Could Pay Off for ACB StockAurora is not diluting investors if the company signs deals that add value to the business. So far, Aurora bought companies but paid fair value for them. * 10 S&P 500 Stocks to Weather the Earnings Storm Last year in May 2018, it bought MedReleaf for CAD$3.2 billion in an all-share transaction. Or it expanded its facilities through higher capital expenses. More recently, on Apr. 10, Aurora expanded the size of its marijuana production facility in Medicine Hat, Alberta, by 33%.The acquisitions and production facility investments increase the company's scale. This, in turn, increases Aurora's growth potential. So as markets willingly bid cannabis stock higher, the high valuation in ACB stock works in the company's favor.It may use its own stock to scale up its business. This will allow it to catch up to Canopy. However, it needs to keep showing results. Previously, Tilray enjoyed a higher valuation but weak quarterly results posted in March sent the stock on a downtrend. TLRY stock is down 30% in the last month.Cannabis companies are racing to beef up their size, scale and growth rates. Only a few of them will reach a big enough scale to become global leaders in the industry. So, that small debt offering could allow Aurora to leverage its balance sheet to go after growth.A word of warning: short-term risks are high for investors here. Aurora and other cannabis companies are not making any profits yet, and revenue growth trails mounting costs, so always proceed with caution. Opportunities for Aurora CannabisAurora leads in medical market share in Europe and Latin America. It is active in 5 continents and 24 countries. On top of the 15 strategic acquisitions made since Aug. 2016, it completed or is undergoing 40 clinical studies. The studies involve over 71,000 medical patients.Production capacity is currently 100,000 kg per year (as at the end of Q2/2019). By early 2019, it forecasts production of 150,000 kg/year and then over 500,000 kg/year by mid-2020.The cash raised could accelerate Aurora's lead in the Canadian market. Quarterly revenue is growing nearly exponentially, while competitors trail by a wide margin. As long as registered medical patients grow and production increases, expect the pace of revenue growth to continue.Aurora's addressable market may expand as it targets the Canadian medical, global medical, Canadian adult-use, and global adult-use markets. So far, margins are stable for the Canadian markets and in the case of adult use, strengthened through premium and innovative products. Globally, Aurora needs to leverage its early mover advantage, spend on R&D to develop high margin products. Your TakeawayAurora has tremendous global market growth potential, but it will not happen overnight. Near-term, the company now has the cash resources to invest strategically. Its value chain will benefit from higher cultivation and the opening of more distribution outlets. Although shares are holding up now, expect volatility increasing after the company reports quarterly results on May 13.As of this writing, Chris Lau did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 5 Dividend Stocks Perfect for Retirees * 7 Reasons the Stock Market Rally Isn't Over Yet * 10 S&P 500 Stocks to Weather the Earnings Storm Compare Brokers The post Why Aurora Cannabis Is Issuing So Much Stock and Debt appeared first on InvestorPlace.
- Motley Fool•4 days ago
These 15 Pot Stocks Will Generate the Highest Sales in 2020
Surprise! Canopy Growth isn't No. 1 (or 2).
- CNW Group•4 days ago
Aurora Cannabis Provides Update On German Cannabis Production Tender
Aurora Cannabis Provides Update On German Cannabis Production Tender
