|Bid||7.52 x 29200|
|Ask||7.56 x 47300|
|Day's Range||7.36 - 7.71|
|52 Week Range||4.05 - 12.52|
|Beta (3Y Monthly)||2.87|
|PE Ratio (TTM)||35.00|
|Forward Dividend & Yield||N/A (N/A)|
|1y Target Est||N/A|
More American farmers are turning to hemp amid the low price of grain and the prolonged trade war between the United States and China. Yahoo Finance's Zack Guzman, Sibile Marcellus, and Heidi Chung discuss.
Actor & comedian Tommy Chong weighs in on CBD outlook. This coming as Texas legalizes hemp production. Yahoo Finance's Zack Guzman & Sibile Marcellus, along with 'BigEyedWish' founder Ian Wishingrad join in on the conversation.
Nationwide luxury cosmetics retailer, Bluemercury is celebrating 20 years in business. Yahoo Finance's Zack Guzman & Heidi Chung, along with Independent Women's Forum Nan Hayworth discuss with Bluemercury Co-Founder Barry Beck.
The House of Representatives is expected to pass a bill making it legal for marijuana companies to use banks in states where weed is legal. Former U.S. Securities and Exchange Commission Attorney Ron Geffner warns it may go up in smoke in the Senate. He talks to Yahoo Finance's Adam Shapiro, Julie Hyman, and Entrepreneur Magazine Editor Jason Feifer.
Canopy Growth Corp (NYSE:CGC) closed down 2.29% on Thursday, with CGC stock at $41.86 -- nearly one dollar lower than its Monday open after spiking over $44 on Tuesday. What caused the latest slide in CGC stock price? Besides the usual cannabis industry volatility (more on that shortly), the world's largest cannabis company announced on Thursday that it will release its Q4 results on June 20. And that comes just two days after the company's CFO gave an interview where he said his company will continue to lose money "for the foreseeable future."Source: Canopy Growth Why the Latest Slide in CGC Stock Price?In its Q3 earnings, Canopy Growth reported a surprise net income of $74.8 million CAD, however the company also posted an operating loss of over $157 million. It turned that loss into a positive only because of a change in the fair value of assets and liabilities -- which added over $233 million to its bottom line for the quarter. Naturally, CGC stock got a nice boost based on those results. * 7 First-Half IPO Stocks That Will Falter in 2019's Second Half In Q4, the company is expected to once again show an operating loss, but it won't have a repeat of last quarter's accounting boost. On the contrary, Canopy Growth's CFO told Bloomberg that CGC will likely be generating negative income "for the foreseeable future." The question there is whether the operating loss is shrinking -- showing a move toward eventual profitability -- or growing.InvestorPlace - Stock Market News, Stock Advice & Trading TipsRevenue is also something investors are nervous about. The Canadian recreational cannabis market has not taken off as quickly as expected. Marijuana sales dropped early in the year as the legalization excitement wore off, and unsold inventory built up. And just last week, Canopy Growth's Tweed cannabis retail operation was forced to lay off 12% of staff in the province of Manitoba in what it described as "growing pains."The dip in CGC stock reflects uncertainty about what is going to be seen in those Q4 (and full-year fiscal 2019) financial reports. CGC Stock Also Reflects Volatility in the Cannabis IndustryInvestors in CGC stock may be happy to see this week come to a close, however other cannabis stocks have also had a bumpy ride. In particular, Cronos Group Inc (NASDAQ:CRON) dropped 4.33% on Thursday, while Aurora Cannabis Inc (NYSE:ACB) repeated its pattern of last week, starting off up and then losing ground through the week (it dropped another 2.26% on Thursday). While this week has been up and down for CGC stock price, it reflects a 12-month period that's been a veritable roller coaster ride: below $25 last August to nearly $57 by October, dropping to the $27 range in December, back over $50 in January, topping $52 in April, and now just under $42.The overall theme is that the cannabis industry is still a relatively new one with recreational marijuana in particular in the early stages of growth.That means cannabis companies are still dealing with large expenditures as they open new production facilities. Retail outlets and supporting supply chain operations are still ramping up in most markets, and actual consumer demand for the product can be tough to judge accurately. Regulations can vary wildly in the different markets cannabis companies operate in, adding a high level of complexity to their business.In addition, many recreational marijuana producers are still perfecting methods for growing, harvesting, packaging and distribution.And then there's the hype surrounding the cannabis industry. It's not just the prospect of legalization in another state or even at the federal level that get's investors excited and buying up Canopy Growth stock. Headlines about cannabis products like CBD and its potential health benefits can cause big spikes in cannabis stocks as investors stampede to get in early. * 10 Stocks to Buy That Wall Street Expects to Soar for the Rest of 2019 All of these factors mean costs and revenue can vary significantly from quarter to quarter. And until the industry matures, CGC stock and other cannabis stocks are best for patient investors who are willing to wait and ride out the rocky weeks and wild swings.As of this writing, Brad Moon did not hold a position in any of the aforementioned securities. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * 10 Stocks to Buy That Wall Street Expects to Soar for the Rest of 2019 * 7 Value Stocks That Are Flying Under the Radar * 6 Mouth-Watering Fast Food Stocks for Growth Investors Compare Brokers The post CGC Stock Continues Week of Losses for Pot Stocks appeared first on InvestorPlace.
Cannabis stock traded broadly lower Friday, putting the sector on track for a fourth-straight loss, as Hexo Corp. shares extended losses toward a 3-month low in the wake of disappointing quarterly results. The ETFMG Alternative Harvest ETF dropped 2.1%, as 31 of 38 components sold off, and the Horizons U.S. Marijuana Index ETF shed 3.2%. The ETFMG ETF has now lost 5.2% over the past four sessions. Among the sector's more-active components, shares of Hexo Corp. dropped 4.1%, after losing 8.8% on Thursday, to put them on track for the lowest close since March 12. Elsewhere, shares of Aurora Cannabis Inc. inched up 0.1%, after losing 4.7% over the past three days; Cronos Group Inc. dropped 5.7%; Aphria Inc. shed 2.0%; and Canopy Growth Corp. declined 2.0%. The ETFMG ETF has now shed 15% over the past three months while the S&P 500 has gained 2.7%.
[Editor's note: This story was previously published in March 2019. It has since been updated and republished.]Often, when analysts or bloggers talk up the potential of marijuana stocks, the focus is on the consumer side of the industry. But some of the best stocks in the pot sector may be medical marijuana stocks.Indeed, it's on the medical side where growth likely is to be largest in the near term. Canada did legalize recreational marijuana in October, but investors promptly sold the news in response. U.S. legalization is likely to be a long slog. Attitudes are mixed in Europe -- but even in legalized markets anywhere, black market (and untaxed) operators will be able to take share.InvestorPlace - Stock Market News, Stock Advice & Trading TipsMeanwhile, approval of medical marijuana (in the U.S. and elsewhere) seems to be moving at a faster pace. In such a highly regulated market, black market and even smaller producers likely will be shut out. Quality and consistency will be key. Here, scale will matter. And those companies that win early have the best chance of becoming market leaders -- and providing big gains for investors. * 10 Stocks to Buy That Wall Street Expects to Soar for the Rest of 2019 As always -- and particularly in this space -- investors need to mind the risks and size positions accordingly. But for investors who see medical marijuana stocks as the next big thing, these three are the best stocks to buy for investors enamored with weed.Source: Shutterstock Charlotte's Web (CWBHF)Charlotte's Web (OTCMKTS:CWBHF) has become one of the leading players in CBD oil (cannabidiol). And though Charlotte's Web products are made from hemp -- at least for now -- instead of marijuana, the stock still looks like one of the best plays in the sector.InvestorPlace's Matt McCall named CWBHF (the stock also trades on the Canadian Securities Exchange, ticker CWEB) as his pick for our list of the best stocks for 2019. And the case makes some sense. CBD oil sales are soaring, and Charlotte's Web is a market leader. As McCall pointed out, the federal farm bill in the U.S. provided a catalyst by legalizing hemp.With so many customers yet to try CBD oil -- and so many existing users attached -- market growth should be huge. And while CWBHF isn't cheap from a valuation standpoint, its position as a market leader should allow it to grow into its valuation.Source: Shutterstock Cronos (CRON)Of late, marijuana producer Cronos Group (NASDAQ:CRON) has made the headlines for its consumer business. Most recently, tobacco giant Altria (NYSE:MO) invested some $1.8 billion in the company. The combination of Altria's advertising and distribution reach and Cronos' production capabilities would seem to be the best fit for the consumer side of the business.But investors can't ignore that Cronos is a medical marijuana stock as well. In fact, it's that business that drives the majority of its revenue at the moment. And it also has given the company a beachhead in multiple markets around the world, from its home market of Canada to Germany, Israel and Poland. * 10 Stocks to Buy That Wall Street Expects to Soar for the Rest of 2019 I wrote after the Altria deal that investors should stay patient with CRON stock. And in this market, that might still be wise advice.Source: Shutterstock CannTrust (CTST)CannTrust (NYSE:CTST) has been one of the biggest victims of the post-legalization selloff. The stock lost more than half its value and touched a 52-week low in the process last year. And it's been in an almost continuous slump again since March.Unlike many peers, the company usually posts gross profits. And its established leadership in the Canadian medical marijuana industry should drive consistent growth and allow CannTrust to stay profitable. There is some retail exposure here as well, but unlike peers, CannTrust seems to have room to drive upside on the medical side alone.CannTrust also was able to get a listing on the New York Stock Exchange this year. Admittedly, uplisting hasn't helped pot stocks in and of itself (most notably Aurora Cannabis (NYSE:ACB) took a lot longer to take off than was expected), but it certainly didn't hurt.From a profitability standpoint, at least, CNNTF seems like one of the best stocks in the pot sector. And with valuation near the lows, at least some of the risks here likely are priced in.As of this writing, Vince Martin has no positions in any securities mentioned. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * 10 Stocks to Buy That Wall Street Expects to Soar for the Rest of 2019 * 7 Value Stocks That Are Flying Under the Radar * 6 Mouth-Watering Fast Food Stocks for Growth Investors Compare Brokers The post 3 Medical Marijuana Stocks to Buy appeared first on InvestorPlace.
The fuel for this Southeast Asian country is its export economy and young workforce. But while it may steal some production from China in a trade war, a faltering global economy will hurt. And stocks are pricey.
The long-term prospects for Cronos Group (NASDAQ:CRON) stock look good. That is, if you ask CRON stock fans. There is almost no convincing them otherwise. Critics of Cronos Group stock and the whole industry can offer smartest arguments to prove that the cannabis stocks are headed for disaster, but it will all fall on deaf ears.Source: Shutterstock The bullish thesis for the industry is so vague and the scope is so widespread that it's almost impossible to kill it this year. It is a multi-headed beast where if the bears chop off one head, many others will stare them down with sharp teeth.Don't take my word for it, just consider the scoreboard. CRON is up 64% year-to-date -- leading the pot stock pack. The ETFMG Alternative Harvest ETF (NYSEARCA:MJ) is up only 30%. And I say this while I chuckle because that's still double the S&P 500 performance for the same period. So CRON is up four times more than the S&P.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 6 Growth Stocks That Could Be the Next Big Thing This is similar to how it was for Amazon (NASDAQ:AMZN) and Netflix (NASDAQ:NFLX) in their infancy stages. This is also very similar to the current situation with Beyond Meat (NASDAQ:BYND) and even Uber (NYSE:UBER). The bullish thesis for these types of pioneer stocks is too vague to try too short this early.This is not the same as saying that I drank the Kool-Aid think pot stocks will be as successful as AMZN long term. I am merely saying that it's too early to short them. Trading CRON StockSo do I go all in on CRON? No, but still this all depends on individual time frames and risk appetites. One thing is for sure, pot stocks make for great short-term trading vehicles so CRON has opportunities on both the upside and downside. Those who believe in it long term, this is as good as any to buy at least half their position. It is futile to wait for a perfect sign to enter.Mid term, I favor the upside potential through the rest of the year for CRON stock because it established a solid band of support. Since January of 2018, $14 per share played an important role. It served as a major pivot point, so it is an area where bulls and bears are consistently eager to fight it out hard.This creates congestion so it becomes a sticky zone. And since CRON stock price is above it, the bulls can use it as solid footing. Meaning onus is on the bears to break that. Otherwise, every dip towards it is a buying opportunity. Sustaining the selling then becomes almost impossible.So this leaves us with evaluating the upside potential at hand. Earlier I mentioned that there are shorter- term time frames to trade. Above $18 per share, CRON will invite momentum buyers to launch a $4 rally from there. There will be resistance near $20. This sounds like a wild statement, but it is doable for such a momentum stock.I also noted that the $14 per share zone is a long term pivot, but so is $16. Specifically for this year, it served as a major point of contention. So I expect $16 to be the immediate support. For those who like to sell credit put spreads to generate income, that would be a good short-term level to consider.Conversely, there is risk below especially due to trade uncertainties. So we are vulnerable to geopolitical headlines to cause sporadic selloffs. If Cronos stock fills the gap below and falls below $13.5 per share, it could trigger a $2 overshoot. While this is not my forecast, it is a scenario that exist below. The Bottom Line on Pot StocksIt is also important to note that I am not a super fan of the whole cannabis sector. But I do recognize that it's a tough short.This is a brand new industry to Wall Street, and marijuana still illegal at the federal level in the U.S. So it has everything going against it. Yet pot stocks still have so much support from everyone from retail investors to mega corporations. Constellation Brands (NYSE:STZ) and Altria (NYSE:MO) were the first two to dip their toes in the water by throwing billions at Canopy Growth (NYSE:CGC) and CRON so we know that they are the best leading cannabis companies.This is just the beginning.Dozens more companies are waiting and trying to figure out how they can also grab a piece of this pie. We all know about the popularity of recreational pot. But there are the slew of other applications that are extremely interesting. Mainly medicinal, edibles, and portables. There is a strong consensus that people will be drinking pot-infused drinks instead of soda, beer or wine. * 7 High-Quality Cheap Stocks to Buy With $10 I am not here to judge whether this is a realistic goal; it's definitely not in the very near term, but it's not out of the realm of possibilities. So the theoretical addressable market is literally incalculable. So what are the bears shorting? Without any negative headlines Cronos stock is going higher.Nicolas Chahine is the managing director of SellSpreads.com. As of this writing, he did not hold a position in any of the aforementioned securities. Join his live chat room free here. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * 7 High-Quality Cheap Stocks to Buy With $10 * 7 U.S. Stocks to Buy With Limited Trade War Exposure * 6 Growth Stocks That Could Be the Next Big Thing Compare Brokers The post Cronos Group Stock Is Just Getting Started appeared first on InvestorPlace.
Some investors have been raising concerns over the potential disruption of the cannabis market in general with low-cost pot produced in Latin America flooding the market, and in some cases, specifically with Aurora Cannabis (ACB) because of its market-leading production capacity, which could be undermined if it has no answer to the challenge of the industry being forced to compete on price alone, making marijuana nothing more than a commodity.Looking at it short and long term With the cannabis market where it stands today, there is nothing to be concerned about with low-cost pot competing with Canadian or U.S. producers, or Aurora Cannabis in particular.At this time there is very little trade going on between Canadian cannabis companies and foreign businesses, and in the U.S., it's illegal for cannabis to be imported. Neither of those are likely to change in the near future.Overall, the Latin America producers are focusing primarily on the Latin American and European markets, looking to, for the most part, to compete in the medical-grade cannabis oils segment of the market.Eventually that will without a doubt change as production capacity ramps up, and there will eventually be massive exports from Latin America to the North American markets.The good news there for Aurora Cannabis is it's one of the big players in Latin America via its acquisition of ICC Labs.ICC LabsWith the acquisition of ICC Labs, Aurora gained 70 percent market share in the market of Uruguay, which was the first country in the world to legalize recreational pot, and as important, its medical license in Columbia, where it can produce medical cannabis.Columbia is especially important because that's the country many investors are concerned about in regard to low-cost cannabis.As for the production capacity that comes with ICC Labs, when all its facilities are completed, it will be able to produce about 450,000 kilograms a year, or slightly under 1 million pounds. It is also thought it may be able to exceed that if market demand exceeds expectations.So when thinking in terms of Columbia or Latin America disrupting Aurora Cannabis, it has to be understood that the company is a disruptor, not the potentially disrupted.All that said, it's not probable that the main purpose of boosting capacity in Latin America is for the primary purpose of selling low-cost, low-margin pot. It may do so for a time in order to put downward pressure on competitors' margins and earnings, but I don't think it's going to sacrifice its own margins and earnings in the long term. There are a lot more profitable ways to use its product.Higher-priced productsFor some time Aurora Cannabis has clearly stated it considers itself a medical cannabis company. That doesn't mean it won't sell recreational pot, because it is and will continue to. It does mean that over time, it will gradually reduce recreational pot as a percentage of sales, or increase medical and wellness sales to the point they become a much higher percentage of its revenue. Either way, recreational pot will eventually become less important to the company.This is another reason why low-cost pot imports won't be a threat to its performance, beyond being one of the sources of the pot.For a time Aurora will need the revenue from recreational pot as it grows out its hemp, CBD and medical pot businesses, but once they take off, it'll focus on those higher priced products, rather than the commodity that recreational pot will become. There will be some branded exceptions on the recreational side, but as a whole, it will become a low-price commodity in the years ahead.This is why when you look at the various companies Aurora has acquired, they almost all focus on specialized products and cannabis strains that will generate wider margins and better earnings, even as demand for them continue to soar.ConclusionWith its low and high priced cannabis, it provides Aurora with a lot of flexibility to respond to changing market conditions.As it starts generating a lot more revenue over the next several quarters from its rapidly increasing production capacity, it will start to earning back the investment it put into its many growing facilities, making it likely the company will draw from some of its lower cost product from Latin America in order to boost margins and earnings even more.I think a number of companies producing cannabis in the U.S. and Canada will come under pressure because of low cost pot competing in those markets, but Aurora Cannabis is positioned to not be impacted much if at all, from the imports, because as mentioned, they will probably be one of the importers in the future.This is another of many reasons I see Aurora as being the top cannabis company today and into the future.To read more on the nitty gritty of what’s going on in the rising cannabis industry, click here. Disclosure: The author has a Long position in ACB.Read more on ACB: * Aurora Cannabis (ACB) Stock Gets Caution Flags * This Dip in Aurora Cannabis (ACB) Stock Is a Buying Opportunity * Quant Genius Jim Simons Jumps into Aurora Cannabis (ACB) Stock * Seaport Releases Updated Estimates for Aurora Cannabis More recent articles from Smarter Analyst: * Village Farms (VFF) Has a Lot Going for It * Hexo Has Difficult Days Ahead, Analyst Says * Square (SQ) Growth Slowing, But Evercore Remains Bullish on the Stock * This Analyst Sticks with His Buy Rating on Aphria (APHA) Stock, But Trims Price Target
Operating results for the largest pot stock in the world are due out next week -- here's what you need to know.
Cannabis investing emerged as a clear trend in the past year, with marijuana stocks accounting for a fifth of the 20 most-held stocks on the Robinhood app.
The cannabis sector traded mostly lower Tuesday, with the ETFMG Alternative Harvest ETF down 1.0% as 24 of 38 components traded lower. The Horizons Marijuana Life Sciences Index ETF dropped 1.4%, with 43 of 57 components falling. The declines come the ETFMG ETF gained 4.6% and the Horizons ETF advanced 5.5% over the past two sessions, while the S&P 500 tacked on 1.5%. Among some of the more-active pot stocks, Aurora Cannabis Inc. fell 2.6%, Canopy Growth Corp. shed 2.1%, Cronos Group Inc. gave up 2.5%, Tilray Inc. slumped 5.3% and Canopy Rivers Inc. lost 1.4%. The ETFMG ETF has now lost 10.3% over the past three months, while the S&P 500 has gained 3.7%.
Shares of Zynerba Pharmaceuticals (NASDAQ:ZYNE) are surging Tuesday after the company landed a patent for the treatment of autism spectrum disorder. Specifically, the patent covers treatment using cannabidiol, which will surely add a spark to ZYNE stock.Source: Zynerba PharmaceuticalsThe stock was up 8% in pre-market trading and there's potential for this name to run even further once investors catch wind of it. We're seeing that play out now, with shares up 18% in Tuesday morning trading.With a market capitalization just under $250 million, it's not a well-known player like Biogen (NASDAQ:BIIB) or Celgene (NASDAQ:CELG). In the same light, it's not even a well-known cannabis stock, like Canopy Growth (NYSE:CGC) or Aurora Cannabis (NYSE:ACB).InvestorPlace - Stock Market News, Stock Advice & Trading TipsZynerba was issued U.S. Patent No. 10,314,792, which is titled, "Treatment of Autism Spectrum Disorder with Cannabidiol" and runs through 2038. So if the treatment is successful, ZYNE stock will have the rights to this treatment for almost two decades. The PatentZynerba is building out a portfolio of different treatments based around its potential cannabidiol product Zygel. I say "potential" because there's still a lot of work and progress needed before this becomes a staple in the medicine cabinet, so to say. * 7 Dark Horse Stocks Winning the Race in 2019 The patented treatment "includes claims directed to methods of treating autism spectrum disorder by administering a therapeutically effective amount of synthetic cannabidiol." It was granted during the enrollment period of a Phase 2 BRIGHT study, which is intended to evaluate "the safety, tolerability and efficacy of Zygel for the treatment of children and adolescents with Autism Spectrum Disorder."Will it work? At this stage it's impossible to say, but there is promise. GW Pharmaceuticals (NASDAQ:GWPH) has successfully gained traction -- even here in the U.S. -- with its cannabidiol treatment for epileptic seizures. So if Zynerba can show similar successes with its treatment, it may open the door to other possible treatments in the future using its Zygel product. Trading ZYNE Stock Click to Enlarge The big boost in ZYNE stock comes as little surprise. After all, it's got all the right buzzwords working in its favor, even if the company has good intentions. Wall Street latches to these trends and investors aren't afraid to jump on board if they think there's opportunity. That's even as Phase-2 testing has yet to begin.ZYNE stock chart is one of only a few that could make a double-digit gain look fairly modest. Above you can see how it moved over downtrend resistance (blue line) on Monday. Now it's pushing through $13, as well as the 20-day moving average.Can this thing ignite through $14 and tag its 2019 high near $16.50? Yes, it can. There's no guarantee that it will, but these sort of momentum boosters can give a huge shot in the arm to small-cap stocks.Whether that justifies a move this powerful, ZYNE stock investors certainly have a reason to be excited. But there's a lot of room on the upside before Zynerba stock exhausts itself.On the downside, I want to see $11 to $11.50 hold as support.This marks the 50-day moving average (which is trending higher) as well as the 38.2% retracement. That said, it would be highly discouraging to see ZYNE stock lose all of Tuesday's gains. Bottom Line on ZYNE StockNorth of $13 and the 20-day would be best, but let's see how it trades throughout the day and the rest of this week.Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long CELG. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * 7 Dark Horse Stocks Winning the Race in 2019 * 6 Chinese Stocks to Sell That Are Suffering From a Digital Ad Slowdown * 4 Technology Stocks Blasting Higher Compare Brokers The post Zynerba Stock Soars on Cannabidiol Patent for Autism Spectrum Disorder appeared first on InvestorPlace.
By Departures CapitalAurora Cannabis (ACB) has been on an incredible ride the past few years. From humble beginnings into the second-largest Canadian cultivator by market cap, Aurora has really cemented itself in the cannabis sector as one of the major international players.With such low barriers of entry, the cannabis sector has seen hundreds of new companies pop up and try to claw away at companies like Aurora. Many of these companies are simply hoping they will get bought up for a pretty penny after everything is said and done.One major issue with cannabis is that it’s really hard to differentiate a product. This is especially hard when branding and marketing restriction severely hamper the building of brand value. Imagine how hard it was for companies like Nike or McDonalds to build their brand. Now imagine if they were restricted from doing any marketing or branding whatsoever. Many of these companies would cease to exist. But Aurora has really pushed through and created a brand that is now recognizable even with all the restrictions in place. With such a limited ability to differentiate, the only way forward is to differentiate by either price, innovation or by making headlines. And Aurora has been doing a little bit of everything.In order to differentiate itself, Aurora has been really pushing innovation and efficiency. Its ability to push the boundaries of cultivation technology has really made it an attractive investment. It simply gives it an edge over its competitors and allows its products to be higher quality and less costly to consumers. This is especially true when scaled to Aurora’s international level of production. Economies of scale play an integral part of Aurora’s strategy as well. In addition to being innovative and efficient, Aurora does it at a scale beyond any other. Like a well-oiled engine, Aurora is able to produce and distribute at a low cost and low footprint to any country at scale. This type of ability builds into its value proposition for investors and consumers.How does a company like Aurora push innovation? Well, it segments itself into every aspect of its value chain. Here are a few: retail distribution, home cultivation wholesale, high value-add product development, genetics research, facility engineering and more. All these things, although costly today, will make generate incredible long-term value. Any developments or new tech they patent will create competitive industry advantages for decades to come. Aurora is betting large on the long-term perspective of their business and it shows.Some important milestones in their innovation include a $115M investment to acquire the leading cannabis testing, genetics and R&D, Anandia Labs. These types of investments really build Aurora’s foundation as a global cannabis innovation leader. Aurora also took the step of increasing its genetics library with the acquisition of Whistler Medical for about $175 million. These are just a few drops in the bucket to the hundreds of millions it spends in-house developing their own tech.As the industry develops and adapts, companies able to produce products at a low cost efficiently and effectively will develop better value propositions for investors and consumers. Aurora is one of those companies leading the innovation charge.TipRanks’ data shows a bullish camp backing this cannabis titan. The ‘Strong Buy’ stock has amassed 6 ‘buy’ ratings in the last three months, with just one analyst playing it safe with a hold rating. The 12-month average price target stands at $9.27, marking nearly 20% in return potential for the stock.To read more on the nitty gritty of what’s going on in the rising cannabis industry, click here. Disclosure: The author is Long Aurora stockRead more on ACB: * Will Aurora Stock Be Impacted by Low-Cost Latin Competitors? * The Recent Dip in Aurora Stock Is a Buying Opportunity * Quant Genius Jim Simons Jumps into Aurora Cannabis Stock * Millennials and Cannabis Stocks, The Aurora (ACB) Love Story More recent articles from Smarter Analyst: * Village Farms (VFF) Has a Lot Going for It * Hexo Has Difficult Days Ahead, Analyst Says * Square (SQ) Growth Slowing, But Evercore Remains Bullish on the Stock * This Analyst Sticks with His Buy Rating on Aphria (APHA) Stock, But Trims Price Target
Despite the market's hearty rally last week wasn't a good one for Aurora Cannabis (NYSE:ACB) because Aurora stock is stuck in a technical downtrend.Source: Shutterstock Even as a number of stocks in the cannabis industry were bouncing higher as well, the recent underperformance vs. the overall market has investors wondering if Aurora is set to breakout or breakdown.Late last week, Stifel analysts initiated Aurora Cannabis stock with less-than-enthusiastic coverage. They slapped a hold rating and a C$10 price target on ACB ($7.47 USD). From current levels, that implies a slight downside but not much. At the very least, some investors may read that as a positive note. After all, it could have been a sell rating with a target that implied a big downside.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 7 Dark Horse Stocks Winning the Race in 2019 Still, it doesn't paint the most optimistic picture. The analysts argue that Aurora's "international medical-use growth opportunities are limited outside of Canada and Germany." They remain cautious as ACB due to execution concerns and the company's "lack of definitive strategy."So what do the charts say? Trading ACB Stock Click to EnlargeShares of Aurora stock are stuck in a tough downtrend (blue lines), with channel resistance squeezing it lower. Last month the 20-day and 50-day moving averages began acting as resistance, while Aurora is flirting with losing its 200-day moving average as well.Once ACB stock lost the $8.25 to $8.50 area last month, more selling pressure took hold. This area was resistance from October through March, but after turning to support it looked as if it would buoy the name going forward. Keep in mind, Aurora had just about doubled from the start of the year through mid-March.So what now?I'm watching a few key areas in the short term, starting with the 200-day. If this area turns from Q1 support to Q2 resistance, there will most likely be more downside to Aurora Cannabis stock. If ACB can reclaim this level, it will set up an important test with resistance. The only problem? Resistance sits between $8.10 and $8.60 and is trending lower. That's where investors will find the 20-day and 50-day moving averages, as well as channel resistance.Below the 200-day, and the 61.8% retracement at $7.29 will be an almost immediate focus. If it fails as to boost Aurora Cannabis, channel support will soon be called upon near $7.So is a breakout or breakdown coming for ACB stock? Until we first see how it handles some of these key levels, we won't have our answer, unfortunately. However, breaking out of this channel can trigger a big move in either direction. For that reason, these are must-watch zones for Aurora stock investors. Until they give way, ACB can remain channel bound. Bottom Line on Aurora StockI consider the cannabis space industry very interesting. On the one hand, it's moving impressively fast with regulation, public acceptance and corporate revenue. That's not to say there won't be bumps in the road, only that it's moving very quickly in the right direction. That said, despite this explosive growth, it's very much a long-term play. That's because the valuations are pretty large already.Take Aurora Cannabis for instance.ACB stock commands a market cap of almost $8 billion, while full-year estimates for fiscal 2019 revenue stand just under $200 million. That leaves Aurora trading at 40 times this year's revenue. Although on the more bullish side, estimates also call for $500 million in sales next year. That's a more palatable 16 times current sales but would also assume that the stock price stays flat over the next 12 months.So in a way, Stifel's coverage makes sense. The stock has upside provided a few things continue to play out. More states and countries need to continue down the regulatory approval path, while Aurora stock needs to execute on its opportunities. Lastly, it needs to show a path to profitability, while continuing its stunning revenue growth over the next few years.That really goes for more companies besides Aurora stock too. Almost all cannabis plays need to. That includes Canopy Growth (NYSE:CGC), Tilray (NASDAQ:TLRY), Aphria (NYSE:APHA), Cronos Group (NYSE:CRON), New Age Beverages (NASDAQ:NBEV) and others. Let's see if they can deliver.Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell did not hold a position in any of the aforementioned securities. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * 7 Dark Horse Stocks Winning the Race in 2019 * 6 Chinese Stocks to Sell That Are Suffering From a Digital Ad Slowdown * 4 Technology Stocks Blasting Higher Compare Brokers The post Here's What Needs to Happen for Aurora Stock to Break Out appeared first on InvestorPlace.
If you have doubts that cannabis is on its way from illegal to industrial, take a look inside Cresco Labs’ custom built, 43-thousand square-foot production facility in Joliet, Illinois.
At first glance, cannabis and cryptocurrencies seem to have a lot in common. Both comprise highly speculative markets subject to exuberant highs and crushing lows. The legality and regulation of each has languished in the gray. And to many mainstream investors, both have failed to shake synonymy with the black market.
Though the bulk of cannabis stock-mania to date has focused on Canopy Growth (NYSE:CGC), Tilray (NASDAQ:TLRY), Aurora Cannabis (NYSE:ACB) and Cronos Group (NASDAQ:CRON),arguably the most compelling pick in the bunch, Hexo (NYSEAMERICAN:HEXO), has been habitually overlooked.That's changing though, and for good reason. As marijuana-stock mania continues to mature and investors are willing and able to start judging these companies on their individual merits, they're finding HEXO is about as well-positioned for growth as any other name in the business. Although the Hexo stock price feels frothy now, this quiet name may be one of the better options for newcomers looking for exposure to marijuana stocks. * 7 Stocks to Buy As They Hit 52-Week Lows Bank of America's Christopher Carey agrees.InvestorPlace - Stock Market News, Stock Advice & Trading Tips What Makes HEXO Different?At first glance, it's easy to assume all marijuana stocks are the same.Take a closer look, though, and it becomes clear they're not. Aurora, for instance, has made it clear it's first and foremost hoping to make a meaningful shift into the medicinal market, and is steering clear of beverages. Canopy Growth has mastered its appeal to recreational users. Each name in the business, in fact, is now cultivating one or more niche.So what makes HEXO different? A couple of things.One of them, oddly enough, is geography.Though recreational cannabis is now legal everywhere in Canada, one of the proverbial epicenters of the movement has been Quebec, where HEXO sells roughly one-third of all cannabis bought. Its long-term supply contract should keep it positioned as the market leader there for the foreseeable future.The overarching difference between HEXO and its peers, however, is its plans to penetrate the still-budding edibles and beverage market, in the U.S. and Canada, along with its giant partner and its history of innovation.It's a tricky and unproven arena, one of the reasons Aurora Cannabis has no current plans to produce a beverage line. But HEXO will have plenty of competition in that market. Constellation Brands (NYSE:STZ) and Canopy Growth are teaming up on beverages, and New Age Beverages (NASDAQ:NBEV) has already launched a cannabis-infused line, using the brand name Marley (as in Bob Marley).HEXO has something of an ace up its sleeve on this front, though. It's already working with alcohol giant Molson Coors Brewing (NYSE:TAP) to bring beverages to the Canadian market, a market that may be worth on the order of $3 billion, before the end of the year.Though Constellation and Canopy will provide formidable competition, Molson thinks HEXO was the better partner. It would know, too. It held discussions with Aurora Cannabis and Aphria (NYSE:APHA) along with two other unnamed outfits, but Frederic Landtmeters, the CEO of Molson Coors Canada, ultimately concluded it was Hexo's "track record of innovation" that would make it the highest-potential partner.Then there's the detail investors have likely overlooked; Hexo is arguably better prepared to get a foothold in the growing U.S. market than most cannabis companies.Hexo USA was only officially launched a couple of weeks ago, but its CEO, Sebastien St. Louis, has already been in the United States for a while, speaking with investors, laying the groundwork for the company's future in the country.What that future has in store remains unclear, particularly given the fact that recreational cannabis and even medical marijuana remain illegal in much of the United States. But Oppenheimer analyst Rupesh Parikh noted in February, when he first started covering Hexo stock, that he expects HEXO to develop partnerships in non-beverage categories like cosmetics, edibles and vapes. That's important simply because, in the United States and Canada, consumers who are interested in trying cannabis for the first time are more likely to do so by eating or drinking it rather than smoking it.Others are already in the space, to be clear, but no cannabis company has yet entered into an edibles-oriented partnership from a major name. HEXO may be quietly mulling the industry's first such deal, if Parikh's instinct is on target. Looking Ahead for Hexo StockBank of America's Christopher Carey noted in April, "HEXO is our Top Pick in cannabis, screening compelling in our valuation framework vs peers (EV/sales and DCF), and with fundamentals grounded by the most de-risked cannabis supply in Canada (off-take with Quebec), an innovation-forward organization and potential for additional value-add partnerships (beyond that already developed with Molson Canada)."HEXO alluded to such value-added partnerships when Hexo USA was launched, bolstering comments already offered by Oppenheimer. And Molson has already noted how innovative the company has been.The assessments remain largely the same from one impartial observer to the next.Hexo stock may not be the absolute top pick in the cannabis space, as Carey suggests, but there's no denying HEXO is a marijuana stock that's been erroneously ignored.As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can learn more about James at his site, jamesbrumley.com, or follow him on Twitter, at @jbrumley. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * 7 Stocks to Buy As They Hit 52-Week Lows * 4 Antitrust Tech Stocks to Keep an Eye On * 5 Gold and Silver Stocks Touching Intraday Highs Compare Brokers The post Hexo Stock May Be the Cannabis Industry's Best-Kept Secret appeared first on InvestorPlace.
When it comes to the Canadian cannabis world, there are four big pot stocks that tend to hog the spotlight. That Big 4 includes Canopy Growth (NYSE:CGC), Aurora (NYSE:ACB), Tilray (NASDAQ:TLRY) and Cronos (NASDAQ:CRON). But those aren't the only four pot stocks playing in the Canadian cannabis market. Indeed, there are a handful of other pot stocks which, for various reasons, aren't followed as closely by Wall Street.Source: Shutterstock One such under-the-radar pot stock is Aphria (NYSE:APHA). For all intents and purposes, Aphria is just like Canopy, Aurora, Tilray and Cronos. The company is a Canadian cannabis producer which sells thousands of kilograms of cannabis into the legal Canadian market every quarter, and is looking to expand its reach into other countries, including the U.S. But, relative to the Big 4, APHA stock has a tiny market cap and is much, much cheaper on a fundamental basis.Does that mean APHA stock is the best pot stock to buy?InvestorPlace - Stock Market News, Stock Advice & Trading TipsNo. Far from it. Instead, Aphria stock is understandably smaller and cheaper than its peers. This company has a relatively small cannabis business. That cannabis business has reported tumultuous and shaky results over the past several months. The optics and news flow surrounding the company have been confusing, at best, and very worrisome, at worst. There's no big money investment. Nor is the balance sheet all that loaded up.In other words, there really isn't anything special about Aphria. Instead, there are few things which warrant concern.As a result, while APHA stock is cheaper than its peers, it is cheaper for a reason -- and that means investors are probably best served to wait on the sidelines until more clarity and stability are injected into this company's narrative and fundamentals. Cheapness Explained By Red FlagsOn its face, Aphria stock is considerably cheaper than any of the Big 4 pot stocks. * 7 Stocks to Buy As They Hit 52-Week Lows Canopy is the biggest player in this market, selling over 10,000 kilograms of cannabis last quarter. Aurora slots in at number two, with just under 10,000 kilograms of cannabis sold last quarter. Meanwhile, Tilray sold about 3,000 kilograms of cannabis. Aphria sold around 2,600 kilograms of cannabis. And Cronos is the smallest in this group, with just over 1,000 kilograms of cannabis sold last quarter.Given how much bigger they are, Canopy and Aurora reasonably have much larger market caps than Aphria. But, despite Aphria having a similarly sized cannabis business as Tilray and Cronos, APHA stock has a significantly lower market cap. TLRY stock has a $3.5 billion market cap. CRON stock is up above $5 billion. APHA stock is down near $1.5 billion.Indeed, on a market cap per kilogram of cannabis sold last quarter basis, Aphria stock is much cheaper than its peers. The median valuation across the Big 4? Roughly $1.3 million in market cap per kilogram of cannabis sold last quarter. Aphria stock's market cap per kilogram of cannabis sold last quarter? Below $650,000.But, this cheapness in APHA stock is easily explained by the company's tumultuous fundamentals and narrative.First, and foremost, Aphria's cannabis business actually declined in terms of both quarter-over-quarter revenue and volume last quarter, due to supply shortages. Second, there have been some notable C-suite departures which have created confusing turnover at the head of the company. Third, there was a hostile takeover offer that didn't pan out… and was very odd from the onset. Fourth, this company hasn't attracted any big-money interest or offers, despite its cheap valuation.Net net, there are reasons why APHA stock is cheaper than its peers, and those reasons should keep investors sidelined for the time being. No Need to Buy Aphria Stock YetMaybe the current cheapness in Aphria stock isn't warranted in the long run. Maybe the cannabis business will stabilize, all the external noise will pass, and the stock will roar higher.All this could happen. But, if it does happen, it will take several months to play out -- meaning there's no reason to buy in just yet while the story is still troubled.The first thing that needs to happen here is the cannabis business needs to stabilize. Next quarter's numbers need to represent growth from this quarter's numbers. Until that happens, investors likely won't buy in.The second thing that needs to happen is all the optical noise needs to pass. The C-suite needs to see some stabilization. Attacks against the company's credentials need to stop. The hangover from the hostile takeover bid needs to pass. * 10 Stocks to Buy That Could Be Takeover Targets If all that happens, then APHA stock will rally in a big way from here. But, until then, this stock will remain understandably cheaper than peers. Bottom Line on APHA StockPot stocks are inherently volatile, and APHA stock is volatile even for a pot stock. This volatility in the stock is the result of volatility in the company's fundamentals and narrative. So long as this fundamental and narrative volatility persists, investors will remain hesitant to buy into APHA.As of this writing, Luke Lango was long CGC and ACB. More From InvestorPlace * 4 Top American Penny Pot Stocks (Buy Before June 21) * 7 Stocks to Buy As They Hit 52-Week Lows * 4 Antitrust Tech Stocks to Keep an Eye On * 5 Gold and Silver Stocks Touching Intraday Highs Compare Brokers The post Aphria Is an Understandably Cheap Pot Stock appeared first on InvestorPlace.