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37500.0 | 2020-05-18 00:00:00 UTC | Stock Alert: Aurora Cannabis Surges 41% On Revenue Growth | ACB | https://www.nasdaq.com/articles/stock-alert%3A-aurora-cannabis-surges-41-on-revenue-growth-2020-05-18 | nan | nan | (RTTNews) - Shares of Aurora Cannabis Inc. (ACB) are gaining more than 41 percent or $4.63 in Monday's morning trade at $15.83 after the company reported strong revenue growth in the third quarter. The stock has traded in a range of $5.30 to $105.48 in the past 52 weeks.
Friday, the Canada-based cannabis company said its net revenue for the third quarter, excluding provisions of $2.9 million, rose 18 percent from the prior quarter to $78.4 million. Consumer cannabis net revenue, excluding provisions, increased 24 percent from the prior quarter to $41.5 million, reflecting the launch of Daily Special, Aurora's value brand, and a full quarter of Cannabis 2.0 products. Medical cannabis net revenue, both Canadian and international, showed growth of 13.5 percent overall.
Michael Singer, Executive Chairman and Interim CEO of Aurora said, "I am also pleased that our third quarter 2020 financial results were in-line with our expectations, and that we remain firmly on track with the cost-savings and capex goals we detailed during our business transformation plan in February 2020."
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | (RTTNews) - Shares of Aurora Cannabis Inc. (ACB) are gaining more than 41 percent or $4.63 in Monday's morning trade at $15.83 after the company reported strong revenue growth in the third quarter. Medical cannabis net revenue, both Canadian and international, showed growth of 13.5 percent overall. Michael Singer, Executive Chairman and Interim CEO of Aurora said, "I am also pleased that our third quarter 2020 financial results were in-line with our expectations, and that we remain firmly on track with the cost-savings and capex goals we detailed during our business transformation plan in February 2020." | (RTTNews) - Shares of Aurora Cannabis Inc. (ACB) are gaining more than 41 percent or $4.63 in Monday's morning trade at $15.83 after the company reported strong revenue growth in the third quarter. Friday, the Canada-based cannabis company said its net revenue for the third quarter, excluding provisions of $2.9 million, rose 18 percent from the prior quarter to $78.4 million. Consumer cannabis net revenue, excluding provisions, increased 24 percent from the prior quarter to $41.5 million, reflecting the launch of Daily Special, Aurora's value brand, and a full quarter of Cannabis 2.0 products. | (RTTNews) - Shares of Aurora Cannabis Inc. (ACB) are gaining more than 41 percent or $4.63 in Monday's morning trade at $15.83 after the company reported strong revenue growth in the third quarter. Friday, the Canada-based cannabis company said its net revenue for the third quarter, excluding provisions of $2.9 million, rose 18 percent from the prior quarter to $78.4 million. Consumer cannabis net revenue, excluding provisions, increased 24 percent from the prior quarter to $41.5 million, reflecting the launch of Daily Special, Aurora's value brand, and a full quarter of Cannabis 2.0 products. | (RTTNews) - Shares of Aurora Cannabis Inc. (ACB) are gaining more than 41 percent or $4.63 in Monday's morning trade at $15.83 after the company reported strong revenue growth in the third quarter. The stock has traded in a range of $5.30 to $105.48 in the past 52 weeks. Friday, the Canada-based cannabis company said its net revenue for the third quarter, excluding provisions of $2.9 million, rose 18 percent from the prior quarter to $78.4 million. |
37501.0 | 2020-05-18 00:00:00 UTC | Aurora Cannabis Stock Still Isn’t the Play | ACB | https://www.nasdaq.com/articles/aurora-cannabis-stock-still-isnt-the-play-2020-05-18 | nan | nan | InvestorPlace - Stock Market News, Stock Advice & Trading Tips
I’ll admit: I didn’t predict the post-earnings gain in Aurora Cannabis (NYSE:ACB). Few did. Aurora stock skyrocketed 68% last Friday after delivering fiscal third quarter earnings after the close on Thursday.
Source: Shutterstock
I’ll admit this, too: there’s some good news in the report. Sales were not just stronger than expected, but solid. Aurora is cutting costs and mid-term targets appear in sight.
But it’s worth adding a note of caution to the release. Aurora stock still is down almost 85% over the last year. It’s off some 40% from where it traded when I first tried to steer investors away back in February.
Looking forward, the core problems with Aurora stock persist. Margins are a question mark. The balance sheet is a mess. And I’m far from convinced that Aurora’s strategy is the right one.
20 Stocks to Buy If You’re Still Betting on America to Thrive
I believe wholeheartedly in the long-term opportunity in cannabis stocks. I have an entire service, Cannabis Cash Weekly, devoted to the sector. The declines that have faced cannabis stocks since early 2019 have gone too far.
But I argued after the second quarter report that ACB wasn’t the right play even for cannabis bulls. After the Q3 release, even with a 68% gain, I don’t feel much differently.
Good News From Earnings
The headline news from Aurora earnings is that the company got back to growth. Net revenue excluding provisions increased 18% quarter-over-quarter. For cannabis sales, growth was 15% q/q.
And the growth was broad-based. Consumer cannabis net revenue increased 24% from Q2. Management chalked that up to Daily Special, the company’s new value brand. Medical net sales worldwide rose 13.5%, again on a quarter-over-quarter basis.
That type of trajectory was not what analysts or investors were expecting. Net revenue of 75.5 million CAD absolutely crushed consensus projections.
Below the top line, Aurora seems to be delivering on its promises, a notable change from recent performance. For instance, the company aims to keep adjusted gross margins above 50%, and posted a 54% figure in Q3.
But the bigger move is in terms of SG&A (selling, general, and administrative) expenses. The figure was almost 100 million CAD in the second quarter; Aurora is targeting a significant reduction to just 40-45 million CAD.
And Aurora is getting there in a hurry. Q3 SG&A was 75.1 million CAD. On the third quarter conference call, interim chief executive officer Michael Singer said the company exited the quarter at a 60 million CAD run rate. That even includes research and development spending, which is now part of the 40-45 million CAD target.
As a result, Aurora reiterated its guidance for EBITDA profitability in the first quarter of 2021. That, plus strong sales growth, was enough to create Friday’s pop.
Taking a Step Back
But I’d urge investors to take a step back and consider some of the best stocks in recent years. There are names like Shopify (NYSE:SHOP), Tesla (NASDAQ:TSLA), and Amazon (NASDAQ:AMZN) on that list.
Those companies all benefited from growing markets. But those companies took advantage of that growth by aggressively attacking those markets and investing behind their businesses.
Even before the coronavirus hit, Shopify expected to earn less profit in 2020 than it did in 2019. Tesla could have ridden the Models S and X to profitability, but instead made a big bet on the Model 3. Amazon has never prioritized profitability over the customer experience.
Then, consider this statement from Aurora chief financial officer Glen Ibbott on the Q3 call:
We are, however, reaffirming our commitment to manage the business to positive EBITDA in Q1 2020 using whatever additional cost levers we need to…
This is not the time for any company, and particularly a cannabis company, to be focused solely on the near-term. There’s a massive opportunity worldwide. Smaller, weaker competitors are going to fall by the wayside.
But Aurora is focused just two quarters out, and focused solely on cutting costs. Again, SG&A spending is going to drop by more than half. R&D is getting cut as well.
Meanwhile, Canopy Growth (NYSE:CGC) and Cronos (NASDAQ:CRON) have no such problems. Thanks to multi-billion dollar investments from Constellation Brands (NYSE:STZ,NYSE:STZ.B) and Altria (NYSE:MO), those companies can be opportunistic as the industry resets. That’s a key reason why both stocks are part of Cannabis Cash Weekly.
The Balance Sheet Risk to Aurora Stock
To be fair, some of the reduction in SG&A spending is needed. As I’ve written before, Aurora’s past management was careless in terms of both Aurora’s cash and Aurora stock. Shareholders were diluted at an exponential clip as executives made acquisition after acquisition. Aurora overbuilt capacity, and spent far beyond its means.
But current shareholders still are paying for those past mistakes. Aurora isn’t slashing costs because Singer and Ibbott don’t know what they’re doing. It’s slashing costs because its debt is a ticking time bomb.
Aurora finished Q3 with nearly 600 million CAD in debt. It burned over 400 million CAD in cash in just the last two quarters.
Costs have to come down in a hurry — whether management thinks that’s a good idea or not. Meanwhile, Aurora is selling as much as $250 million in stock at the market to raise more capital. Those sales would further dilute shareholders and further depress the Aurora stock price.
That debt is why Aurora is in such a hurry to get to positive EBITDA. It’s running out of time. But positive EBITDA alone doesn’t support a market cap now well over $1 billion. It doesn’t even fix the debt problem.
And the near-term strategy will have a long-term cost. Lower marketing and R&D spending opens the door for rivals to take advantage.
So I’d advise investors to consider the context of the Q3 report. The short-term news is good. The long-term news is not. That suggests that the short-term rally in Aurora stock will end up being precisely that.
Matthew McCall left Wall Street to actually help investors — by getting them into the world’s biggest, most revolutionary trends BEFORE anyone else. The power of being “first” gave Matt’s readers the chance to bank +2,438% in Stamps.com (STMP), +1,523% in Ulta Beauty (ULTA) and +1,044% in Tesla (TSLA), just to name a few. Click here to see what Matt has up his sleeve now. Matt does not directly own the aforementioned securities.
The post Aurora Cannabis Stock Still Isn’t the Play appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips I’ll admit: I didn’t predict the post-earnings gain in Aurora Cannabis (NYSE:ACB). But I argued after the second quarter report that ACB wasn’t the right play even for cannabis bulls. Aurora stock skyrocketed 68% last Friday after delivering fiscal third quarter earnings after the close on Thursday. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips I’ll admit: I didn’t predict the post-earnings gain in Aurora Cannabis (NYSE:ACB). But I argued after the second quarter report that ACB wasn’t the right play even for cannabis bulls. On the third quarter conference call, interim chief executive officer Michael Singer said the company exited the quarter at a 60 million CAD run rate. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips I’ll admit: I didn’t predict the post-earnings gain in Aurora Cannabis (NYSE:ACB). But I argued after the second quarter report that ACB wasn’t the right play even for cannabis bulls. Then, consider this statement from Aurora chief financial officer Glen Ibbott on the Q3 call: We are, however, reaffirming our commitment to manage the business to positive EBITDA in Q1 2020 using whatever additional cost levers we need to… This is not the time for any company, and particularly a cannabis company, to be focused solely on the near-term. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips I’ll admit: I didn’t predict the post-earnings gain in Aurora Cannabis (NYSE:ACB). But I argued after the second quarter report that ACB wasn’t the right play even for cannabis bulls. Aurora stock still is down almost 85% over the last year. |
37502.0 | 2020-05-18 00:00:00 UTC | BUZZ-U.S. STOCKS ON THE MOVE-Centric Brands, Fulgent Genetics, Moderna | ACB | https://www.nasdaq.com/articles/buzz-u.s.-stocks-on-the-move-centric-brands-fulgent-genetics-moderna-2020-05-18-0 | nan | nan | Eikon search string for individual stock moves: STXBZ
The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi
The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh
U.S. stock indexes were set to open sharply higher on Monday on optimism fueled by encouraging data from a potential COVID-19 vaccine trial, with investors also counting on more stimulus to rescue the economy from a deep economic slump..N
At 8:58 ET, Dow e-minis 1YMc1 were up 3.25% at 24,281. S&P 500 e-minis ESc1 were up 2.91% at 2,929.25, while Nasdaq 100 e-minis NQc1 were up 2.03% at 9,281.25. The top three NYSE percentage gainers premarket .PRPG.NQ: ** Quintana Energy Services Inc , up 25% ** Chesapeake Energy Corp , up 24.2% ** Aurora Cannabis Inc , up 24.4% The top three NYSE percentage losers premarket .PRPL.NQ: ** M/I Homes Inc , down 18.8% ** GSX Techedu Inc , down 12.5% ** Select Asst Inc , down 11.8% The top three Nasdaq percentage gainers premarket .PRPG.O: ** Outlook Therapeutics Equity Warrants , up 229.7% ** Plus Therapeutics Equity Warrants , up 76.5% ** ALJ Regional Holdings Inc , up 46.5% The top three Nasdaq percentage losers premarket .PRPL.O: ** Centric Brands Inc , down 49% ** Pieris Pharmaceuticals Inc , down 22.1% ** Forescout Technologies Inc , down 20.4% ** JPMorgan Chase & Co JPM.N: up 3.9% premarket ** Citigroup Inc C.N: up 4.6% premarket ** Wells Fargo & Co WFC.N: up 5.1% premarket ** Bank of America Corp BAC.N: up 4.6% premarket ** Morgan Stanley MS.N: up 3.8% premarket ** Goldman Sachs Group Inc GS.N: up 3.4% premarket BUZZ-U.S. big banks: Shares rise as easing lockdowns soothe markets ** Bluebird bio Inc BLUE.O: down 2% premarket BUZZ-Drops on planned $400 mln stock offering ** Baker Hughes Co BKR.N: up 6.1% premarket ** Schlumberger NV SLB.N: up 5.8% premarket ** DMC Global Inc BOOM.O: up 3.7% premarket ** Oil States International Inc OIS.N: up 6.3% premarket Headline of story OR Buzz OR Brief USN ** Under Armour Inc UAA.N: up 6.4% premarket BUZZ-Appoints El-Erian as lead independent director, shares rise ** Deciphera Pharmaceuticals Inc DCPH.O: up 6.3% premarket BUZZ-Rises on U.S. FDA nod for stomach cancer drug ** Chembio Diagnostics Inc CEMI.O: up 8.7% premarket BUZZ-Rises after COVID-19 test distribution deal with Thermo Fisher ** Nutrien Ltd NTR.N: up 3.3% premarket BUZZ-Berenberg says Nutrien's earnings momentum may slow during H2 2020, cuts PT ** VistaGen Therapeutics Inc VTGN.O: up 16.8% premarket BUZZ-Up on submitting trial design to FDA for COVID-19 related anti-anxiety drug ** Centric Brands Inc CTRC.O: down 49% premarket BUZZ-Plunges as apparel maker files for bankruptcy ** Fulgent Genetics Inc FLGT.O: up 31.2% premarket BUZZ-Surges on U.S. FDA nod for emergency use of COVID-19 test kit ** Clovis Oncology Inc CLVS.O: up 3.2% premarket BUZZ-Rises on FDA approval of prostate cancer drug ** Best Buy Co Inc BBY.N: up 4.3% premarket BUZZ-TAG says Best Buy to emerge a retail winner, upgrades ** PG&E Corp PCG.N: up 4.6% premarket BUZZ-Rises after wildfire victims support reorganization plan[BUZZ-PG&E Corp rises after wildfire victims support reorganization plan] ** Teva Pharmaceutical TEVA.N: up 4.4% premarket BUZZ-Rises on China approval for Huntington's treatment ** Camping World Holdings Inc CWH.N: up 10% premarket BUZZ-Jumps on qtrly, special dividend ** Moderna Inc MRNA.O: up 34.7% premarket BUZZ-Surges after co's experimental COVID-19 vaccine shows promise ** Microsoft Corp MSFT.O: up 1.4% premarket
BUZZ-RBC says Microsoft's broad product portfolio to benefit from cloud business, hikes PT ** Lululemon Athletica Inc LULU.O: up 2.4% premarket
BUZZ-Best positioned to benefit from work-from-home trend - Brokerage
(Compiled by Amal S in Bengaluru)
((Amal.S@thomsonreuters.com; within U.S.+1 646 223 8780; outside U.S. +91 80 6749 3677;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Eikon search string for individual stock moves: STXBZ The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh U.S. stock indexes were set to open sharply higher on Monday on optimism fueled by encouraging data from a potential COVID-19 vaccine trial, with investors also counting on more stimulus to rescue the economy from a deep economic slump..N At 8:58 ET, Dow e-minis 1YMc1 were up 3.25% at 24,281. S&P 500 e-minis ESc1 were up 2.91% at 2,929.25, while Nasdaq 100 e-minis NQc1 were up 2.03% at 9,281.25. The top three NYSE percentage gainers premarket .PRPG.NQ: ** Quintana Energy Services Inc , up 25% ** Chesapeake Energy Corp , up 24.2% ** Aurora Cannabis Inc , up 24.4% The top three NYSE percentage losers premarket .PRPL.NQ: ** M/I Homes Inc , down 18.8% ** GSX Techedu Inc , down 12.5% ** Select Asst Inc , down 11.8% The top three Nasdaq percentage gainers premarket .PRPG.O: ** Outlook Therapeutics Equity Warrants , up 229.7% ** Plus Therapeutics Equity Warrants , up 76.5% ** ALJ Regional Holdings Inc , up 46.5% The top three Nasdaq percentage losers premarket .PRPL.O: ** Centric Brands Inc , down 49% ** Pieris Pharmaceuticals Inc , down 22.1% ** Forescout Technologies Inc , down 20.4% ** JPMorgan Chase & Co JPM.N: up 3.9% premarket ** Citigroup Inc C.N: up 4.6% premarket ** Wells Fargo & Co WFC.N: up 5.1% premarket ** Bank of America Corp BAC.N: up 4.6% premarket ** Morgan Stanley MS.N: up 3.8% premarket ** Goldman Sachs Group Inc GS.N: up 3.4% premarket BUZZ-U.S. big banks: Shares rise as easing lockdowns soothe markets ** Bluebird bio Inc BLUE.O: down 2% premarket BUZZ-Drops on planned $400 mln stock offering ** Baker Hughes Co BKR.N: up 6.1% premarket ** Schlumberger NV SLB.N: up 5.8% premarket ** DMC Global Inc BOOM.O: up 3.7% premarket ** Oil States International Inc OIS.N: up 6.3% premarket Headline of story OR Buzz OR Brief USN ** Under Armour Inc UAA.N: up 6.4% premarket BUZZ-Appoints El-Erian as lead independent director, shares rise ** Deciphera Pharmaceuticals Inc DCPH.O: up 6.3% premarket BUZZ-Rises on U.S. FDA nod for stomach cancer drug ** Chembio Diagnostics Inc CEMI.O: up 8.7% premarket BUZZ-Rises after COVID-19 test distribution deal with Thermo Fisher ** Nutrien Ltd NTR.N: up 3.3% premarket BUZZ-Berenberg says Nutrien's earnings momentum may slow during H2 2020, cuts PT ** VistaGen Therapeutics Inc VTGN.O: up 16.8% premarket BUZZ-Up on submitting trial design to FDA for COVID-19 related anti-anxiety drug ** Centric Brands Inc CTRC.O: down 49% premarket BUZZ-Plunges as apparel maker files for bankruptcy ** Fulgent Genetics Inc FLGT.O: up 31.2% premarket BUZZ-Surges on U.S. FDA nod for emergency use of COVID-19 test kit ** Clovis Oncology Inc CLVS.O: up 3.2% premarket BUZZ-Rises on FDA approval of prostate cancer drug ** Best Buy Co Inc BBY.N: up 4.3% premarket BUZZ-TAG says Best Buy to emerge a retail winner, upgrades ** PG&E Corp PCG.N: up 4.6% premarket BUZZ-Rises after wildfire victims support reorganization plan[BUZZ-PG&E Corp rises after wildfire victims support reorganization plan] ** Teva Pharmaceutical TEVA.N: up 4.4% premarket BUZZ-Rises on China approval for Huntington's treatment ** Camping World Holdings Inc CWH.N: up 10% premarket BUZZ-Jumps on qtrly, special dividend ** Moderna Inc MRNA.O: up 34.7% premarket BUZZ-Surges after co's experimental COVID-19 vaccine shows promise ** Microsoft Corp MSFT.O: up 1.4% premarket BUZZ-RBC says Microsoft's broad product portfolio to benefit from cloud business, hikes PT ** Lululemon Athletica Inc LULU.O: up 2.4% premarket BUZZ-Best positioned to benefit from work-from-home trend - Brokerage (Compiled by Amal S in Bengaluru) ((Amal.S@thomsonreuters.com; within U.S.+1 646 223 8780; outside U.S. +91 80 6749 3677;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Eikon search string for individual stock moves: STXBZ The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh U.S. stock indexes were set to open sharply higher on Monday on optimism fueled by encouraging data from a potential COVID-19 vaccine trial, with investors also counting on more stimulus to rescue the economy from a deep economic slump..N At 8:58 ET, Dow e-minis 1YMc1 were up 3.25% at 24,281. S&P 500 e-minis ESc1 were up 2.91% at 2,929.25, while Nasdaq 100 e-minis NQc1 were up 2.03% at 9,281.25. The top three NYSE percentage gainers premarket .PRPG.NQ: ** Quintana Energy Services Inc , up 25% ** Chesapeake Energy Corp , up 24.2% ** Aurora Cannabis Inc , up 24.4% The top three NYSE percentage losers premarket .PRPL.NQ: ** M/I Homes Inc , down 18.8% ** GSX Techedu Inc , down 12.5% ** Select Asst Inc , down 11.8% The top three Nasdaq percentage gainers premarket .PRPG.O: ** Outlook Therapeutics Equity Warrants , up 229.7% ** Plus Therapeutics Equity Warrants , up 76.5% ** ALJ Regional Holdings Inc , up 46.5% The top three Nasdaq percentage losers premarket .PRPL.O: ** Centric Brands Inc , down 49% ** Pieris Pharmaceuticals Inc , down 22.1% ** Forescout Technologies Inc , down 20.4% ** JPMorgan Chase & Co JPM.N: up 3.9% premarket ** Citigroup Inc C.N: up 4.6% premarket ** Wells Fargo & Co WFC.N: up 5.1% premarket ** Bank of America Corp BAC.N: up 4.6% premarket ** Morgan Stanley MS.N: up 3.8% premarket ** Goldman Sachs Group Inc GS.N: up 3.4% premarket BUZZ-U.S. big banks: Shares rise as easing lockdowns soothe markets ** Bluebird bio Inc BLUE.O: down 2% premarket BUZZ-Drops on planned $400 mln stock offering ** Baker Hughes Co BKR.N: up 6.1% premarket ** Schlumberger NV SLB.N: up 5.8% premarket ** DMC Global Inc BOOM.O: up 3.7% premarket ** Oil States International Inc OIS.N: up 6.3% premarket Headline of story OR Buzz OR Brief USN ** Under Armour Inc UAA.N: up 6.4% premarket BUZZ-Appoints El-Erian as lead independent director, shares rise ** Deciphera Pharmaceuticals Inc DCPH.O: up 6.3% premarket BUZZ-Rises on U.S. FDA nod for stomach cancer drug ** Chembio Diagnostics Inc CEMI.O: up 8.7% premarket BUZZ-Rises after COVID-19 test distribution deal with Thermo Fisher ** Nutrien Ltd NTR.N: up 3.3% premarket BUZZ-Berenberg says Nutrien's earnings momentum may slow during H2 2020, cuts PT ** VistaGen Therapeutics Inc VTGN.O: up 16.8% premarket BUZZ-Up on submitting trial design to FDA for COVID-19 related anti-anxiety drug ** Centric Brands Inc CTRC.O: down 49% premarket BUZZ-Plunges as apparel maker files for bankruptcy ** Fulgent Genetics Inc FLGT.O: up 31.2% premarket BUZZ-Surges on U.S. FDA nod for emergency use of COVID-19 test kit ** Clovis Oncology Inc CLVS.O: up 3.2% premarket BUZZ-Rises on FDA approval of prostate cancer drug ** Best Buy Co Inc BBY.N: up 4.3% premarket BUZZ-TAG says Best Buy to emerge a retail winner, upgrades ** PG&E Corp PCG.N: up 4.6% premarket BUZZ-Rises after wildfire victims support reorganization plan[BUZZ-PG&E Corp rises after wildfire victims support reorganization plan] ** Teva Pharmaceutical TEVA.N: up 4.4% premarket BUZZ-Rises on China approval for Huntington's treatment ** Camping World Holdings Inc CWH.N: up 10% premarket BUZZ-Jumps on qtrly, special dividend ** Moderna Inc MRNA.O: up 34.7% premarket BUZZ-Surges after co's experimental COVID-19 vaccine shows promise ** Microsoft Corp MSFT.O: up 1.4% premarket BUZZ-RBC says Microsoft's broad product portfolio to benefit from cloud business, hikes PT ** Lululemon Athletica Inc LULU.O: up 2.4% premarket BUZZ-Best positioned to benefit from work-from-home trend - Brokerage (Compiled by Amal S in Bengaluru) ((Amal.S@thomsonreuters.com; within U.S.+1 646 223 8780; outside U.S. +91 80 6749 3677;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Eikon search string for individual stock moves: STXBZ The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh U.S. stock indexes were set to open sharply higher on Monday on optimism fueled by encouraging data from a potential COVID-19 vaccine trial, with investors also counting on more stimulus to rescue the economy from a deep economic slump..N At 8:58 ET, Dow e-minis 1YMc1 were up 3.25% at 24,281. S&P 500 e-minis ESc1 were up 2.91% at 2,929.25, while Nasdaq 100 e-minis NQc1 were up 2.03% at 9,281.25. The top three NYSE percentage gainers premarket .PRPG.NQ: ** Quintana Energy Services Inc , up 25% ** Chesapeake Energy Corp , up 24.2% ** Aurora Cannabis Inc , up 24.4% The top three NYSE percentage losers premarket .PRPL.NQ: ** M/I Homes Inc , down 18.8% ** GSX Techedu Inc , down 12.5% ** Select Asst Inc , down 11.8% The top three Nasdaq percentage gainers premarket .PRPG.O: ** Outlook Therapeutics Equity Warrants , up 229.7% ** Plus Therapeutics Equity Warrants , up 76.5% ** ALJ Regional Holdings Inc , up 46.5% The top three Nasdaq percentage losers premarket .PRPL.O: ** Centric Brands Inc , down 49% ** Pieris Pharmaceuticals Inc , down 22.1% ** Forescout Technologies Inc , down 20.4% ** JPMorgan Chase & Co JPM.N: up 3.9% premarket ** Citigroup Inc C.N: up 4.6% premarket ** Wells Fargo & Co WFC.N: up 5.1% premarket ** Bank of America Corp BAC.N: up 4.6% premarket ** Morgan Stanley MS.N: up 3.8% premarket ** Goldman Sachs Group Inc GS.N: up 3.4% premarket BUZZ-U.S. big banks: Shares rise as easing lockdowns soothe markets ** Bluebird bio Inc BLUE.O: down 2% premarket BUZZ-Drops on planned $400 mln stock offering ** Baker Hughes Co BKR.N: up 6.1% premarket ** Schlumberger NV SLB.N: up 5.8% premarket ** DMC Global Inc BOOM.O: up 3.7% premarket ** Oil States International Inc OIS.N: up 6.3% premarket Headline of story OR Buzz OR Brief USN ** Under Armour Inc UAA.N: up 6.4% premarket BUZZ-Appoints El-Erian as lead independent director, shares rise ** Deciphera Pharmaceuticals Inc DCPH.O: up 6.3% premarket BUZZ-Rises on U.S. FDA nod for stomach cancer drug ** Chembio Diagnostics Inc CEMI.O: up 8.7% premarket BUZZ-Rises after COVID-19 test distribution deal with Thermo Fisher ** Nutrien Ltd NTR.N: up 3.3% premarket BUZZ-Berenberg says Nutrien's earnings momentum may slow during H2 2020, cuts PT ** VistaGen Therapeutics Inc VTGN.O: up 16.8% premarket BUZZ-Up on submitting trial design to FDA for COVID-19 related anti-anxiety drug ** Centric Brands Inc CTRC.O: down 49% premarket BUZZ-Plunges as apparel maker files for bankruptcy ** Fulgent Genetics Inc FLGT.O: up 31.2% premarket BUZZ-Surges on U.S. FDA nod for emergency use of COVID-19 test kit ** Clovis Oncology Inc CLVS.O: up 3.2% premarket BUZZ-Rises on FDA approval of prostate cancer drug ** Best Buy Co Inc BBY.N: up 4.3% premarket BUZZ-TAG says Best Buy to emerge a retail winner, upgrades ** PG&E Corp PCG.N: up 4.6% premarket BUZZ-Rises after wildfire victims support reorganization plan[BUZZ-PG&E Corp rises after wildfire victims support reorganization plan] ** Teva Pharmaceutical TEVA.N: up 4.4% premarket BUZZ-Rises on China approval for Huntington's treatment ** Camping World Holdings Inc CWH.N: up 10% premarket BUZZ-Jumps on qtrly, special dividend ** Moderna Inc MRNA.O: up 34.7% premarket BUZZ-Surges after co's experimental COVID-19 vaccine shows promise ** Microsoft Corp MSFT.O: up 1.4% premarket BUZZ-RBC says Microsoft's broad product portfolio to benefit from cloud business, hikes PT ** Lululemon Athletica Inc LULU.O: up 2.4% premarket BUZZ-Best positioned to benefit from work-from-home trend - Brokerage (Compiled by Amal S in Bengaluru) ((Amal.S@thomsonreuters.com; within U.S.+1 646 223 8780; outside U.S. +91 80 6749 3677;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Eikon search string for individual stock moves: STXBZ The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh U.S. stock indexes were set to open sharply higher on Monday on optimism fueled by encouraging data from a potential COVID-19 vaccine trial, with investors also counting on more stimulus to rescue the economy from a deep economic slump..N At 8:58 ET, Dow e-minis 1YMc1 were up 3.25% at 24,281. S&P 500 e-minis ESc1 were up 2.91% at 2,929.25, while Nasdaq 100 e-minis NQc1 were up 2.03% at 9,281.25. The top three NYSE percentage gainers premarket .PRPG.NQ: ** Quintana Energy Services Inc , up 25% ** Chesapeake Energy Corp , up 24.2% ** Aurora Cannabis Inc , up 24.4% The top three NYSE percentage losers premarket .PRPL.NQ: ** M/I Homes Inc , down 18.8% ** GSX Techedu Inc , down 12.5% ** Select Asst Inc , down 11.8% The top three Nasdaq percentage gainers premarket .PRPG.O: ** Outlook Therapeutics Equity Warrants , up 229.7% ** Plus Therapeutics Equity Warrants , up 76.5% ** ALJ Regional Holdings Inc , up 46.5% The top three Nasdaq percentage losers premarket .PRPL.O: ** Centric Brands Inc , down 49% ** Pieris Pharmaceuticals Inc , down 22.1% ** Forescout Technologies Inc , down 20.4% ** JPMorgan Chase & Co JPM.N: up 3.9% premarket ** Citigroup Inc C.N: up 4.6% premarket ** Wells Fargo & Co WFC.N: up 5.1% premarket ** Bank of America Corp BAC.N: up 4.6% premarket ** Morgan Stanley MS.N: up 3.8% premarket ** Goldman Sachs Group Inc GS.N: up 3.4% premarket BUZZ-U.S. big banks: Shares rise as easing lockdowns soothe markets ** Bluebird bio Inc BLUE.O: down 2% premarket BUZZ-Drops on planned $400 mln stock offering ** Baker Hughes Co BKR.N: up 6.1% premarket ** Schlumberger NV SLB.N: up 5.8% premarket ** DMC Global Inc BOOM.O: up 3.7% premarket ** Oil States International Inc OIS.N: up 6.3% premarket Headline of story OR Buzz OR Brief USN ** Under Armour Inc UAA.N: up 6.4% premarket BUZZ-Appoints El-Erian as lead independent director, shares rise ** Deciphera Pharmaceuticals Inc DCPH.O: up 6.3% premarket BUZZ-Rises on U.S. FDA nod for stomach cancer drug ** Chembio Diagnostics Inc CEMI.O: up 8.7% premarket BUZZ-Rises after COVID-19 test distribution deal with Thermo Fisher ** Nutrien Ltd NTR.N: up 3.3% premarket BUZZ-Berenberg says Nutrien's earnings momentum may slow during H2 2020, cuts PT ** VistaGen Therapeutics Inc VTGN.O: up 16.8% premarket BUZZ-Up on submitting trial design to FDA for COVID-19 related anti-anxiety drug ** Centric Brands Inc CTRC.O: down 49% premarket BUZZ-Plunges as apparel maker files for bankruptcy ** Fulgent Genetics Inc FLGT.O: up 31.2% premarket BUZZ-Surges on U.S. FDA nod for emergency use of COVID-19 test kit ** Clovis Oncology Inc CLVS.O: up 3.2% premarket BUZZ-Rises on FDA approval of prostate cancer drug ** Best Buy Co Inc BBY.N: up 4.3% premarket BUZZ-TAG says Best Buy to emerge a retail winner, upgrades ** PG&E Corp PCG.N: up 4.6% premarket BUZZ-Rises after wildfire victims support reorganization plan[BUZZ-PG&E Corp rises after wildfire victims support reorganization plan] ** Teva Pharmaceutical TEVA.N: up 4.4% premarket BUZZ-Rises on China approval for Huntington's treatment ** Camping World Holdings Inc CWH.N: up 10% premarket BUZZ-Jumps on qtrly, special dividend ** Moderna Inc MRNA.O: up 34.7% premarket BUZZ-Surges after co's experimental COVID-19 vaccine shows promise ** Microsoft Corp MSFT.O: up 1.4% premarket BUZZ-RBC says Microsoft's broad product portfolio to benefit from cloud business, hikes PT ** Lululemon Athletica Inc LULU.O: up 2.4% premarket BUZZ-Best positioned to benefit from work-from-home trend - Brokerage (Compiled by Amal S in Bengaluru) ((Amal.S@thomsonreuters.com; within U.S.+1 646 223 8780; outside U.S. +91 80 6749 3677;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. |
37503.0 | 2020-05-18 00:00:00 UTC | BUZZ-U.S. STOCKS ON THE MOVE-Oasis Midstream, L Brands, Diffusion Pharma | ACB | https://www.nasdaq.com/articles/buzz-u.s.-stocks-on-the-move-oasis-midstream-l-brands-diffusion-pharma-2020-05-18 | nan | nan | Eikon search string for individual stock moves: STXBZ
The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi
The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh
U.S. stocks surged on Monday, with the S&P 500 hitting a 10-week high, as encouraging early data from a potential coronavirus vaccine trial boosted sentiment, with investors also hoping for stimulus to cushion the economic blow from the pandemic..N
At 13:46 ET, the Dow Jones Industrial Average .DJI was up 3.74% at 24,572.32. The S&P 500 .SPX was up 3.23% at 2,956.13 and the Nasdaq Composite .IXIC was up 2.53% at 9,243.01. The top three S&P 500 .PG.INX percentage gainers: ** Norwegian Cruise Line Holdings Ltd , up 22.5% ** United Airlines Holdings Inc , up 20.1% ** Royal Caribbean Cruises Ltd , up 19.7% The top three S&P 500 .PL.INX percentage losers: ** Citrix Systems Inc , down 4.3% ** Campbell Soup Co , down 3.2 % ** Dominos Pizza , down 3% The top three NYSE .PG.N percentage gainers: ** Aurora Cannabis INc , up 58.6% ** Direxion Daily Mid Cap Bull 3x Shares , up 34.5% ** Direxion Daily S&P 500 High Beta Bull 3X Shares , up 28.8% The top three NYSE .PL.N percentage losers: ** DB Crude Oil Double Short ETN , down 41.2% ** Velocityshares 3X Inverse Natural Gas ETN , down 29.3% ** Direxion Daily S&P 500 High Beta Bear 3X Shares , down 28.4% The top three Nasdaq .PG.O percentage gainers: ** Oasis Midstream Partners LP , up 80.9% ** Vir Biotechnology Inc , up 30.7% ** Liberty Tripadvisor Holdings Inc , up 30.7% The top three Nasdaq .PL.O percentage losers: ** Forescout Technologies Inc , down 23.6% ** Repro-Med Systems, Inc , down 16% ** Aptevo Therapeutics Inc , down 14.1% ** Meritage Homes Corp MTH.N: up 12.3%
BUZZ-Jumps after positive May outlook ** Heron Therapeutics Inc HRTX.O: up 6.7%
BUZZ-Up after co starts study for pain drug ** Inspired Entertainment Inc INSE.O: up 11.8%
BUZZ-Eyes best day in May on higher quarterly revenue ** NuCana Plc NCNA.O: up 3.3%
BUZZ-Up after co resumes clinical studies halted for COVID-19 ** International Game Technology Plc IGT.N: up 11.4%
BUZZ-Up on profit beat at a time when COVID-19 wreaked gambling ** Oasis Midstream Partners LP OMP.O: up 80.9%
BUZZ-Soars on capex curbs, qtrly dividend ** L Brands Inc LB.N: up 18.0%
BUZZ-Surges as brokerages raise PTs ahead of first-quarter results ** Gilead Sciences Inc GILD.O: down 1.5%
BUZZ-Weakness in Gilead's stock an opportunity to buy - RBC ** Ford Motor Co F.N: up 8.2% ** General Motors Co GM.N: up 10.4% ** Fiat Chrysler Automobiles N.V. FCAU.N: up 8.7%
BUZZ-Ford, GM rise as U.S. auto industry shifts into gear after lockdown ** Apple Inc AAPL.O: up 2.4%
BUZZ-Gains on plans to reopen 25 more U.S. stores ** ForeScout Technologies Inc FSCT.O: down 23.6%
BUZZ-Falls after Advent cancels deal ** Diffusion Pharmaceuticals Inc DFFN.O: down 20.0%
BUZZ-Falls on direct stock offering ** Hertz Global Holdings Inc HTZ.N: up 18.4%
BUZZ-Rises after appointing new CEO ** NantKwest Inc NK.O: up 6.3%
BUZZ-Jumps as FDA clears IND application for COVID-19 treatment ** BioSig Technologies Inc BSGM.O: up 2.3%
BUZZ-Jumps as unit gets FDA nod for human trial of COVID-19 therapy ** Abbott Laboratories ABT.N: up 1.4% ** Baxter International Inc BAX.N: up 0.3% ** Johnson & Johnson JNJ.N: up 0.4% ** Edwards Lifesciences Corp EW.N: up 2.4% ** Stryker Corp SYK.N: up 6.5% ** Boston Scientific Corp BSX.N: up 4.6% ** Zimmer Biomet Holdings ZBH.N: up 9.9% ** Medtronic Plc MDT.N: up 5.8%
BUZZ-Rising elective surgeries in U.S positive for medtech sector - Credit Suisse ** Twin River Worldwide Holdings Inc TRWH.N: up 10.9%
BUZZ-Stifel says valuation grossly dislocated ** DraftKings Inc DKNG.O: up 2.9%
BUZZ-Surges as brokerages hike PTs after strong Q1 report ** JPMorgan Chase & Co JPM.N: up 4.6% ** Citigroup Inc C.N: up 8.1% ** Wells Fargo & Co WFC.N: up 8.2% ** Bank of America Corp BAC.N: up 6.3% ** Morgan Stanley MS.N: up 8.2% ** Goldman Sachs Group Inc GS.N: up 4.7% BUZZ-U.S. big banks rise on easing lockdowns, COVID-19 vaccine trial data ** Chevron Corp CVX.N: up 5.4% ** Exxon Mobil Corp XOM.N: up 7.4% ** Apache Corp APA.N: up 14.1% ** Devon Energy Corp DVN.N: up 10.6% ** Hess Corp HES.N: up 11.5% ** Occidental Petroleum Corp OXY.N: up 9.2% ** Cimarex Energy Co XEC.N: up 11.0% ** EOG Resources EOG.N: up 7.8% ** TechnipFMC Plc FTI.N: up 14.2% ** Helmerich and Payne Inc HP.N: up 8.6% ** ONEOK Inc OKE.N: up 9.1% ** Kinder Morgan Inc KMI.N: up 4.4% ** HollyFrontier Corp HFC.N: up 14.2% ** Marathon Petroleum Corp MPC.N: up 15.1% ** Phillips 66 PSX.N: up 8.2% ** Valero Energy Corp VLO.N: up 10.1% ** Schlumberger NV SLB.N: up 10.0% BUZZ-Oil stocks climb over easing restrictions, output curbs ** Under Armour Inc UAA.N: up 8.9% BUZZ-Appoints El-Erian as lead independent director, shares rise ** Deciphera Pharmaceuticals Inc DCPH.O: up 5.4% BUZZ-Rises on U.S. FDA nod for stomach cancer drug ** Chembio Diagnostics Inc CEMI.O: up 1.2% BUZZ-Rises after COVID-19 test distribution deal with Thermo Fisher ** VistaGen Therapeutics Inc VTGN.O: up 20.0% BUZZ-Up on submitting trial design to FDA for COVID-19 related anti-anxiety drug ** Centric Brands Inc CTRC.O: down 56.9% BUZZ-Plunges as apparel maker files for bankruptcy ** Fulgent Genetics Inc FLGT.O: up 4.3% BUZZ-Surges on U.S. FDA nod for emergency use of COVID-19 test kit ** Best Buy Co Inc BBY.N: up 10.5% BUZZ-TAG says Best Buy to emerge a retail winner, upgrades ** PG&E Corp PCG.N: up 7.1% BUZZ-Rises after wildfire victims support reorganization plan[BUZZ-PG&E Corp rises after wildfire victims support reorganization plan] ** Teva Pharmaceutical TEVA.N: up 4.4% BUZZ-Rises on China approval for Huntington's treatment ** Camping World Holdings Inc CWH.N: up 14.6% BUZZ-Jumps on qtrly, special dividend ** Moderna Inc MRNA.O: up 24.3% BUZZ-Moderna: Surges after co's experimental COVID-19 vaccine shows promise ** Microsoft Corp MSFT.O: up 1.4%
BUZZ-RBC says Microsoft's broad product portfolio to benefit from cloud business, hikes PT ** Lululemon Athletica Inc LULU.O: up 3.6%
BUZZ-Best positioned to benefit from work-from-home trend - Brokerage ** Workday Inc WDAY.O: down 1.2%
BUZZ-RBC sees dampening subscription growth for Workday, cuts PT
The 11 major S&P 500 sectors:
Communication Services
.SPLRCL
up 2.23%
Consumer Discretionary
.SPLRCD
up 3.38%
Consumer Staples
.SPLRCS
up 1.41%
Energy
.SPNY
up 7.22%
Financial
.SPSY
up 5.12%
Health
.SPXHC
up 1.39%
Industrial
.SPLRCI
up 6.36%
Information Technology
.SPLRCT
up 2.79%
Materials
.SPLRCM
up 4.63%
Real Estate
.SPLRCR
up 4.81%
Utilities
.SPLRCU
up 3.70%
(Compiled by Amal S in Bengaluru)
((Amal.S@thomsonreuters.com; within U.S.+1 646 223 8780; outside U.S. +91 80 6749 3677;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Eikon search string for individual stock moves: STXBZ The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh U.S. stocks surged on Monday, with the S&P 500 hitting a 10-week high, as encouraging early data from a potential coronavirus vaccine trial boosted sentiment, with investors also hoping for stimulus to cushion the economic blow from the pandemic..N At 13:46 ET, the Dow Jones Industrial Average .DJI was up 3.74% at 24,572.32. The top three S&P 500 .PG.INX percentage gainers: ** Norwegian Cruise Line Holdings Ltd , up 22.5% ** United Airlines Holdings Inc , up 20.1% ** Royal Caribbean Cruises Ltd , up 19.7% The top three S&P 500 .PL.INX percentage losers: ** Citrix Systems Inc , down 4.3% ** Campbell Soup Co , down 3.2 % ** Dominos Pizza , down 3% The top three NYSE .PG.N percentage gainers: ** Aurora Cannabis INc , up 58.6% ** Direxion Daily Mid Cap Bull 3x Shares , up 34.5% ** Direxion Daily S&P 500 High Beta Bull 3X Shares , up 28.8% The top three NYSE .PL.N percentage losers: ** DB Crude Oil Double Short ETN , down 41.2% ** Velocityshares 3X Inverse Natural Gas ETN , down 29.3% ** Direxion Daily S&P 500 High Beta Bear 3X Shares , down 28.4% The top three Nasdaq .PG.O percentage gainers: ** Oasis Midstream Partners LP , up 80.9% ** Vir Biotechnology Inc , up 30.7% ** Liberty Tripadvisor Holdings Inc , up 30.7% The top three Nasdaq .PL.O percentage losers: ** Forescout Technologies Inc , down 23.6% ** Repro-Med Systems, Inc , down 16% ** Aptevo Therapeutics Inc , down 14.1% ** Meritage Homes Corp MTH.N: up 12.3% BUZZ-Jumps after positive May outlook ** Heron Therapeutics Inc HRTX.O: up 6.7% BUZZ-Up after co starts study for pain drug ** Inspired Entertainment Inc INSE.O: up 11.8% BUZZ-Eyes best day in May on higher quarterly revenue ** NuCana Plc NCNA.O: up 3.3% BUZZ-Up after co resumes clinical studies halted for COVID-19 ** International Game Technology Plc IGT.N: up 11.4% BUZZ-Up on profit beat at a time when COVID-19 wreaked gambling ** Oasis Midstream Partners LP OMP.O: up 80.9% BUZZ-Soars on capex curbs, qtrly dividend ** L Brands Inc LB.N: up 18.0% BUZZ-Surges as brokerages raise PTs ahead of first-quarter results ** Gilead Sciences Inc GILD.O: down 1.5% BUZZ-Weakness in Gilead's stock an opportunity to buy - RBC ** Ford Motor Co F.N: up 8.2% ** General Motors Co GM.N: up 10.4% ** Fiat Chrysler Automobiles N.V. FCAU.N: up 8.7% BUZZ-Ford, GM rise as U.S. auto industry shifts into gear after lockdown ** Apple Inc AAPL.O: up 2.4% BUZZ-Gains on plans to reopen 25 more U.S. stores ** ForeScout Technologies Inc FSCT.O: down 23.6% BUZZ-Falls after Advent cancels deal ** Diffusion Pharmaceuticals Inc DFFN.O: down 20.0% BUZZ-Falls on direct stock offering ** Hertz Global Holdings Inc HTZ.N: up 18.4% BUZZ-Rises after appointing new CEO ** NantKwest Inc NK.O: up 6.3% BUZZ-Jumps as FDA clears IND application for COVID-19 treatment ** BioSig Technologies Inc BSGM.O: up 2.3% BUZZ-Jumps as unit gets FDA nod for human trial of COVID-19 therapy ** Abbott Laboratories ABT.N: up 1.4% ** Baxter International Inc BAX.N: up 0.3% ** Johnson & Johnson JNJ.N: up 0.4% ** Edwards Lifesciences Corp EW.N: up 2.4% ** Stryker Corp SYK.N: up 6.5% ** Boston Scientific Corp BSX.N: up 4.6% ** Zimmer Biomet Holdings ZBH.N: up 9.9% ** Medtronic Plc MDT.N: up 5.8% BUZZ-Rising elective surgeries in U.S positive for medtech sector - Credit Suisse ** Twin River Worldwide Holdings Inc TRWH.N: up 10.9% BUZZ-Stifel says valuation grossly dislocated ** DraftKings Inc DKNG.O: up 2.9% BUZZ-Surges as brokerages hike PTs after strong Q1 report ** JPMorgan Chase & Co JPM.N: up 4.6% ** Citigroup Inc C.N: up 8.1% ** Wells Fargo & Co WFC.N: up 8.2% ** Bank of America Corp BAC.N: up 6.3% ** Morgan Stanley MS.N: up 8.2% ** Goldman Sachs Group Inc GS.N: up 4.7% BUZZ-U.S. big banks rise on easing lockdowns, COVID-19 vaccine trial data ** Chevron Corp CVX.N: up 5.4% ** Exxon Mobil Corp XOM.N: up 7.4% ** Apache Corp APA.N: up 14.1% ** Devon Energy Corp DVN.N: up 10.6% ** Hess Corp HES.N: up 11.5% ** Occidental Petroleum Corp OXY.N: up 9.2% ** Cimarex Energy Co XEC.N: up 11.0% ** EOG Resources EOG.N: up 7.8% ** TechnipFMC Plc FTI.N: up 14.2% ** Helmerich and Payne Inc HP.N: up 8.6% ** ONEOK Inc OKE.N: up 9.1% ** Kinder Morgan Inc KMI.N: up 4.4% ** HollyFrontier Corp HFC.N: up 14.2% ** Marathon Petroleum Corp MPC.N: up 15.1% ** Phillips 66 PSX.N: up 8.2% ** Valero Energy Corp VLO.N: up 10.1% ** Schlumberger NV SLB.N: up 10.0% BUZZ-Oil stocks climb over easing restrictions, output curbs ** Under Armour Inc UAA.N: up 8.9% BUZZ-Appoints El-Erian as lead independent director, shares rise ** Deciphera Pharmaceuticals Inc DCPH.O: up 5.4% BUZZ-Rises on U.S. FDA nod for stomach cancer drug ** Chembio Diagnostics Inc CEMI.O: up 1.2% BUZZ-Rises after COVID-19 test distribution deal with Thermo Fisher ** VistaGen Therapeutics Inc VTGN.O: up 20.0% BUZZ-Up on submitting trial design to FDA for COVID-19 related anti-anxiety drug ** Centric Brands Inc CTRC.O: down 56.9% BUZZ-Plunges as apparel maker files for bankruptcy ** Fulgent Genetics Inc FLGT.O: up 4.3% BUZZ-Surges on U.S. FDA nod for emergency use of COVID-19 test kit ** Best Buy Co Inc BBY.N: up 10.5% BUZZ-TAG says Best Buy to emerge a retail winner, upgrades ** PG&E Corp PCG.N: up 7.1% BUZZ-Rises after wildfire victims support reorganization plan[BUZZ-PG&E Corp rises after wildfire victims support reorganization plan] ** Teva Pharmaceutical TEVA.N: up 4.4% BUZZ-Rises on China approval for Huntington's treatment ** Camping World Holdings Inc CWH.N: up 14.6% BUZZ-Jumps on qtrly, special dividend ** Moderna Inc MRNA.O: up 24.3% BUZZ-Moderna: Surges after co's experimental COVID-19 vaccine shows promise ** Microsoft Corp MSFT.O: up 1.4% BUZZ-RBC says Microsoft's broad product portfolio to benefit from cloud business, hikes PT ** Lululemon Athletica Inc LULU.O: up 3.6% BUZZ-Best positioned to benefit from work-from-home trend - Brokerage ** Workday Inc WDAY.O: down 1.2% BUZZ-RBC sees dampening subscription growth for Workday, cuts PT The 11 major S&P 500 sectors: Communication Services up 3.70% (Compiled by Amal S in Bengaluru) ((Amal.S@thomsonreuters.com; within U.S.+1 646 223 8780; outside U.S. +91 80 6749 3677;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Eikon search string for individual stock moves: STXBZ The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh U.S. stocks surged on Monday, with the S&P 500 hitting a 10-week high, as encouraging early data from a potential coronavirus vaccine trial boosted sentiment, with investors also hoping for stimulus to cushion the economic blow from the pandemic..N At 13:46 ET, the Dow Jones Industrial Average .DJI was up 3.74% at 24,572.32. The top three S&P 500 .PG.INX percentage gainers: ** Norwegian Cruise Line Holdings Ltd , up 22.5% ** United Airlines Holdings Inc , up 20.1% ** Royal Caribbean Cruises Ltd , up 19.7% The top three S&P 500 .PL.INX percentage losers: ** Citrix Systems Inc , down 4.3% ** Campbell Soup Co , down 3.2 % ** Dominos Pizza , down 3% The top three NYSE .PG.N percentage gainers: ** Aurora Cannabis INc , up 58.6% ** Direxion Daily Mid Cap Bull 3x Shares , up 34.5% ** Direxion Daily S&P 500 High Beta Bull 3X Shares , up 28.8% The top three NYSE .PL.N percentage losers: ** DB Crude Oil Double Short ETN , down 41.2% ** Velocityshares 3X Inverse Natural Gas ETN , down 29.3% ** Direxion Daily S&P 500 High Beta Bear 3X Shares , down 28.4% The top three Nasdaq .PG.O percentage gainers: ** Oasis Midstream Partners LP , up 80.9% ** Vir Biotechnology Inc , up 30.7% ** Liberty Tripadvisor Holdings Inc , up 30.7% The top three Nasdaq .PL.O percentage losers: ** Forescout Technologies Inc , down 23.6% ** Repro-Med Systems, Inc , down 16% ** Aptevo Therapeutics Inc , down 14.1% ** Meritage Homes Corp MTH.N: up 12.3% BUZZ-Jumps after positive May outlook ** Heron Therapeutics Inc HRTX.O: up 6.7% BUZZ-Up after co starts study for pain drug ** Inspired Entertainment Inc INSE.O: up 11.8% BUZZ-Eyes best day in May on higher quarterly revenue ** NuCana Plc NCNA.O: up 3.3% BUZZ-Up after co resumes clinical studies halted for COVID-19 ** International Game Technology Plc IGT.N: up 11.4% BUZZ-Up on profit beat at a time when COVID-19 wreaked gambling ** Oasis Midstream Partners LP OMP.O: up 80.9% BUZZ-Soars on capex curbs, qtrly dividend ** L Brands Inc LB.N: up 18.0% BUZZ-Surges as brokerages raise PTs ahead of first-quarter results ** Gilead Sciences Inc GILD.O: down 1.5% BUZZ-Weakness in Gilead's stock an opportunity to buy - RBC ** Ford Motor Co F.N: up 8.2% ** General Motors Co GM.N: up 10.4% ** Fiat Chrysler Automobiles N.V. FCAU.N: up 8.7% BUZZ-Ford, GM rise as U.S. auto industry shifts into gear after lockdown ** Apple Inc AAPL.O: up 2.4% BUZZ-Gains on plans to reopen 25 more U.S. stores ** ForeScout Technologies Inc FSCT.O: down 23.6% BUZZ-Falls after Advent cancels deal ** Diffusion Pharmaceuticals Inc DFFN.O: down 20.0% BUZZ-Falls on direct stock offering ** Hertz Global Holdings Inc HTZ.N: up 18.4% BUZZ-Rises after appointing new CEO ** NantKwest Inc NK.O: up 6.3% BUZZ-Jumps as FDA clears IND application for COVID-19 treatment ** BioSig Technologies Inc BSGM.O: up 2.3% BUZZ-Jumps as unit gets FDA nod for human trial of COVID-19 therapy ** Abbott Laboratories ABT.N: up 1.4% ** Baxter International Inc BAX.N: up 0.3% ** Johnson & Johnson JNJ.N: up 0.4% ** Edwards Lifesciences Corp EW.N: up 2.4% ** Stryker Corp SYK.N: up 6.5% ** Boston Scientific Corp BSX.N: up 4.6% ** Zimmer Biomet Holdings ZBH.N: up 9.9% ** Medtronic Plc MDT.N: up 5.8% BUZZ-Rising elective surgeries in U.S positive for medtech sector - Credit Suisse ** Twin River Worldwide Holdings Inc TRWH.N: up 10.9% BUZZ-Stifel says valuation grossly dislocated ** DraftKings Inc DKNG.O: up 2.9% BUZZ-Surges as brokerages hike PTs after strong Q1 report ** JPMorgan Chase & Co JPM.N: up 4.6% ** Citigroup Inc C.N: up 8.1% ** Wells Fargo & Co WFC.N: up 8.2% ** Bank of America Corp BAC.N: up 6.3% ** Morgan Stanley MS.N: up 8.2% ** Goldman Sachs Group Inc GS.N: up 4.7% BUZZ-U.S. big banks rise on easing lockdowns, COVID-19 vaccine trial data ** Chevron Corp CVX.N: up 5.4% ** Exxon Mobil Corp XOM.N: up 7.4% ** Apache Corp APA.N: up 14.1% ** Devon Energy Corp DVN.N: up 10.6% ** Hess Corp HES.N: up 11.5% ** Occidental Petroleum Corp OXY.N: up 9.2% ** Cimarex Energy Co XEC.N: up 11.0% ** EOG Resources EOG.N: up 7.8% ** TechnipFMC Plc FTI.N: up 14.2% ** Helmerich and Payne Inc HP.N: up 8.6% ** ONEOK Inc OKE.N: up 9.1% ** Kinder Morgan Inc KMI.N: up 4.4% ** HollyFrontier Corp HFC.N: up 14.2% ** Marathon Petroleum Corp MPC.N: up 15.1% ** Phillips 66 PSX.N: up 8.2% ** Valero Energy Corp VLO.N: up 10.1% ** Schlumberger NV SLB.N: up 10.0% BUZZ-Oil stocks climb over easing restrictions, output curbs ** Under Armour Inc UAA.N: up 8.9% BUZZ-Appoints El-Erian as lead independent director, shares rise ** Deciphera Pharmaceuticals Inc DCPH.O: up 5.4% BUZZ-Rises on U.S. FDA nod for stomach cancer drug ** Chembio Diagnostics Inc CEMI.O: up 1.2% BUZZ-Rises after COVID-19 test distribution deal with Thermo Fisher ** VistaGen Therapeutics Inc VTGN.O: up 20.0% BUZZ-Up on submitting trial design to FDA for COVID-19 related anti-anxiety drug ** Centric Brands Inc CTRC.O: down 56.9% BUZZ-Plunges as apparel maker files for bankruptcy ** Fulgent Genetics Inc FLGT.O: up 4.3% BUZZ-Surges on U.S. FDA nod for emergency use of COVID-19 test kit ** Best Buy Co Inc BBY.N: up 10.5% BUZZ-TAG says Best Buy to emerge a retail winner, upgrades ** PG&E Corp PCG.N: up 7.1% BUZZ-Rises after wildfire victims support reorganization plan[BUZZ-PG&E Corp rises after wildfire victims support reorganization plan] ** Teva Pharmaceutical TEVA.N: up 4.4% BUZZ-Rises on China approval for Huntington's treatment ** Camping World Holdings Inc CWH.N: up 14.6% BUZZ-Jumps on qtrly, special dividend ** Moderna Inc MRNA.O: up 24.3% BUZZ-Moderna: Surges after co's experimental COVID-19 vaccine shows promise ** Microsoft Corp MSFT.O: up 1.4% BUZZ-RBC says Microsoft's broad product portfolio to benefit from cloud business, hikes PT ** Lululemon Athletica Inc LULU.O: up 3.6% BUZZ-Best positioned to benefit from work-from-home trend - Brokerage ** Workday Inc WDAY.O: down 1.2% BUZZ-RBC sees dampening subscription growth for Workday, cuts PT The 11 major S&P 500 sectors: Communication Services up 3.70% (Compiled by Amal S in Bengaluru) ((Amal.S@thomsonreuters.com; within U.S.+1 646 223 8780; outside U.S. +91 80 6749 3677;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The top three S&P 500 .PG.INX percentage gainers: ** Norwegian Cruise Line Holdings Ltd , up 22.5% ** United Airlines Holdings Inc , up 20.1% ** Royal Caribbean Cruises Ltd , up 19.7% The top three S&P 500 .PL.INX percentage losers: ** Citrix Systems Inc , down 4.3% ** Campbell Soup Co , down 3.2 % ** Dominos Pizza , down 3% The top three NYSE .PG.N percentage gainers: ** Aurora Cannabis INc , up 58.6% ** Direxion Daily Mid Cap Bull 3x Shares , up 34.5% ** Direxion Daily S&P 500 High Beta Bull 3X Shares , up 28.8% The top three NYSE .PL.N percentage losers: ** DB Crude Oil Double Short ETN , down 41.2% ** Velocityshares 3X Inverse Natural Gas ETN , down 29.3% ** Direxion Daily S&P 500 High Beta Bear 3X Shares , down 28.4% The top three Nasdaq .PG.O percentage gainers: ** Oasis Midstream Partners LP , up 80.9% ** Vir Biotechnology Inc , up 30.7% ** Liberty Tripadvisor Holdings Inc , up 30.7% The top three Nasdaq .PL.O percentage losers: ** Forescout Technologies Inc , down 23.6% ** Repro-Med Systems, Inc , down 16% ** Aptevo Therapeutics Inc , down 14.1% ** Meritage Homes Corp MTH.N: up 12.3% BUZZ-Jumps after positive May outlook ** Heron Therapeutics Inc HRTX.O: up 6.7% BUZZ-Up after co starts study for pain drug ** Inspired Entertainment Inc INSE.O: up 11.8% BUZZ-Eyes best day in May on higher quarterly revenue ** NuCana Plc NCNA.O: up 3.3% BUZZ-Up after co resumes clinical studies halted for COVID-19 ** International Game Technology Plc IGT.N: up 11.4% BUZZ-Up on profit beat at a time when COVID-19 wreaked gambling ** Oasis Midstream Partners LP OMP.O: up 80.9% BUZZ-Soars on capex curbs, qtrly dividend ** L Brands Inc LB.N: up 18.0% BUZZ-Surges as brokerages raise PTs ahead of first-quarter results ** Gilead Sciences Inc GILD.O: down 1.5% BUZZ-Weakness in Gilead's stock an opportunity to buy - RBC ** Ford Motor Co F.N: up 8.2% ** General Motors Co GM.N: up 10.4% ** Fiat Chrysler Automobiles N.V. FCAU.N: up 8.7% BUZZ-Ford, GM rise as U.S. auto industry shifts into gear after lockdown ** Apple Inc AAPL.O: up 2.4% BUZZ-Gains on plans to reopen 25 more U.S. stores ** ForeScout Technologies Inc FSCT.O: down 23.6% BUZZ-Falls after Advent cancels deal ** Diffusion Pharmaceuticals Inc DFFN.O: down 20.0% BUZZ-Falls on direct stock offering ** Hertz Global Holdings Inc HTZ.N: up 18.4% BUZZ-Rises after appointing new CEO ** NantKwest Inc NK.O: up 6.3% BUZZ-Jumps as FDA clears IND application for COVID-19 treatment ** BioSig Technologies Inc BSGM.O: up 2.3% BUZZ-Jumps as unit gets FDA nod for human trial of COVID-19 therapy ** Abbott Laboratories ABT.N: up 1.4% ** Baxter International Inc BAX.N: up 0.3% ** Johnson & Johnson JNJ.N: up 0.4% ** Edwards Lifesciences Corp EW.N: up 2.4% ** Stryker Corp SYK.N: up 6.5% ** Boston Scientific Corp BSX.N: up 4.6% ** Zimmer Biomet Holdings ZBH.N: up 9.9% ** Medtronic Plc MDT.N: up 5.8% BUZZ-Rising elective surgeries in U.S positive for medtech sector - Credit Suisse ** Twin River Worldwide Holdings Inc TRWH.N: up 10.9% BUZZ-Stifel says valuation grossly dislocated ** DraftKings Inc DKNG.O: up 2.9% BUZZ-Surges as brokerages hike PTs after strong Q1 report ** JPMorgan Chase & Co JPM.N: up 4.6% ** Citigroup Inc C.N: up 8.1% ** Wells Fargo & Co WFC.N: up 8.2% ** Bank of America Corp BAC.N: up 6.3% ** Morgan Stanley MS.N: up 8.2% ** Goldman Sachs Group Inc GS.N: up 4.7% BUZZ-U.S. big banks rise on easing lockdowns, COVID-19 vaccine trial data ** Chevron Corp CVX.N: up 5.4% ** Exxon Mobil Corp XOM.N: up 7.4% ** Apache Corp APA.N: up 14.1% ** Devon Energy Corp DVN.N: up 10.6% ** Hess Corp HES.N: up 11.5% ** Occidental Petroleum Corp OXY.N: up 9.2% ** Cimarex Energy Co XEC.N: up 11.0% ** EOG Resources EOG.N: up 7.8% ** TechnipFMC Plc FTI.N: up 14.2% ** Helmerich and Payne Inc HP.N: up 8.6% ** ONEOK Inc OKE.N: up 9.1% ** Kinder Morgan Inc KMI.N: up 4.4% ** HollyFrontier Corp HFC.N: up 14.2% ** Marathon Petroleum Corp MPC.N: up 15.1% ** Phillips 66 PSX.N: up 8.2% ** Valero Energy Corp VLO.N: up 10.1% ** Schlumberger NV SLB.N: up 10.0% BUZZ-Oil stocks climb over easing restrictions, output curbs ** Under Armour Inc UAA.N: up 8.9% BUZZ-Appoints El-Erian as lead independent director, shares rise ** Deciphera Pharmaceuticals Inc DCPH.O: up 5.4% BUZZ-Rises on U.S. FDA nod for stomach cancer drug ** Chembio Diagnostics Inc CEMI.O: up 1.2% BUZZ-Rises after COVID-19 test distribution deal with Thermo Fisher ** VistaGen Therapeutics Inc VTGN.O: up 20.0% BUZZ-Up on submitting trial design to FDA for COVID-19 related anti-anxiety drug ** Centric Brands Inc CTRC.O: down 56.9% BUZZ-Plunges as apparel maker files for bankruptcy ** Fulgent Genetics Inc FLGT.O: up 4.3% BUZZ-Surges on U.S. FDA nod for emergency use of COVID-19 test kit ** Best Buy Co Inc BBY.N: up 10.5% BUZZ-TAG says Best Buy to emerge a retail winner, upgrades ** PG&E Corp PCG.N: up 7.1% BUZZ-Rises after wildfire victims support reorganization plan[BUZZ-PG&E Corp rises after wildfire victims support reorganization plan] ** Teva Pharmaceutical TEVA.N: up 4.4% BUZZ-Rises on China approval for Huntington's treatment ** Camping World Holdings Inc CWH.N: up 14.6% BUZZ-Jumps on qtrly, special dividend ** Moderna Inc MRNA.O: up 24.3% BUZZ-Moderna: Surges after co's experimental COVID-19 vaccine shows promise ** Microsoft Corp MSFT.O: up 1.4% BUZZ-RBC says Microsoft's broad product portfolio to benefit from cloud business, hikes PT ** Lululemon Athletica Inc LULU.O: up 3.6% BUZZ-Best positioned to benefit from work-from-home trend - Brokerage ** Workday Inc WDAY.O: down 1.2% BUZZ-RBC sees dampening subscription growth for Workday, cuts PT The 11 major S&P 500 sectors: Communication Services up 2.23% Consumer Discretionary up 3.38% Consumer Staples | Eikon search string for individual stock moves: STXBZ The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh U.S. stocks surged on Monday, with the S&P 500 hitting a 10-week high, as encouraging early data from a potential coronavirus vaccine trial boosted sentiment, with investors also hoping for stimulus to cushion the economic blow from the pandemic..N At 13:46 ET, the Dow Jones Industrial Average .DJI was up 3.74% at 24,572.32. The S&P 500 .SPX was up 3.23% at 2,956.13 and the Nasdaq Composite .IXIC was up 2.53% at 9,243.01. The top three S&P 500 .PG.INX percentage gainers: ** Norwegian Cruise Line Holdings Ltd , up 22.5% ** United Airlines Holdings Inc , up 20.1% ** Royal Caribbean Cruises Ltd , up 19.7% The top three S&P 500 .PL.INX percentage losers: ** Citrix Systems Inc , down 4.3% ** Campbell Soup Co , down 3.2 % ** Dominos Pizza , down 3% The top three NYSE .PG.N percentage gainers: ** Aurora Cannabis INc , up 58.6% ** Direxion Daily Mid Cap Bull 3x Shares , up 34.5% ** Direxion Daily S&P 500 High Beta Bull 3X Shares , up 28.8% The top three NYSE .PL.N percentage losers: ** DB Crude Oil Double Short ETN , down 41.2% ** Velocityshares 3X Inverse Natural Gas ETN , down 29.3% ** Direxion Daily S&P 500 High Beta Bear 3X Shares , down 28.4% The top three Nasdaq .PG.O percentage gainers: ** Oasis Midstream Partners LP , up 80.9% ** Vir Biotechnology Inc , up 30.7% ** Liberty Tripadvisor Holdings Inc , up 30.7% The top three Nasdaq .PL.O percentage losers: ** Forescout Technologies Inc , down 23.6% ** Repro-Med Systems, Inc , down 16% ** Aptevo Therapeutics Inc , down 14.1% ** Meritage Homes Corp MTH.N: up 12.3% BUZZ-Jumps after positive May outlook ** Heron Therapeutics Inc HRTX.O: up 6.7% BUZZ-Up after co starts study for pain drug ** Inspired Entertainment Inc INSE.O: up 11.8% BUZZ-Eyes best day in May on higher quarterly revenue ** NuCana Plc NCNA.O: up 3.3% BUZZ-Up after co resumes clinical studies halted for COVID-19 ** International Game Technology Plc IGT.N: up 11.4% BUZZ-Up on profit beat at a time when COVID-19 wreaked gambling ** Oasis Midstream Partners LP OMP.O: up 80.9% BUZZ-Soars on capex curbs, qtrly dividend ** L Brands Inc LB.N: up 18.0% BUZZ-Surges as brokerages raise PTs ahead of first-quarter results ** Gilead Sciences Inc GILD.O: down 1.5% BUZZ-Weakness in Gilead's stock an opportunity to buy - RBC ** Ford Motor Co F.N: up 8.2% ** General Motors Co GM.N: up 10.4% ** Fiat Chrysler Automobiles N.V. FCAU.N: up 8.7% BUZZ-Ford, GM rise as U.S. auto industry shifts into gear after lockdown ** Apple Inc AAPL.O: up 2.4% BUZZ-Gains on plans to reopen 25 more U.S. stores ** ForeScout Technologies Inc FSCT.O: down 23.6% BUZZ-Falls after Advent cancels deal ** Diffusion Pharmaceuticals Inc DFFN.O: down 20.0% BUZZ-Falls on direct stock offering ** Hertz Global Holdings Inc HTZ.N: up 18.4% BUZZ-Rises after appointing new CEO ** NantKwest Inc NK.O: up 6.3% BUZZ-Jumps as FDA clears IND application for COVID-19 treatment ** BioSig Technologies Inc BSGM.O: up 2.3% BUZZ-Jumps as unit gets FDA nod for human trial of COVID-19 therapy ** Abbott Laboratories ABT.N: up 1.4% ** Baxter International Inc BAX.N: up 0.3% ** Johnson & Johnson JNJ.N: up 0.4% ** Edwards Lifesciences Corp EW.N: up 2.4% ** Stryker Corp SYK.N: up 6.5% ** Boston Scientific Corp BSX.N: up 4.6% ** Zimmer Biomet Holdings ZBH.N: up 9.9% ** Medtronic Plc MDT.N: up 5.8% BUZZ-Rising elective surgeries in U.S positive for medtech sector - Credit Suisse ** Twin River Worldwide Holdings Inc TRWH.N: up 10.9% BUZZ-Stifel says valuation grossly dislocated ** DraftKings Inc DKNG.O: up 2.9% BUZZ-Surges as brokerages hike PTs after strong Q1 report ** JPMorgan Chase & Co JPM.N: up 4.6% ** Citigroup Inc C.N: up 8.1% ** Wells Fargo & Co WFC.N: up 8.2% ** Bank of America Corp BAC.N: up 6.3% ** Morgan Stanley MS.N: up 8.2% ** Goldman Sachs Group Inc GS.N: up 4.7% BUZZ-U.S. big banks rise on easing lockdowns, COVID-19 vaccine trial data ** Chevron Corp CVX.N: up 5.4% ** Exxon Mobil Corp XOM.N: up 7.4% ** Apache Corp APA.N: up 14.1% ** Devon Energy Corp DVN.N: up 10.6% ** Hess Corp HES.N: up 11.5% ** Occidental Petroleum Corp OXY.N: up 9.2% ** Cimarex Energy Co XEC.N: up 11.0% ** EOG Resources EOG.N: up 7.8% ** TechnipFMC Plc FTI.N: up 14.2% ** Helmerich and Payne Inc HP.N: up 8.6% ** ONEOK Inc OKE.N: up 9.1% ** Kinder Morgan Inc KMI.N: up 4.4% ** HollyFrontier Corp HFC.N: up 14.2% ** Marathon Petroleum Corp MPC.N: up 15.1% ** Phillips 66 PSX.N: up 8.2% ** Valero Energy Corp VLO.N: up 10.1% ** Schlumberger NV SLB.N: up 10.0% BUZZ-Oil stocks climb over easing restrictions, output curbs ** Under Armour Inc UAA.N: up 8.9% BUZZ-Appoints El-Erian as lead independent director, shares rise ** Deciphera Pharmaceuticals Inc DCPH.O: up 5.4% BUZZ-Rises on U.S. FDA nod for stomach cancer drug ** Chembio Diagnostics Inc CEMI.O: up 1.2% BUZZ-Rises after COVID-19 test distribution deal with Thermo Fisher ** VistaGen Therapeutics Inc VTGN.O: up 20.0% BUZZ-Up on submitting trial design to FDA for COVID-19 related anti-anxiety drug ** Centric Brands Inc CTRC.O: down 56.9% BUZZ-Plunges as apparel maker files for bankruptcy ** Fulgent Genetics Inc FLGT.O: up 4.3% BUZZ-Surges on U.S. FDA nod for emergency use of COVID-19 test kit ** Best Buy Co Inc BBY.N: up 10.5% BUZZ-TAG says Best Buy to emerge a retail winner, upgrades ** PG&E Corp PCG.N: up 7.1% BUZZ-Rises after wildfire victims support reorganization plan[BUZZ-PG&E Corp rises after wildfire victims support reorganization plan] ** Teva Pharmaceutical TEVA.N: up 4.4% BUZZ-Rises on China approval for Huntington's treatment ** Camping World Holdings Inc CWH.N: up 14.6% BUZZ-Jumps on qtrly, special dividend ** Moderna Inc MRNA.O: up 24.3% BUZZ-Moderna: Surges after co's experimental COVID-19 vaccine shows promise ** Microsoft Corp MSFT.O: up 1.4% BUZZ-RBC says Microsoft's broad product portfolio to benefit from cloud business, hikes PT ** Lululemon Athletica Inc LULU.O: up 3.6% BUZZ-Best positioned to benefit from work-from-home trend - Brokerage ** Workday Inc WDAY.O: down 1.2% BUZZ-RBC sees dampening subscription growth for Workday, cuts PT The 11 major S&P 500 sectors: Communication Services |
37504.0 | 2020-05-18 00:00:00 UTC | BUZZ-U.S. STOCKS ON THE MOVE-Centric Brands, Fulgent Genetics, Moderna | ACB | https://www.nasdaq.com/articles/buzz-u.s.-stocks-on-the-move-centric-brands-fulgent-genetics-moderna-2020-05-18 | nan | nan | Eikon search string for individual stock moves: STXBZ
The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi
The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh
U.S. stocks futures jumped on Monday after Moderna Inc MRNA.Osaid its experimental vaccine for COVID-19 showed promise in early trials and that it was looking to advance the vaccine into late-stage trials in July. .N
At 08:00 ET, Dow e-minis 1YMc1 were up 2.33% at 24,066. S&P 500 e-minis ESc1 were up 2.44% at 2,916, while Nasdaq 100 e-minis NQc1 were up 2.00% at 9,278.25. The top three NYSE percentage gainers premarket .PRPG.NQ: ** Hexo Corp , up 22.4% ** Aurora Cannabis Inc , up 22.5% ** Chesapeake Energy Corp , up 20.1% The top three NYSE percentage losers premarket .PRPL.NQ: ** StoneMor Inc , down 12.2% ** Select Asst Inc , down 11.8% ** Navistar International Corp <NAV.N>, down 10.5% The top three Nasdaq percentage gainers premarket .PRPG.O: ** Outlook Therapeutics Equity Warrants , up 229.7% ** ALJ Regional Holdings Inc , up 56.2% ** Plus Therapeutics Equity Warrants , up 47.1% The top three Nasdaq percentage losers premarket .PRPL.O: ** Centric Brands Inc , down 49.1% ** Cinedigm Corp , down 23.1% ** Pieris Pharmaceuticals Inc , down 22.1% ** Centric Brands Inc CTRC.O: down 49.1% premarket BUZZ-Plunges as apparel maker files for bankruptcy ** Fulgent Genetics Inc FLGT.O: up 27.7% premarket BUZZ-Surges on U.S. FDA nod for emergency use of COVID-19 test kit ** Clovis Oncology Inc CLVS.O: up 6.1% premarket BUZZ-Rises on FDA approval of prostate cancer drug ** Best Buy Co Inc BBY.N: up 2.5% premarket BUZZ-TAG says Best Buy to emerge a retail winner, upgrades ** PG&E Corp PCG.N: up 5.8% premarket BUZZ-Rises after wildfire victims support reorganization plan[BUZZ-PG&E Corp rises after wildfire victims support reorganization plan] ** Teva Pharmaceutical TEVA.N: up 3.6% premarket BUZZ-Rises on China approval for Huntington's treatment ** Camping World Holdings Inc CWH.N: up 9.8% premarket BUZZ-Jumps on qtrly, special dividend ** Moderna Inc MRNA.O: up 26.3% premarket BUZZ-Surges after co's experimental COVID-19 vaccine shows promise ** Microsoft Corp MSFT.O: up 1.7% premarket
BUZZ-RBC says Microsoft's broad product portfolio to benefit from cloud business, hikes PT ** Lululemon Athletica Inc LULU.O: up 2.0% premarket
BUZZ-Best positioned to benefit from work-from-home trend - Brokerage ** Workday Inc WDAY.O: up 1.4% premarket
BUZZ-RBC sees dampening subscription growth for Workday, cuts PT
(Compiled by Amal S in Bengaluru)
((Amal.S@thomsonreuters.com; within U.S.+1 646 223 8780; outside U.S. +91 80 6749 3677;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Eikon search string for individual stock moves: STXBZ The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh U.S. stocks futures jumped on Monday after Moderna Inc MRNA.Osaid its experimental vaccine for COVID-19 showed promise in early trials and that it was looking to advance the vaccine into late-stage trials in July. .N At 08:00 ET, Dow e-minis 1YMc1 were up 2.33% at 24,066. The top three NYSE percentage gainers premarket .PRPG.NQ: ** Hexo Corp , up 22.4% ** Aurora Cannabis Inc , up 22.5% ** Chesapeake Energy Corp , up 20.1% The top three NYSE percentage losers premarket .PRPL.NQ: ** StoneMor Inc , down 12.2% ** Select Asst Inc , down 11.8% ** Navistar International Corp <NAV.N>, down 10.5% The top three Nasdaq percentage gainers premarket .PRPG.O: ** Outlook Therapeutics Equity Warrants , up 229.7% ** ALJ Regional Holdings Inc , up 56.2% ** Plus Therapeutics Equity Warrants , up 47.1% The top three Nasdaq percentage losers premarket .PRPL.O: ** Centric Brands Inc , down 49.1% ** Cinedigm Corp , down 23.1% ** Pieris Pharmaceuticals Inc , down 22.1% ** Centric Brands Inc CTRC.O: down 49.1% premarket BUZZ-Plunges as apparel maker files for bankruptcy ** Fulgent Genetics Inc FLGT.O: up 27.7% premarket BUZZ-Surges on U.S. FDA nod for emergency use of COVID-19 test kit ** Clovis Oncology Inc CLVS.O: up 6.1% premarket BUZZ-Rises on FDA approval of prostate cancer drug ** Best Buy Co Inc BBY.N: up 2.5% premarket BUZZ-TAG says Best Buy to emerge a retail winner, upgrades ** PG&E Corp PCG.N: up 5.8% premarket BUZZ-Rises after wildfire victims support reorganization plan[BUZZ-PG&E Corp rises after wildfire victims support reorganization plan] ** Teva Pharmaceutical TEVA.N: up 3.6% premarket BUZZ-Rises on China approval for Huntington's treatment ** Camping World Holdings Inc CWH.N: up 9.8% premarket BUZZ-Jumps on qtrly, special dividend ** Moderna Inc MRNA.O: up 26.3% premarket BUZZ-Surges after co's experimental COVID-19 vaccine shows promise ** Microsoft Corp MSFT.O: up 1.7% premarket BUZZ-RBC says Microsoft's broad product portfolio to benefit from cloud business, hikes PT ** Lululemon Athletica Inc LULU.O: up 2.0% premarket BUZZ-Best positioned to benefit from work-from-home trend - Brokerage ** Workday Inc WDAY.O: up 1.4% premarket BUZZ-RBC sees dampening subscription growth for Workday, cuts PT (Compiled by Amal S in Bengaluru) ((Amal.S@thomsonreuters.com; within U.S.+1 646 223 8780; outside U.S. +91 80 6749 3677;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Eikon search string for individual stock moves: STXBZ The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh U.S. stocks futures jumped on Monday after Moderna Inc MRNA.Osaid its experimental vaccine for COVID-19 showed promise in early trials and that it was looking to advance the vaccine into late-stage trials in July. S&P 500 e-minis ESc1 were up 2.44% at 2,916, while Nasdaq 100 e-minis NQc1 were up 2.00% at 9,278.25. The top three NYSE percentage gainers premarket .PRPG.NQ: ** Hexo Corp , up 22.4% ** Aurora Cannabis Inc , up 22.5% ** Chesapeake Energy Corp , up 20.1% The top three NYSE percentage losers premarket .PRPL.NQ: ** StoneMor Inc , down 12.2% ** Select Asst Inc , down 11.8% ** Navistar International Corp <NAV.N>, down 10.5% The top three Nasdaq percentage gainers premarket .PRPG.O: ** Outlook Therapeutics Equity Warrants , up 229.7% ** ALJ Regional Holdings Inc , up 56.2% ** Plus Therapeutics Equity Warrants , up 47.1% The top three Nasdaq percentage losers premarket .PRPL.O: ** Centric Brands Inc , down 49.1% ** Cinedigm Corp , down 23.1% ** Pieris Pharmaceuticals Inc , down 22.1% ** Centric Brands Inc CTRC.O: down 49.1% premarket BUZZ-Plunges as apparel maker files for bankruptcy ** Fulgent Genetics Inc FLGT.O: up 27.7% premarket BUZZ-Surges on U.S. FDA nod for emergency use of COVID-19 test kit ** Clovis Oncology Inc CLVS.O: up 6.1% premarket BUZZ-Rises on FDA approval of prostate cancer drug ** Best Buy Co Inc BBY.N: up 2.5% premarket BUZZ-TAG says Best Buy to emerge a retail winner, upgrades ** PG&E Corp PCG.N: up 5.8% premarket BUZZ-Rises after wildfire victims support reorganization plan[BUZZ-PG&E Corp rises after wildfire victims support reorganization plan] ** Teva Pharmaceutical TEVA.N: up 3.6% premarket BUZZ-Rises on China approval for Huntington's treatment ** Camping World Holdings Inc CWH.N: up 9.8% premarket BUZZ-Jumps on qtrly, special dividend ** Moderna Inc MRNA.O: up 26.3% premarket BUZZ-Surges after co's experimental COVID-19 vaccine shows promise ** Microsoft Corp MSFT.O: up 1.7% premarket BUZZ-RBC says Microsoft's broad product portfolio to benefit from cloud business, hikes PT ** Lululemon Athletica Inc LULU.O: up 2.0% premarket BUZZ-Best positioned to benefit from work-from-home trend - Brokerage ** Workday Inc WDAY.O: up 1.4% premarket BUZZ-RBC sees dampening subscription growth for Workday, cuts PT (Compiled by Amal S in Bengaluru) ((Amal.S@thomsonreuters.com; within U.S.+1 646 223 8780; outside U.S. +91 80 6749 3677;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Eikon search string for individual stock moves: STXBZ The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh U.S. stocks futures jumped on Monday after Moderna Inc MRNA.Osaid its experimental vaccine for COVID-19 showed promise in early trials and that it was looking to advance the vaccine into late-stage trials in July. S&P 500 e-minis ESc1 were up 2.44% at 2,916, while Nasdaq 100 e-minis NQc1 were up 2.00% at 9,278.25. The top three NYSE percentage gainers premarket .PRPG.NQ: ** Hexo Corp , up 22.4% ** Aurora Cannabis Inc , up 22.5% ** Chesapeake Energy Corp , up 20.1% The top three NYSE percentage losers premarket .PRPL.NQ: ** StoneMor Inc , down 12.2% ** Select Asst Inc , down 11.8% ** Navistar International Corp <NAV.N>, down 10.5% The top three Nasdaq percentage gainers premarket .PRPG.O: ** Outlook Therapeutics Equity Warrants , up 229.7% ** ALJ Regional Holdings Inc , up 56.2% ** Plus Therapeutics Equity Warrants , up 47.1% The top three Nasdaq percentage losers premarket .PRPL.O: ** Centric Brands Inc , down 49.1% ** Cinedigm Corp , down 23.1% ** Pieris Pharmaceuticals Inc , down 22.1% ** Centric Brands Inc CTRC.O: down 49.1% premarket BUZZ-Plunges as apparel maker files for bankruptcy ** Fulgent Genetics Inc FLGT.O: up 27.7% premarket BUZZ-Surges on U.S. FDA nod for emergency use of COVID-19 test kit ** Clovis Oncology Inc CLVS.O: up 6.1% premarket BUZZ-Rises on FDA approval of prostate cancer drug ** Best Buy Co Inc BBY.N: up 2.5% premarket BUZZ-TAG says Best Buy to emerge a retail winner, upgrades ** PG&E Corp PCG.N: up 5.8% premarket BUZZ-Rises after wildfire victims support reorganization plan[BUZZ-PG&E Corp rises after wildfire victims support reorganization plan] ** Teva Pharmaceutical TEVA.N: up 3.6% premarket BUZZ-Rises on China approval for Huntington's treatment ** Camping World Holdings Inc CWH.N: up 9.8% premarket BUZZ-Jumps on qtrly, special dividend ** Moderna Inc MRNA.O: up 26.3% premarket BUZZ-Surges after co's experimental COVID-19 vaccine shows promise ** Microsoft Corp MSFT.O: up 1.7% premarket BUZZ-RBC says Microsoft's broad product portfolio to benefit from cloud business, hikes PT ** Lululemon Athletica Inc LULU.O: up 2.0% premarket BUZZ-Best positioned to benefit from work-from-home trend - Brokerage ** Workday Inc WDAY.O: up 1.4% premarket BUZZ-RBC sees dampening subscription growth for Workday, cuts PT (Compiled by Amal S in Bengaluru) ((Amal.S@thomsonreuters.com; within U.S.+1 646 223 8780; outside U.S. +91 80 6749 3677;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Eikon search string for individual stock moves: STXBZ The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh U.S. stocks futures jumped on Monday after Moderna Inc MRNA.Osaid its experimental vaccine for COVID-19 showed promise in early trials and that it was looking to advance the vaccine into late-stage trials in July. .N At 08:00 ET, Dow e-minis 1YMc1 were up 2.33% at 24,066. S&P 500 e-minis ESc1 were up 2.44% at 2,916, while Nasdaq 100 e-minis NQc1 were up 2.00% at 9,278.25. |
37505.0 | 2020-05-15 00:00:00 UTC | TSX gains as energy stocks rise on oil boost | ACB | https://www.nasdaq.com/articles/tsx-gains-as-energy-stocks-rise-on-oil-boost-2020-05-15 | nan | nan | May 15 (Reuters) - Canada's main stock index rose on Friday, lifted by energy stocks as oil prices hit a one-and-a-half-month high on signs of crude demand picking up.
* The energy sector .SPTTEN climbed 1.4% as U.S. crude CLc1 prices jumped 4.2% a barrel, while Brent crude LCOc1 added 2.3%. O/R
* Also helping the main index, the materials sector .GSPTTMT, which includes precious and base metals miners and fertilizer companies, gained 1.8% on higher gold prices.
* Gold prices hit a more than three-week high on Friday as rising U.S.-China trade tensions added to fears about the global economy already reeling from the coronavirus pandemic. GOL/
* At 9:42 a.m. ET (13:42 GMT), the Toronto Stock Exchange's S&P/TSX composite index .GSPTSE was up 39.1 points, or 0.27%, at 14,548.76.
* The Trump administration's move to block semiconductor shipments to China's Huawei Technologies raised fears of trade hostilities between the United States and China.
* The largest percentage gainer on the TSX was Aurora Cannabis Inc ACB.TO, which jumped 40.5%, after the company posted better-than-expected quarterly revenue.
* Its gains were followed ECN Capital Corp ECN.TO, which rose 12.1%, after the finance company reported first-quarter results.
* On the TSX, 121 issues were higher, while 106 issues declined for a 1.14-to-1 ratio favouring gainers, with 23.41 million shares traded.
* The luxury apparel maker Canada Goose Holdings Inc GOOS.TO fell 9%, the most on the TSX, after BofA Global Research downgraded its shares.
* The second biggest decliner was the oil producer Frontera Energy Corp FEC.TO, down 3.6%.
* The most heavily traded shares by volume were The TSX posted nine new 52-week highs and no new low.
* Across all Canadian issues there were 30 new 52-week highs and four new lows, with total volume of 47.46 million shares.
* * The most heavily traded shares by volume were pipeline operator Enbridge Inc ENB.TO and Aurora Cannabis Inc ACB.TO.
* The TSX posted nine new 52-week highs and no new low.
* Across all Canadian issues there were 30 new 52-week highs and four new lows, with total volume of 47.46 million shares.
(Reporting by Amal S in Bengaluru; Editing by Amy Caren Daniel)
((Amal.S@thomsonreuters.com; within U.S.+1 646 223 8780; outside U.S. +91 80 6749 3677;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | * The largest percentage gainer on the TSX was Aurora Cannabis Inc ACB.TO, which jumped 40.5%, after the company posted better-than-expected quarterly revenue. * * The most heavily traded shares by volume were pipeline operator Enbridge Inc ENB.TO and Aurora Cannabis Inc ACB.TO. O/R * Also helping the main index, the materials sector .GSPTTMT, which includes precious and base metals miners and fertilizer companies, gained 1.8% on higher gold prices. | * The largest percentage gainer on the TSX was Aurora Cannabis Inc ACB.TO, which jumped 40.5%, after the company posted better-than-expected quarterly revenue. * * The most heavily traded shares by volume were pipeline operator Enbridge Inc ENB.TO and Aurora Cannabis Inc ACB.TO. May 15 (Reuters) - Canada's main stock index rose on Friday, lifted by energy stocks as oil prices hit a one-and-a-half-month high on signs of crude demand picking up. | * The largest percentage gainer on the TSX was Aurora Cannabis Inc ACB.TO, which jumped 40.5%, after the company posted better-than-expected quarterly revenue. * * The most heavily traded shares by volume were pipeline operator Enbridge Inc ENB.TO and Aurora Cannabis Inc ACB.TO. May 15 (Reuters) - Canada's main stock index rose on Friday, lifted by energy stocks as oil prices hit a one-and-a-half-month high on signs of crude demand picking up. | * The largest percentage gainer on the TSX was Aurora Cannabis Inc ACB.TO, which jumped 40.5%, after the company posted better-than-expected quarterly revenue. * * The most heavily traded shares by volume were pipeline operator Enbridge Inc ENB.TO and Aurora Cannabis Inc ACB.TO. May 15 (Reuters) - Canada's main stock index rose on Friday, lifted by energy stocks as oil prices hit a one-and-a-half-month high on signs of crude demand picking up. |
37506.0 | 2020-05-15 00:00:00 UTC | Stock Alert: Aurora Cannabis Jumps 40% On Higher Revenue | ACB | https://www.nasdaq.com/articles/stock-alert%3A-aurora-cannabis-jumps-40-on-higher-revenue-2020-05-15 | nan | nan | (RTTNews) - Shares of Aurora Cannabis Inc. (ACB) are surging more than 40% Friday morning on the back of better-than-expected third-quarter revenue.
Revenue for the quarter increased 18% year-over-year at C$78.4 million. The company that serves both medical and consumer markets has achieved revenue growth in both the markets.
Michael Singer, Executive Chairman and Interim CEO of Aurora stated, "I am incredibly proud of the Aurora team for working through these challenging times in order to maintain uninterrupted operations at all of our production facilities and ensure we continue to meet the needs of our patients and consumers. I am also pleased that our third quarter 2020 financial results were in-line with our expectations, and that we remain firmly on track with the cost-savings and capex goals we detailed during our business transformation plan in February 2020."
Aurora Cannabis stock is currently trading at $9.38. It has traded in the range of $108.60- $0.66 in the last 52 weeks
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | (RTTNews) - Shares of Aurora Cannabis Inc. (ACB) are surging more than 40% Friday morning on the back of better-than-expected third-quarter revenue. Michael Singer, Executive Chairman and Interim CEO of Aurora stated, "I am incredibly proud of the Aurora team for working through these challenging times in order to maintain uninterrupted operations at all of our production facilities and ensure we continue to meet the needs of our patients and consumers. I am also pleased that our third quarter 2020 financial results were in-line with our expectations, and that we remain firmly on track with the cost-savings and capex goals we detailed during our business transformation plan in February 2020." | (RTTNews) - Shares of Aurora Cannabis Inc. (ACB) are surging more than 40% Friday morning on the back of better-than-expected third-quarter revenue. The company that serves both medical and consumer markets has achieved revenue growth in both the markets. Aurora Cannabis stock is currently trading at $9.38. | (RTTNews) - Shares of Aurora Cannabis Inc. (ACB) are surging more than 40% Friday morning on the back of better-than-expected third-quarter revenue. Michael Singer, Executive Chairman and Interim CEO of Aurora stated, "I am incredibly proud of the Aurora team for working through these challenging times in order to maintain uninterrupted operations at all of our production facilities and ensure we continue to meet the needs of our patients and consumers. I am also pleased that our third quarter 2020 financial results were in-line with our expectations, and that we remain firmly on track with the cost-savings and capex goals we detailed during our business transformation plan in February 2020." | (RTTNews) - Shares of Aurora Cannabis Inc. (ACB) are surging more than 40% Friday morning on the back of better-than-expected third-quarter revenue. Revenue for the quarter increased 18% year-over-year at C$78.4 million. The company that serves both medical and consumer markets has achieved revenue growth in both the markets. |
37507.0 | 2020-05-15 00:00:00 UTC | 4 Top Stock Trades for Monday: GE, NVDA, ACB, M | ACB | https://www.nasdaq.com/articles/4-top-stock-trades-for-monday%3A-ge-nvda-acb-m-2020-05-15 | nan | nan | InvestorPlace - Stock Market News, Stock Advice & Trading Tips
After starting off lower on the day, equities made a nice push into the green on Friday. With that in mind, let’s look at a few top stock trades for next week.
Top Stock Trades for Monday No. 1: General Electric (GE)
Click to Enlarge
General Electric (NYSE:GE) looks bad, doesn’t it? I mean, this says all you need to know right here: While the S&P 500 has rebounded tremendously from the March lows, GE stock is breaking to new lows this week.
Shares lost the critical $6 mark earlier this week, as the 20-day moving average and downtrend resistance squeezed shares below this key support mark. Now, it’s clinging to $5.50 like it’s life depends on it.
A move below puts $5 on the table. On a rebound, bulls need to see shares reclaim $6, as well as the 20-day moving average and downtrend resistance. Above puts the 50-day moving average in play.
20 Stocks to Buy If You’re Still Betting on America to Thrive
But truthfully, there’s a lot of good-looking stocks out there — why not play one of those instead?
Top Stock Trades for Monday No. 2: Nvidia (NVDA)
NVDA)" width="300" height="270">
Click to Enlarge
Speaking of good-looking stocks, how about Nvidia (NASDAQ:NVDA) stock? Shares hit new all-time highs on Friday, as bulls bid it up into next Thursday’s earnings report.
Should shares continue higher, $340-plus isn’t out of the picture, but it’s hard to get really bullish on this one after such a strong move.
On a pullback, the rising 20-day moving average and uptrend support near $300 should buoy the stock. A larger dip likely puts the $270 area back in play, where NVDA will find its 50-day moving average and 61.8% retracement.
I’m not sure if Nvidia will dip ahead of earnings or rally into the print. But if the recent momentum is any guess, a pre-earnings run is possible.
Top Stock Trades for Monday No. 3: Aurora Cannabis (ACB)
Click to Enlarge
Not many investors were looking for a 60%-plus move in Aurora Cannabis (NYSE:ACB) on Friday. In fact, the charts were looking quite bearish with this week’s big break below $8 support.
I said shares needed to reclaim this mark in order to look better on the long side. Clearing its moving averages and downtrend resistance would be next. Did ACB answer the call or what?
5 High-Quality Company Stocks to Buy For Less Than $10
The rally puts $13.50 in play, followed by a possible rally north of $15. Longs who want to try and ride ACB stock need to keep an eye on $8. Below that mark and shares will look iffy again.
Top Stock Trades for Monday No. 4: Macy’s (M)
Click to Enlarge
If I didn’t know better, I’d say this chart of Macy’s (NYSE:M) looks just like an airline stock. That’s fitting, with both department stores and airlines under tremendous pressure.
For now, shares continue to hold the $4.75 area. However, as the 20-day moving average pressures it lower, and with Macy’s under downtrend resistance and the 50-day moving average, bears are clearly in control here.
To feel confident on the long side — such as with the move in ACB stock — Macy’s needs to clear these resistance levels on the upside. A quick trade could develop with a move over the 20-day moving average, putting $6 in play. Above all of the mentioned resistance could put $7 in the mix.
Below this week’s low at $4.65 puts the 52-week low at $4.38 on the table.
Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long NVDA.
The post 4 Top Stock Trades for Monday: GE, NVDA, ACB, M appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | To feel confident on the long side — such as with the move in ACB stock — Macy’s needs to clear these resistance levels on the upside. The post 4 Top Stock Trades for Monday: GE, NVDA, ACB, M appeared first on InvestorPlace. 3: Aurora Cannabis (ACB) | The post 4 Top Stock Trades for Monday: GE, NVDA, ACB, M appeared first on InvestorPlace. 3: Aurora Cannabis (ACB) Click to Enlarge Not many investors were looking for a 60%-plus move in Aurora Cannabis (NYSE:ACB) on Friday. | 3: Aurora Cannabis (ACB) Click to Enlarge Not many investors were looking for a 60%-plus move in Aurora Cannabis (NYSE:ACB) on Friday. Did ACB answer the call or what? | The post 4 Top Stock Trades for Monday: GE, NVDA, ACB, M appeared first on InvestorPlace. 3: Aurora Cannabis (ACB) Click to Enlarge Not many investors were looking for a 60%-plus move in Aurora Cannabis (NYSE:ACB) on Friday. |
37508.0 | 2020-05-15 00:00:00 UTC | Why Canopy Growth, Cronos Group, and OrganiGram Soared Today | ACB | https://www.nasdaq.com/articles/why-canopy-growth-cronos-group-and-organigram-soared-today-2020-05-15 | nan | nan | What happened
Shares of several top Canadian cannabis producers soared today after one of their peers, Aurora Cannabis (NYSE: ACB), reported better-than-expected fiscal 2020 third-quarter revenue growth after the market closed on Thursday. Canopy Growth (NYSE: CGC) stock was up 13.4% as of 3:38 p.m. EDT on Friday, while shares of Cronos Group (NASDAQ: CRON) and OrganiGram Holdings (NASDAQ: OGI) were up 10.3% and 13.5%, respectively.
So what
Investors now appear to be increasingly optimistic that the rest of the Canadian cannabis industry could also enjoy a turn for the better after a challenging period following Aurora's surprisingly positive results. Probably the best news for Canopy, Cronos, and OrganiGram from Aurora's Q3 update was across-the-board revenue growth.
Image source: Getty Images.
Aurora reported 18% quarter-over-quarter sales growth in the Canadian adult-use recreational marijuana market. Its Canadian medical cannabis sales rose 6%. The company's international medical cannabis revenue skyrocketed 125%. But is this growth a clear sign of better days ahead for Canopy, Cronos, and OrganiGram? Not necessarily.
The solid recreational sales growth for Aurora stemmed in large part from the company's launch of a new value brand. While other companies have also introduced value brands, they aren't guaranteed to see the same level of success that Aurora has.
As for Aurora's huge international revenue jump, it resulted from the company's resumption of medical cannabis sales in Germany after having its license temporarily suspended. This obviously won't translate to stronger international prospects for the other cannabis producers.
Now what
Although a rising tide lifts all boats, it remains to be seen just how much the tide is actually rising for the Canadian cannabis industry. Some of the same problems that have plagued the industry in the past, especially a constrained retail infrastructure, are still issues.
However, it's quite possible that Canadian marijuana stocks will rebound over the next few months. If concerns about the COVID-19 outbreak diminish and the Cannabis 2.0 cannabis derivatives market gains momentum, Canopy, Cronos, and OrganiGram could all enjoy a better year in 2020 than they had in 2019.
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Keith Speights has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends OrganiGram Holdings. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | What happened Shares of several top Canadian cannabis producers soared today after one of their peers, Aurora Cannabis (NYSE: ACB), reported better-than-expected fiscal 2020 third-quarter revenue growth after the market closed on Thursday. So what Investors now appear to be increasingly optimistic that the rest of the Canadian cannabis industry could also enjoy a turn for the better after a challenging period following Aurora's surprisingly positive results. As for Aurora's huge international revenue jump, it resulted from the company's resumption of medical cannabis sales in Germany after having its license temporarily suspended. | What happened Shares of several top Canadian cannabis producers soared today after one of their peers, Aurora Cannabis (NYSE: ACB), reported better-than-expected fiscal 2020 third-quarter revenue growth after the market closed on Thursday. Aurora reported 18% quarter-over-quarter sales growth in the Canadian adult-use recreational marijuana market. The company's international medical cannabis revenue skyrocketed 125%. | What happened Shares of several top Canadian cannabis producers soared today after one of their peers, Aurora Cannabis (NYSE: ACB), reported better-than-expected fiscal 2020 third-quarter revenue growth after the market closed on Thursday. If concerns about the COVID-19 outbreak diminish and the Cannabis 2.0 cannabis derivatives market gains momentum, Canopy, Cronos, and OrganiGram could all enjoy a better year in 2020 than they had in 2019. Here's The Marijuana Stock You've Been Waiting For A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom. | What happened Shares of several top Canadian cannabis producers soared today after one of their peers, Aurora Cannabis (NYSE: ACB), reported better-than-expected fiscal 2020 third-quarter revenue growth after the market closed on Thursday. Canopy Growth (NYSE: CGC) stock was up 13.4% as of 3:38 p.m. EDT on Friday, while shares of Cronos Group (NASDAQ: CRON) and OrganiGram Holdings (NASDAQ: OGI) were up 10.3% and 13.5%, respectively. As for Aurora's huge international revenue jump, it resulted from the company's resumption of medical cannabis sales in Germany after having its license temporarily suspended. |
37509.0 | 2020-05-15 00:00:00 UTC | Aurora Cannabis (ACB) Stock Is a Buy, But Wait for a Better Entry Point | ACB | https://www.nasdaq.com/articles/aurora-cannabis-acb-stock-is-a-buy-but-wait-for-a-better-entry-point-2020-05-15 | nan | nan | With the stock collapsing following the reverse split, Aurora Cannabis (ACB) needed a strong quarter to change the trend. The Canadian cannabis company is in the middle of a transformational plan that doesn’t always work out as planned.
The company delivered in spades. Not only did Aurora report crucial progress in cutting out of costs, but also the company smashed revenue estimates during the coronavirus outbreak. The stock has bounced strong off the lows and is likely headed higher now.
According to TipRanks, the consensus on Wall Street is that Aurora Cannabis stock is a “hold” for investors. On one hand, TipRanks might as well have said “buy” — because analysts, on average, think the stock, currently at $10.44, could zoom ahead to $12.78, delivering about 20% profits to new investors. On the other hand, Aurora stock could present investors with better entry points than at $10.44 per share.
Dazzling Quarter
While the company only guided to a modest sequential revenue increase from the prior quarter, Aurora Cannabis grew total revenues by over C$11.8 million to C$78.4 million. The company saw impressive growth in Canadian recreational cannabis sales due to the introduction of the value brand while international medical cannabis rebounded with Germany sales back online.
A big key here is that gross margins remained a healthy 54%. The value brand wasn’t destructive to margins setting Aurora on a path to reaching EBITDA profits for the first time in years.
Aurora cut SG&A expenses that swelled to C$99 million in FQ2 by C$24 million to C$75 million. More importantly, the company is on a SG&A run-rate of C$55 million currently and expects to reach the C$45 million goal by quarter end. The number is far more impressive considering R&D expenses were pushed into the C$45 million target while costs were over C$5 million in the last quarter.
The end result was a big C$34 million cut to the adjusted EBITDA loss. Another C$30 million cut in operating expenses in FQ4 gets the Canadian cannabis company close to EBITDA breakeven.
Cash Burn
Some analysts had estimated that Aurora Cannabis burned up to C$200 million in cash during the March quarter, but the number only hit C$154 million. Similar to the cut in operating expense, the company expects to make a huge leap forward in the June quarter cash burn that is a game changer for building shareholder wealth.
The company ended the quarter with C$230 million in cash and is likely to reduce cash burn below C$50 million in the current quarter. First, the operating losses are likely reduced by at least C$30 million from the cash burn levels. Second, the capital spending is forecast to dip C$50 million from the prior quarter to below C$25 million in the current quarter.
While it took a long time, Aurora Cannabis finally has its fiscal house in order. The company should reach EBITDA positive in the September quarter with decent revenue growth in Canada from additional retail stores in Ontario and further expansion of Cannabis 2.0 products. Not to mention, the larger companies are likely beneficiaries of weaker players struggling in the current economic climate.
Takeaway
The key investor takeaway is that the valuation equation for Aurora Cannabis is far more interesting here as the market pushed the stock to post split lows of $5.30. Even at the $11 level following a big rally, the stock only has a market cap of $1.15 billion.
Investors should feel much more confident in the stock here with reasonable expectations for FY21 revenues topping $300 million and the company having limited funding going. The stock is likely to make a continued rally here, but investors should wait for a pullback first to buy here after the big rally.
To find good ideas for cannabis stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | With the stock collapsing following the reverse split, Aurora Cannabis (ACB) needed a strong quarter to change the trend. On one hand, TipRanks might as well have said “buy” — because analysts, on average, think the stock, currently at $10.44, could zoom ahead to $12.78, delivering about 20% profits to new investors. Similar to the cut in operating expense, the company expects to make a huge leap forward in the June quarter cash burn that is a game changer for building shareholder wealth. | With the stock collapsing following the reverse split, Aurora Cannabis (ACB) needed a strong quarter to change the trend. The company saw impressive growth in Canadian recreational cannabis sales due to the introduction of the value brand while international medical cannabis rebounded with Germany sales back online. Another C$30 million cut in operating expenses in FQ4 gets the Canadian cannabis company close to EBITDA breakeven. | With the stock collapsing following the reverse split, Aurora Cannabis (ACB) needed a strong quarter to change the trend. Dazzling Quarter While the company only guided to a modest sequential revenue increase from the prior quarter, Aurora Cannabis grew total revenues by over C$11.8 million to C$78.4 million. Cash Burn Some analysts had estimated that Aurora Cannabis burned up to C$200 million in cash during the March quarter, but the number only hit C$154 million. | With the stock collapsing following the reverse split, Aurora Cannabis (ACB) needed a strong quarter to change the trend. On one hand, TipRanks might as well have said “buy” — because analysts, on average, think the stock, currently at $10.44, could zoom ahead to $12.78, delivering about 20% profits to new investors. Dazzling Quarter While the company only guided to a modest sequential revenue increase from the prior quarter, Aurora Cannabis grew total revenues by over C$11.8 million to C$78.4 million. |
37510.0 | 2020-05-15 00:00:00 UTC | BUZZ-U.S. STOCKS ON THE MOVE-Tetraphase Pharma, Digirad, Aurora Cannabis | ACB | https://www.nasdaq.com/articles/buzz-u.s.-stocks-on-the-move-tetraphase-pharma-digirad-aurora-cannabis-2020-05-15 | nan | nan | Eikon search string for individual stock moves: STXBZ
The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi
The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh
Wall Street's main indexes were set to open lower on Friday after the Trump administration's move to block semiconductor shipments to China's Huawei Technologies ratcheted up fears of trade hostilities between Washington and Beijing..N
At 08:57 ET, Dow e-minis 1YMc1 were down 0.98% at 23,304. S&P 500 e-minis ESc1 were down 0.99% at 2,818.75, while Nasdaq 100 e-minis NQc1 were down 1.37% at 8,955.25. The top three NYSE percentage gainers premarket .PRPG.NQ: ** Aurora Cannabis Inc , up 30.7% ** Babcock & Wilcox Enterprises Inc , up 25.0% ** Advansix Inc , up 20.1% The top three NYSE percentage losers premarket .PRPL.NQ: ** Medifast Inc , down 28.1% ** Laredo Petroleum Inc , down 17% ** J C Penney Company Inc , down 15.4% The top three Nasdaq percentage gainers premarket .PRPG.O: ** Bridgeline Digital Inc , up 78.2% ** Seneca Biopharma Inc , up 61.4% ** Torchlight Energy Resources Inc , up 44.8% The top three Nasdaq percentage losers premarket .PRPL.O: ** Cassava Sciences Inc , down 83.2% ** Creative Realities Equity Warrants , down 50% ** Synthesis Energy Systems Inc , down 39.3% ** SG Blocks Inc SGBX.O: down 13.7% premarket BUZZ-Slides after posting bigger-than-expected loss ** Royal Gold Inc RGLD.O: up 0.2% premarket BUZZ-RBC upgrades on supportive production and financial outlook ** Laboratory Corp of America Holdings LH.N: up 1.4% premarket BUZZ-Mizuho says 'buy' as co is part of solution to COVID-19 ** Aurora Cannabis Inc ACB.N: up 30.7% premarket BUZZ-Pot stocks gain as Aurora Cannabis rallies on upbeat Q3 BUZZ-Street View: Aurora Cannabis' uncertainty remains even after cost cuts ** Bridgeline Digital Inc BLIN.O: up 78.2% premarket BUZZ-Rises on quarterly profit vs year-ago loss ** TG Therapeutics Inc TGTX.O: down 6.1% premarket BUZZ-Dips after pricing upsized stock offering ** New Relic Inc NEWR.N: up 13.2% premarket BUZZ-Surges on strong revenue, brokerages raise PT ** Boeing Co BA.N: down 2.7% premarket ** Qualcomm Inc QCOM.O: down 5.4% premarket ** Cisco Systems Inc CSCO.O: down 2.4% premarket ** Apple Inc AAPL.O: down 2.6% premarket BUZZ-Boeing, Apple, Qualcomm, Cisco fall as U.S.-China tensions escalate ** Farfetch Ltd FTCH.N: down 11.5% premarket BUZZ-Farfetch drops after warning of coronavirus impact ** Wayfair Inc W.N: down 3.5% premarket BUZZ-Citi cuts to 'sell' on 'too much optimism' in profitability ** Digirad Corp DRAD.O: up 17.3% premarket BUZZ-Rises on higher quarterly revenue ** VF Corp VFC.N: down 6.2% premarket BUZZ-Vans owner trips over sales warning ** Nike Inc NKE.N: down 1.6% premarket BUZZ-Nike warns of Q4 financial hit, shares fall ** Hologic Inc HOLX.O: up 3.5% premarket BUZZ-Rises on U.S. FDA nod for emergency use of second COVID-19 test ** Tetraphase Pharmaceuticals Inc TTPH.O: up 43.9% premarket BUZZ-Soars on unsolicited buyout offer ** Abbott Laboratories ABT.N: down 2.4% premarket BUZZ-Falls as U.S. FDA raises accuracy concern for fast COVID-19 test
(Compiled by Amal S in Bengaluru)
((Amal.S@thomsonreuters.com; within U.S.+1 646 223 8780; outside U.S. +91 80 6749 3677;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The top three NYSE percentage gainers premarket .PRPG.NQ: ** Aurora Cannabis Inc , up 30.7% ** Babcock & Wilcox Enterprises Inc , up 25.0% ** Advansix Inc , up 20.1% The top three NYSE percentage losers premarket .PRPL.NQ: ** Medifast Inc , down 28.1% ** Laredo Petroleum Inc , down 17% ** J C Penney Company Inc , down 15.4% The top three Nasdaq percentage gainers premarket .PRPG.O: ** Bridgeline Digital Inc , up 78.2% ** Seneca Biopharma Inc , up 61.4% ** Torchlight Energy Resources Inc , up 44.8% The top three Nasdaq percentage losers premarket .PRPL.O: ** Cassava Sciences Inc , down 83.2% ** Creative Realities Equity Warrants , down 50% ** Synthesis Energy Systems Inc , down 39.3% ** SG Blocks Inc SGBX.O: down 13.7% premarket BUZZ-Slides after posting bigger-than-expected loss ** Royal Gold Inc RGLD.O: up 0.2% premarket BUZZ-RBC upgrades on supportive production and financial outlook ** Laboratory Corp of America Holdings LH.N: up 1.4% premarket BUZZ-Mizuho says 'buy' as co is part of solution to COVID-19 ** Aurora Cannabis Inc ACB.N: up 30.7% premarket BUZZ-Pot stocks gain as Aurora Cannabis rallies on upbeat Q3 BUZZ-Street View: Aurora Cannabis' uncertainty remains even after cost cuts ** Bridgeline Digital Inc BLIN.O: up 78.2% premarket BUZZ-Rises on quarterly profit vs year-ago loss ** TG Therapeutics Inc TGTX.O: down 6.1% premarket BUZZ-Dips after pricing upsized stock offering ** New Relic Inc NEWR.N: up 13.2% premarket BUZZ-Surges on strong revenue, brokerages raise PT ** Boeing Co BA.N: down 2.7% premarket ** Qualcomm Inc QCOM.O: down 5.4% premarket ** Cisco Systems Inc CSCO.O: down 2.4% premarket ** Apple Inc AAPL.O: down 2.6% premarket BUZZ-Boeing, Apple, Qualcomm, Cisco fall as U.S.-China tensions escalate ** Farfetch Ltd FTCH.N: down 11.5% premarket BUZZ-Farfetch drops after warning of coronavirus impact ** Wayfair Inc W.N: down 3.5% premarket BUZZ-Citi cuts to 'sell' on 'too much optimism' in profitability ** Digirad Corp DRAD.O: up 17.3% premarket BUZZ-Rises on higher quarterly revenue ** VF Corp VFC.N: down 6.2% premarket BUZZ-Vans owner trips over sales warning ** Nike Inc NKE.N: down 1.6% premarket BUZZ-Nike warns of Q4 financial hit, shares fall ** Hologic Inc HOLX.O: up 3.5% premarket BUZZ-Rises on U.S. FDA nod for emergency use of second COVID-19 test ** Tetraphase Pharmaceuticals Inc TTPH.O: up 43.9% premarket BUZZ-Soars on unsolicited buyout offer ** Abbott Laboratories ABT.N: down 2.4% premarket BUZZ-Falls as U.S. FDA raises accuracy concern for fast COVID-19 test (Compiled by Amal S in Bengaluru) ((Amal.S@thomsonreuters.com; within U.S.+1 646 223 8780; outside U.S. +91 80 6749 3677;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. Eikon search string for individual stock moves: STXBZ The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh Wall Street's main indexes were set to open lower on Friday after the Trump administration's move to block semiconductor shipments to China's Huawei Technologies ratcheted up fears of trade hostilities between Washington and Beijing..N At 08:57 ET, Dow e-minis 1YMc1 were down 0.98% at 23,304. S&P 500 e-minis ESc1 were down 0.99% at 2,818.75, while Nasdaq 100 e-minis NQc1 were down 1.37% at 8,955.25. | The top three NYSE percentage gainers premarket .PRPG.NQ: ** Aurora Cannabis Inc , up 30.7% ** Babcock & Wilcox Enterprises Inc , up 25.0% ** Advansix Inc , up 20.1% The top three NYSE percentage losers premarket .PRPL.NQ: ** Medifast Inc , down 28.1% ** Laredo Petroleum Inc , down 17% ** J C Penney Company Inc , down 15.4% The top three Nasdaq percentage gainers premarket .PRPG.O: ** Bridgeline Digital Inc , up 78.2% ** Seneca Biopharma Inc , up 61.4% ** Torchlight Energy Resources Inc , up 44.8% The top three Nasdaq percentage losers premarket .PRPL.O: ** Cassava Sciences Inc , down 83.2% ** Creative Realities Equity Warrants , down 50% ** Synthesis Energy Systems Inc , down 39.3% ** SG Blocks Inc SGBX.O: down 13.7% premarket BUZZ-Slides after posting bigger-than-expected loss ** Royal Gold Inc RGLD.O: up 0.2% premarket BUZZ-RBC upgrades on supportive production and financial outlook ** Laboratory Corp of America Holdings LH.N: up 1.4% premarket BUZZ-Mizuho says 'buy' as co is part of solution to COVID-19 ** Aurora Cannabis Inc ACB.N: up 30.7% premarket BUZZ-Pot stocks gain as Aurora Cannabis rallies on upbeat Q3 BUZZ-Street View: Aurora Cannabis' uncertainty remains even after cost cuts ** Bridgeline Digital Inc BLIN.O: up 78.2% premarket BUZZ-Rises on quarterly profit vs year-ago loss ** TG Therapeutics Inc TGTX.O: down 6.1% premarket BUZZ-Dips after pricing upsized stock offering ** New Relic Inc NEWR.N: up 13.2% premarket BUZZ-Surges on strong revenue, brokerages raise PT ** Boeing Co BA.N: down 2.7% premarket ** Qualcomm Inc QCOM.O: down 5.4% premarket ** Cisco Systems Inc CSCO.O: down 2.4% premarket ** Apple Inc AAPL.O: down 2.6% premarket BUZZ-Boeing, Apple, Qualcomm, Cisco fall as U.S.-China tensions escalate ** Farfetch Ltd FTCH.N: down 11.5% premarket BUZZ-Farfetch drops after warning of coronavirus impact ** Wayfair Inc W.N: down 3.5% premarket BUZZ-Citi cuts to 'sell' on 'too much optimism' in profitability ** Digirad Corp DRAD.O: up 17.3% premarket BUZZ-Rises on higher quarterly revenue ** VF Corp VFC.N: down 6.2% premarket BUZZ-Vans owner trips over sales warning ** Nike Inc NKE.N: down 1.6% premarket BUZZ-Nike warns of Q4 financial hit, shares fall ** Hologic Inc HOLX.O: up 3.5% premarket BUZZ-Rises on U.S. FDA nod for emergency use of second COVID-19 test ** Tetraphase Pharmaceuticals Inc TTPH.O: up 43.9% premarket BUZZ-Soars on unsolicited buyout offer ** Abbott Laboratories ABT.N: down 2.4% premarket BUZZ-Falls as U.S. FDA raises accuracy concern for fast COVID-19 test (Compiled by Amal S in Bengaluru) ((Amal.S@thomsonreuters.com; within U.S.+1 646 223 8780; outside U.S. +91 80 6749 3677;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. Eikon search string for individual stock moves: STXBZ The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh Wall Street's main indexes were set to open lower on Friday after the Trump administration's move to block semiconductor shipments to China's Huawei Technologies ratcheted up fears of trade hostilities between Washington and Beijing..N At 08:57 ET, Dow e-minis 1YMc1 were down 0.98% at 23,304. S&P 500 e-minis ESc1 were down 0.99% at 2,818.75, while Nasdaq 100 e-minis NQc1 were down 1.37% at 8,955.25. | The top three NYSE percentage gainers premarket .PRPG.NQ: ** Aurora Cannabis Inc , up 30.7% ** Babcock & Wilcox Enterprises Inc , up 25.0% ** Advansix Inc , up 20.1% The top three NYSE percentage losers premarket .PRPL.NQ: ** Medifast Inc , down 28.1% ** Laredo Petroleum Inc , down 17% ** J C Penney Company Inc , down 15.4% The top three Nasdaq percentage gainers premarket .PRPG.O: ** Bridgeline Digital Inc , up 78.2% ** Seneca Biopharma Inc , up 61.4% ** Torchlight Energy Resources Inc , up 44.8% The top three Nasdaq percentage losers premarket .PRPL.O: ** Cassava Sciences Inc , down 83.2% ** Creative Realities Equity Warrants , down 50% ** Synthesis Energy Systems Inc , down 39.3% ** SG Blocks Inc SGBX.O: down 13.7% premarket BUZZ-Slides after posting bigger-than-expected loss ** Royal Gold Inc RGLD.O: up 0.2% premarket BUZZ-RBC upgrades on supportive production and financial outlook ** Laboratory Corp of America Holdings LH.N: up 1.4% premarket BUZZ-Mizuho says 'buy' as co is part of solution to COVID-19 ** Aurora Cannabis Inc ACB.N: up 30.7% premarket BUZZ-Pot stocks gain as Aurora Cannabis rallies on upbeat Q3 BUZZ-Street View: Aurora Cannabis' uncertainty remains even after cost cuts ** Bridgeline Digital Inc BLIN.O: up 78.2% premarket BUZZ-Rises on quarterly profit vs year-ago loss ** TG Therapeutics Inc TGTX.O: down 6.1% premarket BUZZ-Dips after pricing upsized stock offering ** New Relic Inc NEWR.N: up 13.2% premarket BUZZ-Surges on strong revenue, brokerages raise PT ** Boeing Co BA.N: down 2.7% premarket ** Qualcomm Inc QCOM.O: down 5.4% premarket ** Cisco Systems Inc CSCO.O: down 2.4% premarket ** Apple Inc AAPL.O: down 2.6% premarket BUZZ-Boeing, Apple, Qualcomm, Cisco fall as U.S.-China tensions escalate ** Farfetch Ltd FTCH.N: down 11.5% premarket BUZZ-Farfetch drops after warning of coronavirus impact ** Wayfair Inc W.N: down 3.5% premarket BUZZ-Citi cuts to 'sell' on 'too much optimism' in profitability ** Digirad Corp DRAD.O: up 17.3% premarket BUZZ-Rises on higher quarterly revenue ** VF Corp VFC.N: down 6.2% premarket BUZZ-Vans owner trips over sales warning ** Nike Inc NKE.N: down 1.6% premarket BUZZ-Nike warns of Q4 financial hit, shares fall ** Hologic Inc HOLX.O: up 3.5% premarket BUZZ-Rises on U.S. FDA nod for emergency use of second COVID-19 test ** Tetraphase Pharmaceuticals Inc TTPH.O: up 43.9% premarket BUZZ-Soars on unsolicited buyout offer ** Abbott Laboratories ABT.N: down 2.4% premarket BUZZ-Falls as U.S. FDA raises accuracy concern for fast COVID-19 test (Compiled by Amal S in Bengaluru) ((Amal.S@thomsonreuters.com; within U.S.+1 646 223 8780; outside U.S. +91 80 6749 3677;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. Eikon search string for individual stock moves: STXBZ The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh Wall Street's main indexes were set to open lower on Friday after the Trump administration's move to block semiconductor shipments to China's Huawei Technologies ratcheted up fears of trade hostilities between Washington and Beijing..N At 08:57 ET, Dow e-minis 1YMc1 were down 0.98% at 23,304. S&P 500 e-minis ESc1 were down 0.99% at 2,818.75, while Nasdaq 100 e-minis NQc1 were down 1.37% at 8,955.25. | The top three NYSE percentage gainers premarket .PRPG.NQ: ** Aurora Cannabis Inc , up 30.7% ** Babcock & Wilcox Enterprises Inc , up 25.0% ** Advansix Inc , up 20.1% The top three NYSE percentage losers premarket .PRPL.NQ: ** Medifast Inc , down 28.1% ** Laredo Petroleum Inc , down 17% ** J C Penney Company Inc , down 15.4% The top three Nasdaq percentage gainers premarket .PRPG.O: ** Bridgeline Digital Inc , up 78.2% ** Seneca Biopharma Inc , up 61.4% ** Torchlight Energy Resources Inc , up 44.8% The top three Nasdaq percentage losers premarket .PRPL.O: ** Cassava Sciences Inc , down 83.2% ** Creative Realities Equity Warrants , down 50% ** Synthesis Energy Systems Inc , down 39.3% ** SG Blocks Inc SGBX.O: down 13.7% premarket BUZZ-Slides after posting bigger-than-expected loss ** Royal Gold Inc RGLD.O: up 0.2% premarket BUZZ-RBC upgrades on supportive production and financial outlook ** Laboratory Corp of America Holdings LH.N: up 1.4% premarket BUZZ-Mizuho says 'buy' as co is part of solution to COVID-19 ** Aurora Cannabis Inc ACB.N: up 30.7% premarket BUZZ-Pot stocks gain as Aurora Cannabis rallies on upbeat Q3 BUZZ-Street View: Aurora Cannabis' uncertainty remains even after cost cuts ** Bridgeline Digital Inc BLIN.O: up 78.2% premarket BUZZ-Rises on quarterly profit vs year-ago loss ** TG Therapeutics Inc TGTX.O: down 6.1% premarket BUZZ-Dips after pricing upsized stock offering ** New Relic Inc NEWR.N: up 13.2% premarket BUZZ-Surges on strong revenue, brokerages raise PT ** Boeing Co BA.N: down 2.7% premarket ** Qualcomm Inc QCOM.O: down 5.4% premarket ** Cisco Systems Inc CSCO.O: down 2.4% premarket ** Apple Inc AAPL.O: down 2.6% premarket BUZZ-Boeing, Apple, Qualcomm, Cisco fall as U.S.-China tensions escalate ** Farfetch Ltd FTCH.N: down 11.5% premarket BUZZ-Farfetch drops after warning of coronavirus impact ** Wayfair Inc W.N: down 3.5% premarket BUZZ-Citi cuts to 'sell' on 'too much optimism' in profitability ** Digirad Corp DRAD.O: up 17.3% premarket BUZZ-Rises on higher quarterly revenue ** VF Corp VFC.N: down 6.2% premarket BUZZ-Vans owner trips over sales warning ** Nike Inc NKE.N: down 1.6% premarket BUZZ-Nike warns of Q4 financial hit, shares fall ** Hologic Inc HOLX.O: up 3.5% premarket BUZZ-Rises on U.S. FDA nod for emergency use of second COVID-19 test ** Tetraphase Pharmaceuticals Inc TTPH.O: up 43.9% premarket BUZZ-Soars on unsolicited buyout offer ** Abbott Laboratories ABT.N: down 2.4% premarket BUZZ-Falls as U.S. FDA raises accuracy concern for fast COVID-19 test (Compiled by Amal S in Bengaluru) ((Amal.S@thomsonreuters.com; within U.S.+1 646 223 8780; outside U.S. +91 80 6749 3677;)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. Eikon search string for individual stock moves: STXBZ The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh Wall Street's main indexes were set to open lower on Friday after the Trump administration's move to block semiconductor shipments to China's Huawei Technologies ratcheted up fears of trade hostilities between Washington and Beijing..N At 08:57 ET, Dow e-minis 1YMc1 were down 0.98% at 23,304. S&P 500 e-minis ESc1 were down 0.99% at 2,818.75, while Nasdaq 100 e-minis NQc1 were down 1.37% at 8,955.25. |
37511.0 | 2020-05-15 00:00:00 UTC | Why Aurora Cannabis Stock Is Skyrocketing 39% Today | ACB | https://www.nasdaq.com/articles/why-aurora-cannabis-stock-is-skyrocketing-39-today-2020-05-15 | nan | nan | What happened
Shares of Aurora Cannabis (NYSE: ACB) were skyrocketing 39.2% as of 10:56 a.m. EDT on Friday. The huge gain came after the Canadian cannabis producer announced better-than-expected fiscal 2020 third-quarter results after the market closed on Thursday.
Aurora's Q3 net revenue increased 18% over the prior quarter to 78.4 million in Canadian dollars ($55.6 million), excluding provisions of CA$2.9 million. This trounced the average analyst estimate of Q3 revenue of CA$66.7 million.
Image source: Getty Images.
So what
For months, most of Aurora's news has been negative. Its across-the-board revenue growth in the third quarter gave investors a pleasant surprise.
While Aurora's unexpectedly strong growth received the most attention, there were other positive stories in the company's Q3 update. Perhaps the most important was Aurora's significant reduction in cash burn. The company used CA$118 million less in cash during the third quarter than it did in the previous quarter.
This lower cash burn should help Aurora achieve its goal of generating positive adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA). The company said that it expects to reach this goal in the quarter ending Sept. 30, 2020.
Now what
Aurora's improvement in the third quarter doesn't change the company's biggest problem: It's still unprofitable. The company is likely to require more cash in the not-too-distant future. In the meantime, the marijuana stock will likely remain highly volatile.
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Keith Speights has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | What happened Shares of Aurora Cannabis (NYSE: ACB) were skyrocketing 39.2% as of 10:56 a.m. EDT on Friday. The huge gain came after the Canadian cannabis producer announced better-than-expected fiscal 2020 third-quarter results after the market closed on Thursday. This lower cash burn should help Aurora achieve its goal of generating positive adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA). | What happened Shares of Aurora Cannabis (NYSE: ACB) were skyrocketing 39.2% as of 10:56 a.m. EDT on Friday. Aurora's Q3 net revenue increased 18% over the prior quarter to 78.4 million in Canadian dollars ($55.6 million), excluding provisions of CA$2.9 million. The company used CA$118 million less in cash during the third quarter than it did in the previous quarter. | What happened Shares of Aurora Cannabis (NYSE: ACB) were skyrocketing 39.2% as of 10:56 a.m. EDT on Friday. Aurora's Q3 net revenue increased 18% over the prior quarter to 78.4 million in Canadian dollars ($55.6 million), excluding provisions of CA$2.9 million. The company used CA$118 million less in cash during the third quarter than it did in the previous quarter. | What happened Shares of Aurora Cannabis (NYSE: ACB) were skyrocketing 39.2% as of 10:56 a.m. EDT on Friday. The company used CA$118 million less in cash during the third quarter than it did in the previous quarter. Here's The Marijuana Stock You've Been Waiting For A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom. |
37512.0 | 2020-05-15 00:00:00 UTC | Why Aphria Stock Jumped Today | ACB | https://www.nasdaq.com/articles/why-aphria-stock-jumped-today-2020-05-15 | nan | nan | What happened?
Aphria (NYSE: APHA) ended the week on a strong note. Shares of the Ontario-based cannabis company climbed by 11.3% on Friday, despite the company not reporting any news.
The catalyst for Aphria's stock rising today seems to be the better-than-expected financial results Aurora Cannabis (NYSE: ACB) -- one of Aphria's peers in the marijuana industry -- reported after the market closed on Thursday. Aphria is simply riding the positive wave started by its competitor.
So what
There was little hope that Aurora Cannabis would be able to deliver strong financial results, especially after Tilray (NASDAQ: TLRY) -- another big player in the marijuana industry -- disappointed with its own earnings report. However, Aurora Cannabis's net revenue of CA$78.4 million (excluding provisions of 2.9 million Canadian dollars) came in higher than the 66.7 million Canadian dollars analysts were expecting.
The cannabis company's total net revenue also increased by 35% sequentially. These results -- which are especially noteworthy considering the ongoing crisis -- may have helped investors regain a little trust in the cannabis industry, which has been profoundly disappointing over the past year or so.
Image source: Getty Images.
Now what
For its part, Aphria has consistently delivered strong financial results of late, especially when compared to its peers in the cannabis industry. For instance, in its most recent quarterly update, the company recorded a net revenue of 144.4 million Canadian dollars, a 19.8% sequential increase. Even with its gains on the market today, though, Aphria's stock is still down by more than 30% year to date. This presents a decent buying opportunity for investors looking to buy shares of this cannabis company.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Prosper Junior Bakiny owns shares of Aurora Cannabis Inc. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The catalyst for Aphria's stock rising today seems to be the better-than-expected financial results Aurora Cannabis (NYSE: ACB) -- one of Aphria's peers in the marijuana industry -- reported after the market closed on Thursday. So what There was little hope that Aurora Cannabis would be able to deliver strong financial results, especially after Tilray (NASDAQ: TLRY) -- another big player in the marijuana industry -- disappointed with its own earnings report. These results -- which are especially noteworthy considering the ongoing crisis -- may have helped investors regain a little trust in the cannabis industry, which has been profoundly disappointing over the past year or so. | The catalyst for Aphria's stock rising today seems to be the better-than-expected financial results Aurora Cannabis (NYSE: ACB) -- one of Aphria's peers in the marijuana industry -- reported after the market closed on Thursday. However, Aurora Cannabis's net revenue of CA$78.4 million (excluding provisions of 2.9 million Canadian dollars) came in higher than the 66.7 million Canadian dollars analysts were expecting. For instance, in its most recent quarterly update, the company recorded a net revenue of 144.4 million Canadian dollars, a 19.8% sequential increase. | The catalyst for Aphria's stock rising today seems to be the better-than-expected financial results Aurora Cannabis (NYSE: ACB) -- one of Aphria's peers in the marijuana industry -- reported after the market closed on Thursday. So what There was little hope that Aurora Cannabis would be able to deliver strong financial results, especially after Tilray (NASDAQ: TLRY) -- another big player in the marijuana industry -- disappointed with its own earnings report. However, Aurora Cannabis's net revenue of CA$78.4 million (excluding provisions of 2.9 million Canadian dollars) came in higher than the 66.7 million Canadian dollars analysts were expecting. | The catalyst for Aphria's stock rising today seems to be the better-than-expected financial results Aurora Cannabis (NYSE: ACB) -- one of Aphria's peers in the marijuana industry -- reported after the market closed on Thursday. Shares of the Ontario-based cannabis company climbed by 11.3% on Friday, despite the company not reporting any news. So what There was little hope that Aurora Cannabis would be able to deliver strong financial results, especially after Tilray (NASDAQ: TLRY) -- another big player in the marijuana industry -- disappointed with its own earnings report. |
37513.0 | 2020-05-15 00:00:00 UTC | 3 Positive Surprises in Aurora Cannabis' Q3 Results: Is the Pot Stock Ready to Rebound? | ACB | https://www.nasdaq.com/articles/3-positive-surprises-in-aurora-cannabis-q3-results%3A-is-the-pot-stock-ready-to-rebound-2020 | nan | nan | There's one number that stands out the most for Aurora Cannabis (NYSE: ACB) over the last 12 months -- 92%. That's how much Aurora's shares have plunged during the period. The marijuana version of Murphy's law has struck the Canadian cannabis producer at every turn.
But Aurora reported some much more encouraging numbers when it announced its fiscal 2020 third-quarter results after the market closed on Thursday. Shares even soared close to 17% in after-hours trading. Here are three positive surprises in the company's Q3 update -- and whether or not Aurora is really now ready to rebound.
Image source: Getty Images.
1. Much higher revenue than expected
The average analysts' estimate was for Aurora to report revenue in the third quarter of 66.7 million Canadian dollars. Aurora's actual net revenue in Q3 totaled CA$78.4 million, excluding provisions of CA$2.9 million, easily blowing past expectations. This result also reflected an 18% jump over the prior quarter.
Aurora delivered growth on all fronts. Its consumer cannabis revenue jumped 24% from the prior quarter to CA$41.5 million (excluding provisions). Canadian medical cannabis net revenue rose 6% quarter over quarter to CA$27 million. International medical cannabis sales skyrocketed 125% to CA$4 million.
The company's launch of its Daily Special value brand in February, along with sales of cannabis derivative products in the Cannabis 2.0 market, were the primary drivers of Aurora's consumer revenue growth. The huge jump in international revenue stemmed from Aurora's resumption of operations in Germany following its temporary halt in the country due to a permitting issue.
2. Significantly lower cash burn
An even more important accomplishment for Aurora was that it significantly reduced its cash burn. The company used CA$154.5 million in its fiscal third quarter, down from nearly CA$273 million in the previous quarter.
Aurora's executive chairman and interim CEO Michael Singer has led the company to make some drastic cuts to spending. In February, the cannabis producer reduced the size of its workforce and slashed capital spending. Those actions made a difference in Q3.
There was one area where spending was higher in the third quarter than in the previous quarter, though. Aurora's interest expense nearly tripled to CA$15.9 million. The company added CA$22 million in debt during the quarter. Its total debt from borrowing now stands at over CA$246 million.
3. On track on all its key metrics
Aurora's management team focuses mainly on six key metrics to manage the business. The company was on track on every one of these metrics during Q3, a big improvement from its dismal performance in the second quarter.
Arguably, the most important of these prioritized metrics is adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) profitability. Aurora reported an adjusted EBITDA loss in Q3 of CA$45.9 million, excluding one-time termination costs related to its staff reduction. While still not anywhere close to being positive, this result trended in the right direction from the company's Q2 adjusted EBITDA loss of CA$80.3 million. Aurora still expects to achieve positive adjusted EBITDA in the first quarter of fiscal 2021, which ends on Sept. 30, 2020.
In addition, Aurora maintained its market share leadership position in key categories. It generated adjusted gross margin before fair value adjustments on cannabis net revenue of 54%. It was on track to meet its goal of reducing selling, general, and administrative expenses, as well as capital expenditures. And as already mentioned, the company significantly reduced its cash burn.
Ready to rebound?
So everything is now all sunshine and roses for Aurora Cannabis with the marijuana stock ready to rebound in a major way over the next few months, right? Not so fast.
There are some reasons for cautious optimism. Aurora's cost-cutting moves are helping. The launch of a value cannabis brand appears to have been a good move. The Cannabis 2.0 market should pick up momentum, especially if concerns ease about the COVID-19 outbreak.
But Aurora continues to lose a lot of money. Not mentioned above is the company's Q3 net loss of CA$137.4 million, or CA$1.37 per share. That's much worse than the net loss of CA$0.77 that analysts were expecting. And even with Aurora's lower rate of cash burn, it still used over CA$150 million of cash in the last quarter.
The company likes to stress its path to achieving adjusted EBITDA profitability, but that's not the same thing as actual profitability. The company ended Q3 with CA$230.2 million in cash, thanks mainly to CA$206.5 raised through an at-the-market offering. It's a foregone conclusion that Aurora will need to raise more cash in the future. That means more dilution is on the way.
Aurora's situation looks better now than it did a few months ago. However, the company still has a long way to go.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Keith Speights has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | There's one number that stands out the most for Aurora Cannabis (NYSE: ACB) over the last 12 months -- 92%. The huge jump in international revenue stemmed from Aurora's resumption of operations in Germany following its temporary halt in the country due to a permitting issue. Aurora's executive chairman and interim CEO Michael Singer has led the company to make some drastic cuts to spending. | There's one number that stands out the most for Aurora Cannabis (NYSE: ACB) over the last 12 months -- 92%. Aurora's actual net revenue in Q3 totaled CA$78.4 million, excluding provisions of CA$2.9 million, easily blowing past expectations. Its consumer cannabis revenue jumped 24% from the prior quarter to CA$41.5 million (excluding provisions). | There's one number that stands out the most for Aurora Cannabis (NYSE: ACB) over the last 12 months -- 92%. Aurora's actual net revenue in Q3 totaled CA$78.4 million, excluding provisions of CA$2.9 million, easily blowing past expectations. Canadian medical cannabis net revenue rose 6% quarter over quarter to CA$27 million. | There's one number that stands out the most for Aurora Cannabis (NYSE: ACB) over the last 12 months -- 92%. Canadian medical cannabis net revenue rose 6% quarter over quarter to CA$27 million. The company's launch of its Daily Special value brand in February, along with sales of cannabis derivative products in the Cannabis 2.0 market, were the primary drivers of Aurora's consumer revenue growth. |
37514.0 | 2020-05-15 00:00:00 UTC | 10 High-Risk Stocks That Could Go Either Boom or Bust | ACB | https://www.nasdaq.com/articles/10-high-risk-stocks-that-could-go-either-boom-or-bust-2020-05-15 | nan | nan | InvestorPlace - Stock Market News, Stock Advice & Trading Tips
High-risk stocks leave a sour taste with most seasoned investors. When someone says a stock is “high risk,” everyone grimaces. High risk? Who wants that? Give me low risk every day of the week! It’s a common perception of high-risk stocks, but it misses one very important truth about financial markets: risk and reward are closely correlated. That is, where there’s risk, there’s also reward.
Does that mean you should go out and form an aggressive portfolio of stocks in hopes of maximizing reward? Not exactly. You should still avoid risky stocks … for the most part.
That said, every once in a while, a stock plump with risk is worth rolling the dice on. Specifically when the odds are favorable and the upside potential is just that compelling.
30 Stocks on a Deathwatch
With that in mind, let’s take a closer look at 10 high-risk stocks which could go either way over the next few years:
High-Risk Stocks: Aurora (ACB)
ACB)" width="300" height="169">
Source: Shutterstock
Why It Could Go Boom: Leading Canadian cannabis producer Aurora (NYSE:ACB) could explode higher over the next few years, if two things happen.
First, the Canadian and global cannabis markets have to start growing concurrently and at a healthy pace, which seems entirely doable considering how policy globally is changing and the amount of new products coming to market.
Second, Aurora has to avoid bankruptcy and improve its profitability profile, which also seems entirely doable with the company’s near-$500 million cash position and recent cost-cutting initiatives.
Why It Could Go Bust: Aurora stock could go bust — and go to zero — if the company doesn’t leverage improving cannabis market dynamics and cost-cutting initiatives to drive the company into profitable territory soon.
The balance sheet can withstand sustained for losses for a little while longer. But not much longer. And if the company doesn’t turn a profit soon, insolvency risks will be magnified, and ACB stock will keep plunging.
Stage Stores (SSI)
SSI)" width="300" height="169">
Source: LM Photos / Shutterstock.com
Why It Could Go Boom: In 2019, antiquated and depressed department store operator Stage Stores (NYSE:SSI) committed to converting all of its full-price Stage Stores locations into off-price Gordmans. The idea is that off-price physical retail has a future while full-price physical retail does not.
The transition began to bear promising fruit in late 2019. If this transition continues with equally robust momentum in 2020, Stage Stores’ deteriorating revenue and profit trends could turn around in a big way, and SSI stock could turn into a multi-bagger.
Why It Could Go Bust: Point blank, Stage Stores may not have the money to pull off the turnaround. The company had a weaker-than-expected holiday season. This pressured what was an already significantly stressed balance sheet. Now, amid the coronavirus pandemic, the company has been forced to close all of its stores. This only worsened Stage Stores’ financial straits.
20 Stocks to Buy If You’re Still Betting on America to Thrive
Coming out of this crisis, Stage Stores may not have the capital necessary to keep the lights on, let alone pull off hundreds of off-price store conversions. If they don’t, bankruptcy becomes a real option for this depressed retailer.
High-Risk Stocks: Luckin Coffee (LK)
LK)" width="300" height="169">
Source: Keitma / Shutterstock.com
Why It Could Go Boom: Chinese retail coffee house operator Luckin Coffee (NYSE:LK) is what growth stories are made of. The so-called Starbucks of China operated less than a dozen coffee houses in China by 2017’s end. Today, Luckin’s coffee flows through more than 4,500 stores!
If Luckin’s robust growth continues — and if Chinese consumers increase their coffee consumption — then Luckin could sustain its huge growth numbers for several years. If it does, LK stock will soar.
Why It Could Go Bust: Let’s not forget, Luckin overstated its transaction volume by about 70% in 2019, meaning its red-hot growth narrative isn’t as hot as the Street believed. Luckin now has two big problems: legal problems and credibility problems.
On the legal front, lawsuits will come down against Luckin, and the company may not have the financial resources to deal with all those lawsuits and remain solvent. Even if it does, the company will come out the other side with a huge credibility problem.
It will take a long time before investors trust Luckin’s numbers again (if they ever do). This lack of trust could weigh on the stock for the next few quarters, even if lawsuits don’t drag the stock to the graveyard.
Bed Bath & Beyond (BBBY)
BBBY)" width="300" height="169">
Source: Jonathan Weiss / Shutterstock.com
Why It Could Go Boom: There’s a new and capable chief executive officer over at Bed Bath & Beyond (NASDAQ:BBBY) — former Target (NYSE:TGT) executive Mark Tritton.
Under his leadership, Bed Bath & Beyond could execute an omnichannel-commerce-powered turnaround over the next few years, similar to the one that Target executed over the past few years.
That turnaround propelled huge gains in Target’s stock. And it wasn’t priced for bankruptcy. Bed Bath & Beyond stock is. Thus, a Triton-led turnaround in Bed Bath & Beyond over the next few years could propel enormous gains in BBBY’s stock.
Why It Could Go Bust: The coronavirus pandemic has put tremendous pressure on retailers of all shapes and sizes. Bed Bath & Beyond is no exception.
The company was already cash-strapped to pull off a turnaround before the pandemic. Now, Bed Bath & Beyond is more cash-strapped than ever before. That doesn’t bode well for the company’s chances to successfully pull off a 2020 turnaround.
10 Stocks to Buy to Weather the Recession
If Triton doesn’t pull of this turnaround soon, then bankruptcy will become a real risk for Bed Bath & Beyond in late 2020 or early 2021.
High-Risk Stocks: New Age Beverages (NBEV)
NBEV)" width="300" height="169">
Source: Shutterstock
Why It Could Go Boom: The fundamentals supporting New Age Beverages (NASDAQ:NBEV) could meaningfully improve in 2020. Demand trends could improve in a big way as the company’s increasingly relevant drink portfolio of low-calorie, organic drinks gains wider national distribution. Think partnerships with the likes of Circle K, 7-Eleven and Walmart (NYSE:WMT).
Margin trends could simultaneously improve with scale and reduced reliance on marketing spend. If so, New Age Beverages’ profits could trend up in a big way this year. If they do, NBEV stock will take off like a rocket ship.
Why It Could Go Bust: The global beverage market is a tough one. It’s riddled with fickle demand, very little brand loyalty and a ton of reliance on distribution.
In that tough market, New Age is one of its smaller, less-established players. Management knows they have to spend big to grow big. If the aforementioned distribution partnerships don’t pan out, then spending growth will continue to outpace revenue growth, and New Age’s profit trends will remain depressed.
If that happens, NBEV stock will remain similarly depressed.
GameStop (GME)
Source: Shutterstock
Why It Could Go Boom: The conventional wisdom on Wall Street is that physical video game retailer GameStop (NYSE:GME) is doomed to follow in the footsteps of Blockbuster. But that may not happen if the company successfully crafts a niche for itself in hardware and digital software.
If the company can do that, then GameStop will have enormous upside potential over the next decade as the video game market booms alongside next-generation technological advancements, like 5G and AR/VR.
Why It Could Go Bust: Of course, GameStop could also end up just like Blockbuster. The invention of cloud gaming may altogether eliminate hardware video game sales, outside of accessories such as controllers and headsets.
10 Stocks to Pick Up If We’re Heading for Another Great Recession
That’s a tiny market, and not one that can sustain GameStop’s current expense base. Also, the pivot to digital could run into some obstacles, mostly related to competition. If the physical business continues to decline and its digital business stalls, GameStop’s stock price will wither away.
High-Risk Stocks: Jumia (JMIA)
Source: Christopher Penler / Shutterstock.com
Why It Could go Boom: The last frontier of the global e-commerce revolution is Africa, which houses about 15% of the world’s population yet accounts for less than 1% of global e-commerce sales.
Jumia (NYSE:JMIA) is trying to be the Amazon (NASDAQ:AMZN) of Africa. If they succeed in this mission, and leverage native logistics to turn into the backbone of Africa’s e-commerce market, then the company has tremendous revenue and profit growth potential over the next decade.
Inevitably, all of that growth will power JMIA stock higher.
Why It Could Go Bust: It remains to be seen whether or not the Africa e-commerce market is actually ready to boom. It also remains to be seen whether Jumia has what it takes to be the Amazon of Africa. Consequently, there’s simply a lot of unknowns here. So long as those unknowns stick around, JMIA stock will likely remain under pressure.
iRobot (IRBT)
Source: Grzegorz Czapski / Shutterstock.com
Why It Could Go Boom: Household robotics company iRobot (NASDAQ:IRBT) — best know for its robotic vacuum cleaning line under the Roomba brand — is a pure-play on the household robotics revolution.
If this revolution kicks into second-gear in the 2020s, and every household across America adopts a robotic vacuum cleaner, then iRobot’s growth trajectory will soar in coming years. It’s also worth noting that innovative product launches, such as a robotic lawnmower, could help supercharge the company’s growth narrative.
Suppose iRobot does sell a lot of robotic vacuum cleaners and lawnmowers over the next three to five years. If so, beaten-up IRBT stock could rebound by more than 100% to its all-time highs.
Why It Could Go Bust: Robotic vacuums may ultimately prove to be a niche market. Robotic lawnmowers, too. And all household robotics for that matter. If so, iRobot won’t sell a lot of product over the next several years. Any product the company does sell, will have to be discounted to compete in what has become a crowded market. Gross margins will get whacked and profit trends will remain depressed.
5 Streaming Stocks to Buy Right Now for Big Long-Term Gains
If all that happens, then IRBT stock will remain a bust.
High-Risk Stocks: Express (EXPR)
Source: Helen89 / Shutterstock.com
Why It Could Go Boom: A newly unveiled turnaround plan lays the groundwork for Express (NYSE:EXPR) to become a slimmer, more profitable retailer over the next few years.
Specifically, in the early 2020s, management is aiming to cut the store base, reduce operating expenses, double-down on the digital business and rationalize the product SKU to be more relevant. In so doing, management hopes to turn Express into a smaller, more profitable and sustainable retailer.
That retailer will come with a far higher stock price than the Express of today fetches.
Why It Could Go Bust: If the turnaround plan doesn’t work, the graveyard could be Express’ next stop.
The company has a strong balance sheet. But if it can’t turn a profit or grow sales, then that strong balance sheet will weaken over time. That’s especially true since the company is pouring resources into this turnaround. If the turnaround doesn’t yield meaningfully positive results, Express will have less financial firepower to deploy at additional changes.
All in all, then, if Express can’t turn into a slimmer, more profitable retailer over the next few years, the company may join a long list of retailers who have gone under since 2010.
Groupon (GRPN)
Source: Shutterstock
Why It Could Go Boom: Interestingly enough, Groupon (NASDAQ:GRPN) made the perfect pivot at the perfectly wrong time.
In late February, the company announced that it was going to wean off of product-driven promotions to rely more heavily on experience-driven promotions. That’s the right move. But, less than a month later, the whole world shut down thanks to Covid-19. In that shutdown, experience-driven promotions became worthless.
If the Covid-19 storm passes soon, and Groupon weathers it without declaring bankruptcy, then this company could leverage its experience-driven pivot to drive a huge second-half rebound in revenues and profits. That rebound would result in huge gains for GRPN stock.
Why it Could go Bust: Groupon may not make it to the second-half of 2020 to see its experience-driven pivot through to the end.
That is, the company’s financial resources may get sapped by the coronavirus pandemic, and force the company to shut its doors. Even if that doesn’t happen, there’s a risk that the hit to the experience economy in the second-half of 2020 will weigh on Groupon’s business.
Either way, the path forward for Groupon is littered with risks.
10 of the Best Long-Term Stocks to Buy in This Bear Market
To sum it up, these are 10 high-risk stocks could go either boom or bust in the next few years:
Aurora
Stage Stores
Luckin Coffee
Bed Bath & Beyond
New Age Beverages
GameStop
Jumia
iRobot
Express
Groupon
Luke Lango is a Markets Analyst for InvestorPlace. He has been professionally analyzing stocks for several years, previously working at various hedge funds and currently running his own investment fund in San Diego. A Caltech graduate, Luke has consistently been recognized as one of the best stock pickers in the world by various other analysts and platforms, and has developed a reputation for leveraging his technology background to identify growth stocks that deliver outstanding returns. Luke is also the founder of Fantastic, a social discovery company backed by an LA-based internet venture firm. As of this writing, he was long LK and AMZN.
The post 10 High-Risk Stocks That Could Go Either Boom or Bust appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | 30 Stocks on a Deathwatch With that in mind, let’s take a closer look at 10 high-risk stocks which could go either way over the next few years: High-Risk Stocks: Aurora (ACB) ACB)" width="300" height="169"> Source: Shutterstock Why It Could Go Boom: Leading Canadian cannabis producer Aurora (NYSE:ACB) could explode higher over the next few years, if two things happen. And if the company doesn’t turn a profit soon, insolvency risks will be magnified, and ACB stock will keep plunging. If they succeed in this mission, and leverage native logistics to turn into the backbone of Africa’s e-commerce market, then the company has tremendous revenue and profit growth potential over the next decade. | 30 Stocks on a Deathwatch With that in mind, let’s take a closer look at 10 high-risk stocks which could go either way over the next few years: High-Risk Stocks: Aurora (ACB) ACB)" width="300" height="169"> Source: Shutterstock Why It Could Go Boom: Leading Canadian cannabis producer Aurora (NYSE:ACB) could explode higher over the next few years, if two things happen. And if the company doesn’t turn a profit soon, insolvency risks will be magnified, and ACB stock will keep plunging. High-Risk Stocks: Luckin Coffee (LK) LK)" width="300" height="169"> Source: Keitma / Shutterstock.com Why It Could Go Boom: Chinese retail coffee house operator Luckin Coffee (NYSE:LK) is what growth stories are made of. | 30 Stocks on a Deathwatch With that in mind, let’s take a closer look at 10 high-risk stocks which could go either way over the next few years: High-Risk Stocks: Aurora (ACB) ACB)" width="300" height="169"> Source: Shutterstock Why It Could Go Boom: Leading Canadian cannabis producer Aurora (NYSE:ACB) could explode higher over the next few years, if two things happen. And if the company doesn’t turn a profit soon, insolvency risks will be magnified, and ACB stock will keep plunging. Why It Could Go Bust: Aurora stock could go bust — and go to zero — if the company doesn’t leverage improving cannabis market dynamics and cost-cutting initiatives to drive the company into profitable territory soon. | 30 Stocks on a Deathwatch With that in mind, let’s take a closer look at 10 high-risk stocks which could go either way over the next few years: High-Risk Stocks: Aurora (ACB) ACB)" width="300" height="169"> Source: Shutterstock Why It Could Go Boom: Leading Canadian cannabis producer Aurora (NYSE:ACB) could explode higher over the next few years, if two things happen. And if the company doesn’t turn a profit soon, insolvency risks will be magnified, and ACB stock will keep plunging. Why It Could Go Bust: Aurora stock could go bust — and go to zero — if the company doesn’t leverage improving cannabis market dynamics and cost-cutting initiatives to drive the company into profitable territory soon. |
37515.0 | 2020-05-15 00:00:00 UTC | Stocks Rise in Volatile Session | ACB | https://www.nasdaq.com/articles/stocks-rise-in-volatile-session-2020-05-15 | nan | nan | U.S. stock indexes hovered around the break-even line on Friday after recovering early losses, managing to close slightly higher.
Futures were deeply negative before the opening bell in response to a report that the U.S. is blocking microchip shipments to Huawei, as well as news that U.S. April retail sales declined even more than expected. But less than an hour after trading began, the Dow Jones Industrial Average had turned positive. It spent the rest of the day close to even.
By the close, the Dow finished up 60 points, or 0.3%, while the S&P 500 added 0.4% and the Nasdaq Composite rose 0.8%.
Most of the day’s volatility occurred during the pre-market session. European stocks and U.S. futures had initially climbed after investors were encouraged by signs of a recovery in China after a late rally on Wall Street on Thursday. Chinese factory output surged a better-than-expected 3.9% in April as the country’s industrial sector returned to work following weeks of shutdown.
The upbeat mood rapidly shifted, though, as Reuters reported that the U.S. Commerce Department was taking steps to block shipments of semiconductors to Huawei. Stock futures turned red and stocks opened down.
The department is amending a rule to “strategically target Huawei’s acquisition of semiconductors that are the direct product of certain U.S. software and technology,” the news service said. The news added to fear of renewed U.S.-China tensions; earlier this week, President Donald Trump threatened to “cut off” the relationship with Beijing.
China, according to other reports, might respond by activating its “unreliable entities list.”
Shares of Qualcomm (ticker: QCOM) closed down 5.1% while Apple (AAPL) and Cisco Systems (CSCO) shares fell 0.6% and rose 1%, respectively, after the editor of China’s Global Times wrote that the country may retaliate if the U.S. halts microchip shipments to Huawei. China’s Shanghai Composite and Hong Kong’s Hang Seng indexes each slipped 0.1% on Friday.
In a second downbeat development, U.S. government figures showed that retail sales fell 16.4% in April, compared with the 11.4% drop economists expected. Last month may very well end up being the trough for retail sales, with stores in several states beginning to reopen in May.
https://asset.barrons.com/dynamic-insets/charts/cdc_d9d5dc8457156cb0c9c46297.json
The pan-European Stoxx 600 index rose 0.5% on Friday, while the German DAX ended the day 1.2% higher. The French CAC 40 gained 0.1% and the U.K.’s FTSE 100 added 1%.
BT was one of Europe’s sharpest risers Friday, climbing 5.4% on reports the telecom giant is in talks to sell a £20 billion stake in Openreach—the division that runs the U.K.’s broadband network. The company’s shares tumbled last week after it suspended dividends until 2022 to free up cash to invest in infrastructure.
Travel stocks rebounded sharply after heavy losses earlier this week. Cruise operator Carnival (CCL) climbed 4.2%, budget airline EasyJet (EZJ.UK) rose 3.2%, and hotel chain Intercontinental Hotels Group (IHG) added 1.1%.
J.C. Penney (JCP) shares soared 21.2% after plunging earlier on reports that the struggling department store chain will file for bankruptcy as soon as Friday. It was reported earlier this week that J.C. Penney was speaking with lenders about securing $450 million in financing for an expected bankruptcy filing.
Aurora Cannabis (ACB) shares popped 68.7% after the cannabis grower said it expects to be cash flow positive in the September quarter after March-quarter sales exceeded analysts’ expectations.
Applied Materials (AMAT) stock fell 4.4% after its profits fell short of expectations when it reported earnings on Thursday evening. The semiconductor equipment company gave no forecast for its performance this quarter.
Write to Nicholas Jasinski at nicholas.jasinski@barrons.com and Carleton English at carleton.english@dowjones.com
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Aurora Cannabis (ACB) shares popped 68.7% after the cannabis grower said it expects to be cash flow positive in the September quarter after March-quarter sales exceeded analysts’ expectations. Futures were deeply negative before the opening bell in response to a report that the U.S. is blocking microchip shipments to Huawei, as well as news that U.S. April retail sales declined even more than expected. European stocks and U.S. futures had initially climbed after investors were encouraged by signs of a recovery in China after a late rally on Wall Street on Thursday. | Aurora Cannabis (ACB) shares popped 68.7% after the cannabis grower said it expects to be cash flow positive in the September quarter after March-quarter sales exceeded analysts’ expectations. Futures were deeply negative before the opening bell in response to a report that the U.S. is blocking microchip shipments to Huawei, as well as news that U.S. April retail sales declined even more than expected. Stock futures turned red and stocks opened down. | Aurora Cannabis (ACB) shares popped 68.7% after the cannabis grower said it expects to be cash flow positive in the September quarter after March-quarter sales exceeded analysts’ expectations. Futures were deeply negative before the opening bell in response to a report that the U.S. is blocking microchip shipments to Huawei, as well as news that U.S. April retail sales declined even more than expected. China, according to other reports, might respond by activating its “unreliable entities list.” Shares of Qualcomm (ticker: QCOM) closed down 5.1% while Apple (AAPL) and Cisco Systems (CSCO) shares fell 0.6% and rose 1%, respectively, after the editor of China’s Global Times wrote that the country may retaliate if the U.S. halts microchip shipments to Huawei. | Aurora Cannabis (ACB) shares popped 68.7% after the cannabis grower said it expects to be cash flow positive in the September quarter after March-quarter sales exceeded analysts’ expectations. Futures were deeply negative before the opening bell in response to a report that the U.S. is blocking microchip shipments to Huawei, as well as news that U.S. April retail sales declined even more than expected. It spent the rest of the day close to even. |
37516.0 | 2020-05-15 00:00:00 UTC | Aurora Cannabis Inc (ACB) Q3 2020 Earnings Call Transcript | ACB | https://www.nasdaq.com/articles/aurora-cannabis-inc-acb-q3-2020-earnings-call-transcript-2020-05-15 | nan | nan | Image source: The Motley Fool.
Aurora Cannabis Inc (NYSE: ACB)
Q3 2020 Earnings Call
May 14, 2020, 5:00 p.m. ET
Contents:
Prepared Remarks
Questions and Answers
Call Participants
Prepared Remarks:
Operator
Good afternoon, everyone, and welcome to the Aurora Cannabis Third Quarter Fiscal 2020 Conference Call for the Three Months Ending March 31st, 2020.
Listeners are reminded that certain matters discussed in today's conference call or answers that may be given to questions asked could constitute forward-looking statements that are subject to the risks and uncertainties relating to Aurora's financial -- future financial or business performance. Actual results could differ materially from those anticipated in these forward-looking statements. The risk factors that may affect results are detailed in Aurora's Annual Information Form and other periodic filings and registration statements. These documents may be accessed via SEDAR and EDGAR databases.
I'd like to remind everyone that this call is being recorded today, Thursday, May 14, 2020. I would also like to note that we're conducting our today from our respective remote locations. As such, there may be brief delays, cross-talk or other minor technical issues during this call. We thank you in advance for your patience and understanding.
I would now like to introduce Mr. Michael Singer, interim Chief Executive Officer and Executive Chairman of Aurora Cannabis. Please go ahead, Mr. Singer.
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Thank you and good afternoon, everybody, for joining me on today's call. With me today is Glen Ibbott, our Chief Financial Officer.
I would like to start by extending my deepest gratitude to all of our employees who have worked incredibly hard to keep Aurora fully operational throughout the COVID-19 pandemic. More than ever, I am proud to work alongside the people who make this organization great. As we had stated, our number one priority has always been to keep our employees safe, and this continues to be the foundation of all of the decisions we make. The highest measures of safety are in force as we continue to operate and work to serve the many people who rely on our products in these challenging and unprecedented times.
I would like to first take a moment to address our response to COVID-19. Our facilities in Canada and internationally continue to be fully operational and we are working closely with local, national and international authorities to ensure we are following or exceeding the stated guidelines within each region. We have taken extensive measures to maximize the safety of our employees who have been designated essential workers in Canada and to whom we are incredibly grateful. These measures include reorganizing physical layouts, adjusting schedules to improve physical distancing, implementing extra health screening measures for employees and applying rigorous standards for personal protective equipment. We have also introduced a special bonus pay program for active facility-based staff, and we continue to maintain regular communication with government representatives, suppliers, customers and business partners to identify and monitor any potential risks to our ongoing operations.
Turning to the quarter, while COVID-19 will likely have a greater effect on Q4, it did not materially disrupt our business in Q3. The production and sale of cannabis has been recognized as essential services across Canada and Europe, and consumer cannabis sales are primarily with government bodies, which continue to offer end customers online ordering and home delivery, and consumer market retail stores are generally permitted to remain open, subject to a hearing to the required social distancing measures.
With that said, we are pleased to report that our cannabis net revenue, excluding provisions, increased 15% over the prior quarter to CAD72.6 million. We maintained a leading cannabis market share in key consumer categories, continue to lead the Canadian medical market, and we have significant share in Germany. Our focus is to continue to gain market share and we remain well-positioned to capture more share of the revenue growth in key categories over time. We continue to leverage our coast-to-coast supply agreements to offer a broad range of premium consumer and medical products across Canada. In the third quarter, the number of total active registered patients exceeding 86,000 was a slight decrease compared to the second quarter, which in the face of market challenges demonstrates the value of Aurora's products and patient loyalty to the Aurora family of brands.
We are pleased with the progress we made on our Business Transformation Plan that we announced in February. As a reminder, that plan detailed our intention to better align the business financially with the realities of the current cannabis market in Canada. Success here will allow us to conserve resources and still position Aurora to build a sustainable growth platform longer-term. As part of this reset, we committed to an SG&A run rate of CAD40 million to CAD45 million per quarter by the end of the fiscal fourth quarter of 2020 and also stated our intention to reduce capital expenditures for the second half of fiscal 2020 to below CAD100 million.
Let me take SG&A first. For Q3, we had roughly CAD80 million of SG&A expenses, slightly over CAD5 million of R&D expense. After adjusting for severance costs, this represented a material reduction of 24% or roughly CAD26 million from Q2. Results would have been even better for the period, but many cost reduction initiatives were only initiated midway through the third quarter based on our transformation plan as announced on February 6. Therefore, a number that's more important and the one that you should all pay attention to is CAD60 million, which is our current SG&A and R&D run rate today in Q4. This is about a 45% reduction from Q2. To achieve these savings, we targeted non-core initiatives, which Glen can speak to, with reductions also realized from certain divestitures that carried heavy SG&A burden. This progress is very encouraging, and we feel very confident reiterating our intent to manage the business to an SG&A run rate of between CAD40 million and CAD45 million as we exit the fourth quarter.
Now, turning to capex, which was another main pillar of our Business Transformation Plan. We committed to reduce spending to below CAD100 million for the second half of fiscal 2020. We are pleased to report that we are on track to achieve that goal. This significant reduction in cash outlay really highlights the focus of our team in terms of achieving our goals and underscores the fact that we are viewing all capital spending through the filter of generating near-term revenues and preserving financial flexibility.
Another important takeaway here is that we have approved capital spending plans of less than CAD25 million for the fourth quarter, which includes LP license amalgamations, the completion of the joint venture arrangement to co-locate treatment within our Polaris facility and the completion of the first six rooms at Aurora Sun to produce high demand cultivars. All of these projects are expected to be largely complete in the fourth quarter, allowing first quarter 2021 capex to be well below fourth quarter 2020 levels, another key takeaway.
In summary, since announcing the Business Transformation Plan at the beginning of February, the team at Aurora has taken a number of concrete steps to put the company firmly on track to meet or exceed our previously announced targets. These steps are designed to strengthen Aurora's balance sheet and reduce go-forward cost to fuel profitability and positive cash flow. And while revenues in this current operating environment can be difficult to predict, we believe there are cost levers at our disposal to put us on a path to be EBITDA positive in Q1. We remain optimistic about our future growth potential in Canada and international.
With that overview, I'd like to now turn the call over to Glen, who'll discuss our Q3 financial highlights in more detail. I will then provide a brief update on our long-term growth initiatives, then we'll open up the line to questions. Glen?
Glen Ibbott -- Chief Financial Officer
Thanks, Michael. Good evening, everyone. Firstly, I would like to echo Michael's comments in thanking our employees who have done a tremendous job of navigating our Company through the complications of this pandemic. It is this level of commitment that demonstrates why we are all proud to be on the Aurora team.
With that said, I'll now spend a few minutes reviewing our financial results for Q3 2020. Of course, the figures I'll be going over today can be found in our financial statements and MD&A, and they're all in Canadian dollars unless otherwise stated.
For our third quarter, the period from January 1st to March 31, 2020, we saw our net revenue, excluding provisions of CAD2.9 million, come in at CAD78.4 million. Our total cannabis net revenue excluding provisions came in at of CAD72.6 million for the quarter.
To get into a bit more detail. During the third quarter, our Canadian medical cannabis net revenue was CAD27 million, up from CAD25.6 million last quarter. Our patient base exceeded 86,000, which although down slightly quarter-over-quarter, is indicative of our strong medical position, as that market faces continued headwinds from cannibalization into consumer market and also challenges with prescription renewals as many patient aggregators move to an online model during the pandemic. We continue to work at maintaining and growing our market-leading position and maximizing the lifetime value of our key patients. The good news is that, to-date in Q4, Canadian medical revenues remain steady.
Our international medical sales increased from CAD1.8 million in the second quarter to CAD4 million in Q3. Due to the resumption of sales operations in Europe in February following an administrative permit issue in Germany, similar to the Canadian market, we expect our European business, particularly in Germany to grow sequentially, but in the short-term with modest expectations. With the EU GMP certification, our Company received in February at our River facility, which has the capacity of approximately 30,000 kilograms annually, we are able to allocate significantly more product to our export market as they develop.
Consumer cannabis net revenue excluding provisions was CAD41.5 million, up 24% from the prior quarter. In Q3, we did record a provision of CAD2.9 million against revenue, which captured the impact of actual unexpected returns on price adjustments for sales in the prior quarters. The significant majority of this provision is related to products sold in calendar 2019.
During the previous quarter, Q2, we did see a drop-off in our market share in flower as the market shifted significantly toward value brands, which we define as retailing for less than CAD9. In February, we launched our competitive brand in this category, Daily Special at a price point, average potency and pack sizes that we think are a very compelling proposition for the consumer. In fact, we believe it competes well with the gray market and will help grow the overall size of the legal segment. We'll clearly be monitoring our performance here closely.
Data from Ontario indicates the Daily Special that's the top selling flower brand in March and April and that Aurora brands have the leading market share in flower and overall. While Ontario retail sales have been impacted by the government mandated move to curbside pickup, we are pleased with today's announcement that Ontario retail stores with outside entrances will be allowed to reopen fully as soon as next week.
Our average Q3 net selling price for consumer cannabis of CAD4.33 per gram represented, a decrease from the CAD4.76 recorded in the prior quarter, again primarily attributable to the impact of the lower average pricing of Daily Special in the value segment. The medical Cannabis average ASP increased a couple of percent as our German sales came back on line.
In the quarter, we produced over 36,000 kilograms of Cannabis. This is, as compared to approximately 31,000 kilograms prior quarter. With our facilities fully scaled up, we have focused the last several quarters on optimizing the performance of these facilities. For instance, our top quality flower, which has strong market demand in segments San Rafael and Daily Special, now represents approximately three quarters of Sky production, up from just over 50% several quarters ago.
Our forecast for inventory drawdown shows that our top quality flower production versus sales will reach a steady cadence over the next several quarters and our mid-quality and flower will take slightly longer than that for steady state and drawdown. Growth in product categories like the value segment that Daily Special leads are a high volume site and required a scale and top quality flower that our facilities are now delivering.
Taking a production for a minute, we also continued to innovate operationally, both in efficiencies and in cultivation. For example, plant R&D with potential new high-THC cultivars is progressing nicely with several cultivar candidates showing both high yield and delivering consistently above 20% THC.
Our cash costs to produce per gram of dried cannabis improved to CAD0.85 per gram, down CAD0.03 from the previous quarter. We are pleased that we continue to deliver on a very important key metric for our operations, sub CAD1 cash cost to produce. This is the leverage that allows us to launch such a powerful inventory into value market while maintaining strong, healthy and sustainable margins.
In Q3, we had CAD80.1 million of SG&A expense and CAD5.6 million of R&D expense. As Michael noted, SG&A included CAD5 million of onetime termination costs related to our reset. After adjusting for these severance costs, SG&A and R&D combined declined about CAD26 million or 24% in the second quarter, again reflecting the partial quarter impact of decisions taken in February. But more importantly, our current run rate for SG&A is below CAD55 million and for R&D at approximately CAD5 million.
Our reset was meant to bring focus to the organization on the parts of our business that will deliver meaningful short and long term volumes, as such we reduced expenses across the board, including cancelling or delaying numerous information technology projects, elimination of projects that require significant external professional fees, renegotiation of several key marketing or research contracts, reduction in certain marketing programs, and the elimination of headcount across all of the SG&A functions. Expenses were also reduced as a result of the divestiture of several noncore subsidiaries that had low gross margins and carried a heavy SG&A burden.
This progress demonstrates our commitment to manage Aurora's positive EBITDA for Q1 2020, including a run rate of CAD40 million to CAD45 million SG&A, which balances R&D [Phonetic], as we exit the fourth quarter of 2020. As noted earlier, this reset is particularly important in the context of the current COVID-19 environment. While the near term growth of the consumer market is difficult to predict, we can control our production and SG&A costs.
Looking forward, as an example, further reductions will come from completion of several projects by the end of June 2020, including the amalgamation of our four separate licensed producer legal entities held by Aurora, MedReleaf and CanniMed. We anticipate that this will provide for significant sale, fulfillment and SG&A efficiencies. Another example of cost reduction is the completion of our year one Sarbanes-Oxley implementation, which has consumed significant efforts and external expense in current fiscal year. And finally, we do anticipate further SG&A reductions as we complete the profitability review of several parts of our business.
Capex, so, as Michael described, we committed to reducing capital investment to below CAD100 million in the second half of fiscal 2020 and remain on track for that. Q4 capital expenditures are approved at less than CAD25 million. As we stated on our February call, all capital spending was reviewed with parameters of generating near-term returns, a focus on our core businesses, and the preservation of financial resources.
Turning to our balance sheet. As of March 31st, our consolidated cash position was CAD230 million compared to CAD156 million as of March 31, 2019. We reduced cash use in Q3 by over CAD118 million from the prior quarter to just under CAD155 million in Q3. We used about CAD55 million of that cash to fund operations, CAD84 million for capital spending. We had a lot of invoices to pay in Q3 [Phonetic] and made debt and interest payments for about CAD16 million. We were relatively neutral on working capital with CAD35 million increase in inventory in biological assets offset by accounts receivable, accounts payable changes.
So, given the continued healthy adjusted gross margins, the reductions in SG&A expense and capital expenditures as described above, we expect cash used in Q4 operations and capex to decrease significantly from Q3. In Q3, we raised approximately CAD206 million under our at-the-market financing program. And subsequent to the quarter end, we filed a new perspective supplement to enable us to raise an additional US$250 million under this program.
In this environment, we believe that access to capital is a paramount importance for the Company and our shareholders. As we have demonstrated with our progress on the operational reset, we continue to prudently manage our liquidity as we remain on track for EBITDA profitability in the first quarter of fiscal 2021. The material run rate reduction in our capex and SG&A costs should provide comfort to our investors that we are laser-focused on the health of our income statement and balance sheet. We expect that our current cash position should be sufficient to fund operations and remaining capital expenditures, requiring for positive EBITDA and free cash flow are achieved and sustainable. The ATM capacity protects the Company and our shareholders as a backstop in a very uncertain environment.
I would now like to take a moment to summarize our short-term outlook. The variables associated with COVID-19 pandemic and the still developing Canadian consumer market, including consumer buying behavior and new store rollout, have led Aurora to focus in the near-term on market share, rather than revenue targets to manage the business. While we've remained optimistic about the total accessible market size of Canadian consumer cannabis over time and we're pleased with our current market share and performance in key Canadians consumer markets, the variables described above, make the short-term growth of the market and our revenue expectations difficult to predict with an adequate degree of precision. As a result, we are not providing for quarterly guidance at this time. We are, however, reaffirming our commitment to manage the business to positive EBITDA in Q1 2020 using whatever additional cost levers we need to and have shown that we're well on track for that goal. Finally, earlier this week, we completed our previously announced plan to consolidate all of our outstanding common shares on the basis of 1 common share for every 12 common shares then outstanding.
I'll now turn the call back to Michael.
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Thank you, Glen. Driving Aurora to be a profitable and robust global cannabis company is extremely important to our team. Our goal is to manage the business with a high degree of fiscal discipline, especially in the midst of a global pandemic. And as our results suggest, we have made significant progress in February with more progress to come. But we also recognize that cost reduction can't be the only avenue to realizing our potential. In fact, as we execute our plan, we're still moving forward toward some larger goals. These include the development and implementation of programs that foster organizational success, a plan designed to increase revenues outside of Canada by prioritizing the most profitable international markets and a strategy to leverage the US market targeted toward opportunities that would importantly align with our key objectives of the stated reset plan.
Finally, before taking your questions, let me update you on our search for a permanent CEO. As announced back in February, the Board engaged a global search firm and launched a comprehensive search process. I can confirm today that this process has advanced nicely and we remain on track with both the selection and announcement of a new permanent CEO in the next few months.
Thank you for your time. I'd now like to ask the operator to open up the call for questions.
Questions and Answers:
Operator
Thank you. [Operator Instructions] Our first question is coming from Vivien Azer from Cowen and Company. Your line is now live.
Steve Schneiderman -- Cowen and Company -- Analyst
Hi. This is Steve Schneiderman pinch-hitting for Vivien today. Thanks for letting me ask my question.
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Hey, Steve.
Steve Schneiderman -- Cowen and Company -- Analyst
Hi. We appreciate the long-term strategic rationale for focusing on market share, given the uncertainty due to COVID. Certainly they'll help ensure that your brands remain dominant and relevant to support further access of the world when it returns to normal or a new normal. That said, how do you maintain the high degree of confidence on your profitability targets without having a more clear view of revenue development to solve operating leverage as a complement to your cost-cutting effort?
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Right. Thanks, Steve. And just background for everybody. Michael and I are 3,000 miles apart, hard to read body language. So, I'm going to field the questions and I'll kick them over to Michael [Indecipherable] that he takes from. So, Steve, thanks for the question. Listen, what we're trying to do is be realistic in this environment. We saw Ontario few weeks back also move to the curbside collection and now today announcing maybe even next week will allow kind of access to retail stores again. So, it's a very dynamic environment on the consumer side. We are confident in our medical business, we are confident in our international medical business, but we're trying to be real conservative, if you will on the consumer market in Canada. So, as we plan forward, we control -- and we can compete on market share, we can't compete -- we can't affect the growth of the market in terms of store counts and things like that. So, what we're trying to do is plan our business such that we have a track through to EBITDA profitability under pretty much any reasonable scenario in my division. So, to be crystal clear, we have operating target and SG&A targets, but we -- if we need to, we can pull additional cost levers within the business. We have committed to be EBITDA positive in Q1.
Steve Schneiderman -- Cowen and Company -- Analyst
Okay, great. Thank you very much. And on Daily Special, can you talk about how much of your volumes, what revenues came from the product and have you found this to be surely incremental or has there been some level of cannibalization between that and the core Aurora brand?
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Yeah. Thanks. So, listen, as we described on previous calls, we were already seeing a significant shift toward the value segment. And then the premium segment still seems to remain intact. And if you talk to Darren, who is in charge of our marketing, he'll say that the new core segment is the value segment. There's a -- the middle of the market there seems to have narrowed quite significantly. So, when we think about cannibalization, I'm not sure that we're actually seeing cannibalization. I think, we're just seeing shift to value with premium still playing well.
So, in our brands, we see San Rafael still strong, and we see the launch of Daily Special as being mainly incremental but also necessary to compete in what's now becoming a significant part of the market. Just a little further on Daily Special, Daily launched as I said at a strong price point, consistently high potency and larger pack sizes. So, I think what we're also starting to see, Steve, is some shift from the black market. These are at prices as far as we can tell are very competitive with the black market, and certainly pack sizes, which tends to receive larger demand for the 15 and 28-gram pack sizes.
Operator
Thanks. Our next question today is coming from Michael Lavery from Piper Jaffray. Your line is now live.
Michael Lavery -- Piper Jaffray -- Analyst
Thank you. I just was curious if you could dissect the quarter a little bit more. And you had mentioned last quarter, you thought sales might be a little more in line excluding allowances and certainly saw a pickup from that. Could you just give some sense of what the key drivers were relative to your expectations? And maybe how much of a part of the equation was the derivative 2.0 products?
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Yeah, sure. So, listen, yeah, our medical markets, both Canadian and international performed well, but in line with our expectations. The consumer market in Canada obviously was hard to predict. We did see what we think some pantry loading in March, with the pandemic and people starting to kind of stay-at-home and load up a little bit. But that was also -- in March, we also only saw the impact of our Daily Special. And in terms of data that we can see, in March, our Daily Special in Ontario had 9% of the flower market and that's coming from zero percent two quarters ago. So, we saw a couple of things kind of hitting, probably more successful than we had expected with Daily Special and certainly hope for, and some pantry loading in March. In April, we've seen a little bit of a reversion to the pre-pandemic sort of ordering levels. But I think that was relative to our expectations, March and particularly the latter part of March outperformed our expectations.
Michael Lavery -- Piper Jaffray -- Analyst
That's helpful. And just to follow up on Daily Special, can you give a sense -- it sounds like it's both performing better than you had thought. Obviously, some pantry loading as a part of that probably. But you also mentioned at the tail end of the prepared remarks about just how focused you are on market share. How do you think about this brand going forward? Is it one you might even consider pushing harder on price or is it positioned kind of the way you want? And when you say you're pushing, thinking -- willing or thinking about pushing harder on share, it's more of the same, just riding it out?
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
I'm really pleased and I'm quite honestly with -- I mentioned 9% in April, looks like it's close to 13% of the flower market in Ontario. So, we're pleased with the performance we need to protect -- our pricing seems to be pretty strong right now. There are entrants, but we're marketing, but we've seen increase in shares. So, no immediate issues with pricing. And as I said earlier, we think it's now a product in a number of different characterisitcs, very competitive with the black market. So, market share must be clear. We do have internal revenue targets there. Therefore, our sales team to strive to hit, but we plan the business over the next couple of quarters, we recognize that that's inherently difficult to predict. And so we just need to be cautious in the short-term. We need to protect that market share and then make sure that we right-size the business to get to EBITDA profitable. Thanks.
Operator
Thank you. Our next question today is coming from David Kideckel from AltaCorp Capital. Your line is now live.
David Kideckel -- AltaCorp Capital -- Analyst
Hi. Thanks for...
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Good afternoon.
David Kideckel -- AltaCorp Capital -- Analyst
...taking my question and congratulations on the quarter. I just want to go back for a second to your derivative products. I know, Glen, you mentioned in your prepared remarks that one of your top selling products San Rafael coming out of the flower side. But how should we think of derivative products just as an overall revenue mix, given just -- we're thinking about margins and how derivative products represent an overall margin share as compared to flower products?
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Yeah. So, a couple of things there I can start with and then Michael if he has got anything to add. 2.0 products, as you know, we launched across a broad series of categories in December, kind of first out of the gate, and we had most of the major categories with the exception of beverage in December. And we've learned since then, and we continue to pivot the organization to focus on those areas where we haven't yet seen. We're now running into the limits of demand, so certainly on base, but things are gummies as well. So, that's getting to be a crowded field, that 2.0. There are a lot of players. When I look at market share, say in Ontario, it's distributed, we're doing well but it is distributed across a number of products.
In terms of our portfolio right now, flower is still by far the dominant percentage of what we sell. And what we've seen in the state's more mature markets, that's going to continue to be the situation. We do expect 2.0 products grow over time. And certainly [Phonetic] we test, and we're scaling up a couple of them, the internal manufacturing capabilities on those products where we think there's considerable untapped consumer demand still. So, we try to test the limits of the demand. So, that's something that we'll continue to be nimble on, I think, Dave, over the next number of quarters as we learn more about the consumer.
David Kideckel -- AltaCorp Capital -- Analyst
Yeah. And I think that speaks well, as well. I mean, in your prepared remarks, you were mentioning how premium type products like San Rafael are doing well. Okay. That's helpful. My next question and last question, really shifting from Canada now to international. With COVID going on now, I get the EU GMP certification and German distribution, but over and above Germany -- and maybe Germany is included in this next question. How do you think overall medical cannabis with regulators across the world now is going? I mean is it slowed down? Has it been an increase? Like, what is the appetite for cannabis legalization, whether it's medical -- likely medical, or even recreational, but it's likely medical, just across the world now with COVID?
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Yeah. That's an interesting question and difficult to of course to know that how regulators are reacting to this. Listen, we haven't really seen any kind of slowdown in the business in Europe. In fact, the CAD4 million that we recorded in the quarter, remember, that's only a partial quarter for Germany. So, there was actually kind of a step forward for them when they came back in the business. And the only kind of real impact I've seen or that I'm aware of is just of course, when you're dealing with governments and regulators, and the people are working from home, the processes get slowed down. So, whether it's tenders in various countries have kind of slowed down. But I don't think any of us believe that the long-term momentum isn't still there. It's just short-term, taking longer to get people through regulars and that's probably true, but hasn't impacted our revenues currently. Thank you.
Operator
Thank you. Our next question is coming from John Zamparo from CIBC. Your line is now live.
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Hi, John.
John Zamparo -- CIBC Capital Markets -- Analyst
Great. Thank you very much. Good evening. I wanted to ask about the goal of getting the EBITDA positive by Q1 and specifically about -- on the Ontario store front. I mean, new growth has slowed significantly and existing stores are restricted, granted, you mentioned they may open next week. But does that create incremental risk on achieving your goal? And I appreciate all the color on Ontario performance. But can you talk to your performance outside of Ontario, late both in the quarter and subsequent?
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Yeah. I'll start with that and then maybe Michael can add. But, listen, when we talk about Ontario, it is one of the places -- one of the larger provinces where we actually got a complete data set that includes our competitors. We don't normally get that from other provinces [Indecipherable]. We and our peers tend to focus on data coming out of Ontario. We're doing well in the other provinces. We are quite satisfied with our performance in all the major provinces. So, my comments around Daily Special or sort of gummies and things like that. I think you can apply that across Canada where we believe we have leading share in most categories and most major provinces.
Sorry. Can you repeat the last part of your question?
John Zamparo -- CIBC Capital Markets -- Analyst
Sure. The Ontario store closures and restrictions, do you think it adds more risk to the EBITDA goal or is there enough levers on SG&A?
Glen Ibbott -- Chief Financial Officer
Yeah. So listen, as we kind of looked at Q1, we've got a plan to get the EBITDA positive. And if there's no growth, then there's a further plan. You said we'll pull more levers, we'll pull more levers if we need to get there. It's kind of one of those goals you just need to achieve. We thought we had a pretty healthy quarter. It was certainly a step forward and a bit of turnaround from the last couple of quarters and get positioned properly. We're just being cautious on the revenue line, as I said. But we do have a good solid base medical business, and one I think we've got consumer performances as well. So, we will monitor revenue. And if it looks like we need to do more, then we'll do more. But we certainly have a fair plan from here to Q1.
John Zamparo -- CIBC Capital Markets -- Analyst
Okay, thanks. And then, on the inventory side, just trying to square production versus sales, and I think this is probably true of the entire industry. But, you produced about 36,000 even with fairly material revenue growth and sold about 13,000. I know you gave some details on sales velocity. But, can you maybe elaborate on those? And more broadly, how should we think about your production versus sales over the next few quarters? Thank you.
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Yeah. So, a couple of things going on there. One thing, I mentioned briefly, but it's very important is that we have really been fine-tuning our facilities. And so, at Sky are producing a top quality flower. So, that with potency and consistent sort of experience for the consumer. And the sort of thing, you can put anything [Phonetic] into jar and deliver to a consumer. That coming out of Sky has gone from the mid-50s percentages up into the 70s percentages now, a huge shift in terms of turning out. The type of product that is in high demand, it goes into Daily Special. Key to Daily Special is delivering a great experience and a high potency, but at a very compelling price. So, it's been very important to have that shift. And so, the more of that -- we don't think we've seen anywhere near the top of that demand. So, it's been important to get more out.
So, as we look forward and project with those new efficiencies in place in terms of the type of product we're taking out of the organization, we see that there will -- we will get into that steady cadence of the volume sold versus the volume being produced on the top quality flower over the next couple of quarters and continue to drive down on that part of the inventory. For the stuff that goes in, into other products and sometimes it just may be still a smoke product or pre-roll, there is still quality but maybe smaller buds or trim, that'll take a couple more quarters to draw down the inventory and gain cadence. But, a lot of that will be related to the growth of 2.0 products as well.
So, we're satisfied with where we are at on that and paying close attention to it. But again, that change to producing the top quality flower has been very important for giving us confidence that this is product that will move out into the market in reasonable period of time. It's important for a play like Daily Special, with the high volume, low price, great experience play, we need to operate at volumes to get the scale efficiencies. It's kind of a stepwise function on costs and so, keeping the scale up keeps the costs to produce. So, it's pretty critical to begin right product [Indecipherable]
Operator
Thank you. Our next question today is coming from Pablo Zuanic from Cantor Fitzgerald. Your line is now live.
Pablo Zuanic -- Cantor Fitzgerald -- Analyst
Thank you.
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Hi, Pablo.
Glen Ibbott -- Chief Financial Officer
Hi, Pablo.
Pablo Zuanic -- Cantor Fitzgerald -- Analyst
Hi. Just one question. The way I try to interpret the market, when you announced your ATM in mid-April of CAD350 million, your stock took a hit, down 30% over the last month on the assumption that you would use all of it and you have about 30 or more percent dilution. Now, in the call today in your prepared remarks, you called it a backstop. So, can you -- just to clarify, and maybe I'm making you repeat what you said, if you are able to deliver in your cost-cutting targets and lower capex as you have and even if sales remain at a steady state where you are right now, you will need -- you will not need to tap that facility. I understand it's a rainy day facility. There's a lot of uncertainty out there. But your share price reflected pretty much 50% dilution from that ATM facility. So, just if you want to like maybe repeat or clarify that contrast? Thank you.
Glen Ibbott -- Chief Financial Officer
Let me address kind of a couple specific points and then Michael can talk kind of big picture with the way to think about the business. But yes, listen, I think because we've actually demonstrated to you and to the market that we've been able to reduce the cost structure of this organization significantly and the capex significantly and that we'll continue to do so, we've got more confidence of our ability to get to that EBITDA profitability, but more importantly cash flow positive over the near-term. So, as we sit here today, we believe the cash in hand should get us there. But, in this environment, we've seen it with all the major public companies and you've got to have access to capital. So, when we saw major companies pulling down on all their lines of credit and putting in bank, whatever, we believe that this is similar. So, I hear you, but I think we've got more confidence with the state of our business, as we stand here and having proven a number of things and having still pretty, I think, solid revenue performance. So, we do look at it as critical backstop in a very uncertain time.
But, Michael, maybe I think it's for just some big picture comments on the state of our business.
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Certainly. So, look, I think, consistent with what we had previously announced, and this is in advance of obviously our recently just refreshing of the current ATM. We had said as part of our reset that we were going to leverage the initial ATM to raise approximately CAD200 million in order to fund the gap of getting us to EBITDA profitability. And so, we still believe that could be the case today. And you saw that from our cash position that we just announced today, CAD230 million, we believe as noted by Glen that that is sufficient capital to get us to the right outcome.
We put in place the new ATM in April, really as a prudent measure in this environment. It's uncertain. We don't know the length of which COVID will continue to survive, but even though we don't expect that we will need to tap into that ATM, we have it there as a measure, just to protect the business and our investors, in the event that this uncertain environment continues for an extended period of time. So, we feel confident that we, I think are positioned well today. But I think, as good operators, we want to sort of protect the Company for the long-term. And I think putting that additional or refreshed ATM in place just gives us the added level of protection that gives us comfort that we can really aggressively advance our business based on the reset plan.
Pablo Zuanic -- Cantor Fitzgerald -- Analyst
Understood. That's very helpful. Just a quick follow-up. Obviously you're growing in the Canadian market and, Glen [Phonetic], you gave us the numbers. On international side, just going back there, can you frame the opportunity a year out? We're still hearing about only 60,000 patients in Germany. It seems that the main market overseas right now is Germany. All the players are focusing there. Right? Prices could compress. Just some color and context on even how to model that. I think in the Tilray call, they said that could be about 25% of our business. So, just some -- because you talked to a very high market share, but other people seem to be making similar claims with even more sales than what you are reporting. But just some more color, please. Thanks.
Glen Ibbott -- Chief Financial Officer
Well, yes, let's be clear, 25% of somebody's business, that's a small Canadian business, it's not the same as us, right? So we had CAD4 million of revenue in Europe for a partial quarter, I think, is one of the leading performances for Cannabis. I'm not talking about any other types of revenue. I'm talking about cannabis. So, our medical cannabis business internationally is strong. We all know, and this is different than a couple of years ago, but these are slower developing markets. But there are European markets that we're -- and I'm not going to predict revenues, but we are exporting into countries like Poland and those sorts of things that are new markets. Again, we're just going to be prudent and expect slow growth. And Latin America, you just see Brazil opening up, mainly a CBD medical market. But again, as Michael said, we're prudent with our capital. But certainly, any market, we can enter the market if a significant market opportunity and delivers near-term revenues and bottom line, so, no losses please, no capital that those markets we are looking at entering. But when you model these and definitely, I mean, I'm conservative with international stuff and I just expect some upside along the way. Thank you.
Pablo Zuanic -- Cantor Fitzgerald -- Analyst
Thank you.
Operator
Thanks. Our next question today is coming from Adam Buckman from Scotiabank. Your line is now live.
Adam Buckman -- Scotiabank -- Analyst
Hi. Good evening. Thanks for taking my question. So, I just wanted to dig a little deeper into the 2.0 market dynamics. So, it looks like you guys generated about CAD5.6 million in Cannabis 2.0 revenues in the quarter. It's been pretty highly televised that LPs have had issues keeping products on the shelves. So, first, could you touch on your manufacturing capacity in the 2.0 market and maybe how it's changed since you first launched, and then maybe how much of a drag that might have been in Q1 versus where it'll be in -- or calendar Q1 versus calendar Q2?
Glen Ibbott -- Chief Financial Officer
Yeah, I'll start first. So, listen, much like in the launch of 1.0, scaling up manufacturing processes is not without its challenges, and we certainly had those and continue to overcome them. What we've done though is we kind of did the launch I'd say prudently into number and then looked for consumer reaction to the types of products we're offering, pricing and things like that. What we're currently doing now is scaling up several categories, if you will, where we think there is significant consumer potential.
Michael, do you have any comments on the front of the 2.0 market and kind of where we're going in operations?
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Well, certainly. So, I guess what I can add is, look, as time goes on, we gain a greater level of knowledge in terms of demand and where we see the market going. And I think as Glen noted, we continue to optimize a very innovative product pipeline, And we're really going to focus on profitable SKUs and SKUs, certainly that are going to help what we believe to bridge the difference between getting the supply to meet demand. So, I think, we came out of the gate with a significant number of SKUs, just not knowing where we were going to see the consumer sort of, if you want, demand. We've learned a lot. And so, we're really taking those learnings and really going to refine that to areas where we truly see an opportunity for profitable SKUs going forward.
Adam Buckman -- Scotiabank -- Analyst
Okay. Thanks. And then, secondly, just on working cap. So, moving forward, I think you guys kind of indicated that you should see a level similar to this quarter. Could you maybe talk about the puts and takes from a working cap standpoint for the next couple of quarters? And how you're going to keep that in sort of the neutral sort of place that it was this quarter?
Glen Ibbott -- Chief Financial Officer
Yeah. So, listen, I think [Indecipherable] for us over the last couple quarters, if you will and driving -- working capital has been the build of inventory. So, as I described a little bit earlier, we do see -- certainly a brand like Daily Special consumes a lot more volume than say a San Rafael brand does, because it's at a much lower price point. So, it's a volume play and it's consuming more. So, I think, as we our consumption or the sales volume starting to normalize with our production, we'll start to see that inventory -- the investing in working capital or investing inventory starting to come down. So, that's kind of what we expect over the next couple of quarters. The rest of it, AP and AR is kind of stabilized now, collect from government and kind of reach steady cadence on that and pretty steady as well.
Adam Buckman -- Scotiabank -- Analyst
Okay. Great. Thanks.
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Thanks. Yeah.
Operator
Thank you. Our next question today is coming from John Chu from Desjardins Capital Markets. Your line is now live.
John Chu -- Desjardins Capital Markets -- Analyst
Hi, good afternoon.
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Good morning.
Glen Ibbott -- Chief Financial Officer
Hi.
John Chu -- Desjardins Capital Markets -- Analyst
So, I just want to kind of keep pressing on the levers that you have to reach the positive EBITDA. So, if the sales become weak because of COVID and the post-COVID situation, typically you're going to pull on those SG&A levers, but are you going to be cutting to the barebones to the point where at some point that SG&A level is going to have to bounce back to -- in order to draw growth going forward?
Glen Ibbott -- Chief Financial Officer
Yeah. So, that's a challenging question. Right? So, I think -- OK, personal opinion, we've seen quite an impact from COVID and have delivered some pretty good revenues. And as I said earlier in my remarks, medical sales still seem strong. We're just going to be cautious on the consumer side. So, I don't want to go too far on that. We will do what it takes to get to positive EBITDA. But, I have to tell you, I mean I'm not expecting that we would have to cut to a point where we put our long-term growth at risk, and that's not my expectation.
John Chu -- Desjardins Capital Markets -- Analyst
Okay. And just want to touch a little bit more on the 2.0. So, it sounds like you've got enough data then or you're comfortable that you have enough data accumulated to know what SKU you need to ramp up on. And you are doing that as we speak right now, or do you still need to collect a little more data to have a better understanding of that?
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
No, that's right. For the major categories, we know where we're doing quite well and where we think there's still significant demand. We haven't been able to find anywhere near the top of that demand. So, that is being ramped up right now. Some of it has been ramped up or at least scaled up some of those operations. There's a little bit more to come. So, some of the capital in Q4 was related to that. They're modest amounts, but they're still important in terms of turning out more of those product categories.
Operator
Thank you. And our next question today is coming from Graeme Kreindler from Eight Capital. Your line is now live.
Graeme Kreindler -- Eight Capital -- Analyst
Yeah, hi. Thanks for taking my question. Just one question here. Michael, you mentioned toward the end of the prepared remarks about other frontiers of growth, in particular you mentioned the US market. So, I was just wondering, I mean, we've seen a backdrop of a lot of your competitors scaling back investment in that market particularly on the CBD side if not sort of talking down expectation for entrance or how competitive they're looking to be in terms of their near medium-term. So I'm wondering when you mention that market, what sort of time horizon are you looking at as that -- for a potential avenue for growth? And does it extend keeping in mind that it would be something that has to be federally legal, is it just a CBD avenue there or is there potential other business streams where you could see growth there? Thank you.
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Well. Good question. I think, that's the market that is just -- and we've said this before -- just too big to ignore. So, we've got our eye on that market and we're continuing to explore opportunities that are going to be without a doubt have to sort of align with our reset plan and our stated objectives. We're limited in what we can do under the current environment in the US. So obviously it can't touch THC, but we see CBD as a tremendous growth opportunity, and it's something that I think we are a little more focused on. And so, looking for opportunities that we think would be complementary to our business certainly needs to be accretive.
And given our focus on our own balance sheet certainly has to be something where we are confident that we're not going to have to dig into our pocket to leverage that opportunity. So, I think we're excited about some of the opportunities where we're identifying. And I think, to your question about when we anticipate maybe potentially looking at an opportunity in the US, I would say, certainly this year is certainly a window of opportunity for us and it's something that I think we're more focused on than we had been historically, again with a lens on ensuring this have to fit in line that we are currently set in.
Glen Ibbott -- Chief Financial Officer
And then, just to add a little bit in terms of...
Graeme Kreindler -- Eight Capital -- Analyst
Okay. Thanks for that. Yeah. Sorry.
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
...your question about our competitors. Listen, unlike Canada where most of the LPs grew up playing in the entire value chain from cultivation and right through to distribution. That's not true. We don't need to do that in the US. And what I've seen, some people pulling back and saying well, why are we in hemp, where are we growing hemp, things that. So, just to kind of put this in context. Somebody's pulling back from the market, it may just be part of the value chain that doesn't necessarily make sense, if they've learned about the market. And we've certainly taken our time to understand that market thoroughly and understand where we think long term value can be created there and you don't need to play in the whole value chain?
Graeme Kreindler -- Eight Capital -- Analyst
Okay, thanks. And just a follow-up, when you're discussing the timing of this year being a window of opportunity, do you look at that under the assumption that the regulatory environment stays as is, which I would categorize it as kind of gray -- at the current moment in time or does that assume that you're going to see some incremental progress, either on the regulatory environment or just in terms of various points of distribution or certain states sort of jumping ahead of that and giving us some more clarity there? Thank you.
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
So, I guess, I'll take that Glen. So, I guess, we don't anticipate any material regulatory changes. So, I think the opportunities we're looking at are with the idea that we don't expect those changes to occur certainly in 2020. And I think the thinking there is, we're exploring opportunities in advance of that regulatory change, because the landscape is going to begin and probably competition very different on an announcement of some type of regulatory change in the US. So, we want to get out in front of that. And again, I think looking at opportunities that we think is going to fit our desired path which is again with an eye on profitability and continuing to strengthen our balance sheet. And so we feel excited about, opportunities south of the border, and we'll certainly pay attention to some of those opportunities in the coming months.
Operator
Thanks. Your next question today is coming from Doug Miehm from RBC Capital Markets. Your line is now live.
Michael Lavery -- Piper Jaffray -- Analyst
Hi, Doug.
Doug Miehm -- RBC Capital Markets -- Analyst
Hi. Thank you. How are you?
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Good, Doug.
Doug Miehm -- RBC Capital Markets -- Analyst
First question just has to do with the -- some of the ordering patterns that you may be seeing from the provinces, as we've heard from multiple parties, even yourselves that started off slow, smaller orders. Have you seen order sizes increasing in terms of size, but perhaps frequency has dropped off with the COVID situation? Could you comment on that?
Glen Ibbott -- Chief Financial Officer
Yeah, I'll take that. So, listen, we just actually asked that question on our sales team yesterday, not saying that the ordering sizes pick up -- with the exception of those places where the provinces are getting more confident. So, they're really -- as you might expect with some people that are pretty sophisticated at procurement, and now applying that to cannabis where they're seeing that they actually have great sales, they are of course ordering more of that product. They're managing to specific inventory levels that they want to have. So, I think the order patterns are reflecting that. So, the amount that they're going to order is reflective of how quickly they think it will move. They don't want to get caught in same situation like mid-2019. I would say that's too much on hand, and the LPs don't want that either, so.
Doug Miehm -- RBC Capital Markets -- Analyst
So that's why you have seen it?
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Yes, right.
Doug Miehm -- RBC Capital Markets -- Analyst
Right. But, has there been any change in the last, let's say, month or two?
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
No. Not that I've been told. Certainly, as I say, they're ordering, we've talked about this. It started to ship last year. And if anything with 2.0, they are just -- they are very sophisticated now. So, we haven't really noticed anything with the COVID that has been a significant shift from what they were -- the trends we are already seeing.
Operator
Thank you. We have reached the end of our question-and-answer session. I would like to turn the floor back over to management for any further or closing comments.
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Well, I just wanted to thank everybody for obviously taking the time to join our conference call. Once again, this company is laser-focused on controlling the things that we can, and that is, our reset plan was aimed at removing complexity out of our business and reducing costs to a level that was consistent where we believe the business to be today, with obviously a lens on an ability to scale that up, if and when we see the market changing. But we're very confident in the changes and the measures that we've taken to get us to where we are today. The job's not done. The balance of this quarter is to sort of get everything in line to ensure that we're going to deliver on our key objectives going into Q1 2021.
And so, the team has been incredibly focused and incredibly motivated to ensure that we meet this target. And I obviously want to thank the team and all of our employees for being incredibly supportive of this important focus of the organization. We're more disciplined as an organization than ever before. And all the decisions we make are certainly with the lens of near-term value and bringing true value to our investors. And so, you're going to see that as we go forward. And I'm excited about further updates that we're going to provide the market and of course our investors as we go forward.
So, thank you very much for joining.
Operator
[Operator Closing Remarks]
Duration: 60 minutes
Call participants:
Michael Singer -- Executive Chairman and Interim Chief Executive Officer
Glen Ibbott -- Chief Financial Officer
Steve Schneiderman -- Cowen and Company -- Analyst
Michael Lavery -- Piper Jaffray -- Analyst
David Kideckel -- AltaCorp Capital -- Analyst
John Zamparo -- CIBC Capital Markets -- Analyst
Pablo Zuanic -- Cantor Fitzgerald -- Analyst
Adam Buckman -- Scotiabank -- Analyst
John Chu -- Desjardins Capital Markets -- Analyst
Graeme Kreindler -- Eight Capital -- Analyst
Doug Miehm -- RBC Capital Markets -- Analyst
More ACB analysis
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Aurora Cannabis Inc (NYSE: ACB) Q3 2020 Earnings Call May 14, 2020, 5:00 p.m. Operator [Operator Closing Remarks] Duration: 60 minutes Call participants: Michael Singer -- Executive Chairman and Interim Chief Executive Officer Glen Ibbott -- Chief Financial Officer Steve Schneiderman -- Cowen and Company -- Analyst Michael Lavery -- Piper Jaffray -- Analyst David Kideckel -- AltaCorp Capital -- Analyst John Zamparo -- CIBC Capital Markets -- Analyst Pablo Zuanic -- Cantor Fitzgerald -- Analyst Adam Buckman -- Scotiabank -- Analyst John Chu -- Desjardins Capital Markets -- Analyst Graeme Kreindler -- Eight Capital -- Analyst Doug Miehm -- RBC Capital Markets -- Analyst More ACB analysis All earnings call transcripts {%sfr%} 10 stocks we like better than Aurora Cannabis Inc. We have also introduced a special bonus pay program for active facility-based staff, and we continue to maintain regular communication with government representatives, suppliers, customers and business partners to identify and monitor any potential risks to our ongoing operations. | Operator [Operator Closing Remarks] Duration: 60 minutes Call participants: Michael Singer -- Executive Chairman and Interim Chief Executive Officer Glen Ibbott -- Chief Financial Officer Steve Schneiderman -- Cowen and Company -- Analyst Michael Lavery -- Piper Jaffray -- Analyst David Kideckel -- AltaCorp Capital -- Analyst John Zamparo -- CIBC Capital Markets -- Analyst Pablo Zuanic -- Cantor Fitzgerald -- Analyst Adam Buckman -- Scotiabank -- Analyst John Chu -- Desjardins Capital Markets -- Analyst Graeme Kreindler -- Eight Capital -- Analyst Doug Miehm -- RBC Capital Markets -- Analyst More ACB analysis All earnings call transcripts {%sfr%} 10 stocks we like better than Aurora Cannabis Inc. Aurora Cannabis Inc (NYSE: ACB) Q3 2020 Earnings Call May 14, 2020, 5:00 p.m. The production and sale of cannabis has been recognized as essential services across Canada and Europe, and consumer cannabis sales are primarily with government bodies, which continue to offer end customers online ordering and home delivery, and consumer market retail stores are generally permitted to remain open, subject to a hearing to the required social distancing measures. | Operator [Operator Closing Remarks] Duration: 60 minutes Call participants: Michael Singer -- Executive Chairman and Interim Chief Executive Officer Glen Ibbott -- Chief Financial Officer Steve Schneiderman -- Cowen and Company -- Analyst Michael Lavery -- Piper Jaffray -- Analyst David Kideckel -- AltaCorp Capital -- Analyst John Zamparo -- CIBC Capital Markets -- Analyst Pablo Zuanic -- Cantor Fitzgerald -- Analyst Adam Buckman -- Scotiabank -- Analyst John Chu -- Desjardins Capital Markets -- Analyst Graeme Kreindler -- Eight Capital -- Analyst Doug Miehm -- RBC Capital Markets -- Analyst More ACB analysis All earnings call transcripts {%sfr%} 10 stocks we like better than Aurora Cannabis Inc. Aurora Cannabis Inc (NYSE: ACB) Q3 2020 Earnings Call May 14, 2020, 5:00 p.m. While we've remained optimistic about the total accessible market size of Canadian consumer cannabis over time and we're pleased with our current market share and performance in key Canadians consumer markets, the variables described above, make the short-term growth of the market and our revenue expectations difficult to predict with an adequate degree of precision. | Operator [Operator Closing Remarks] Duration: 60 minutes Call participants: Michael Singer -- Executive Chairman and Interim Chief Executive Officer Glen Ibbott -- Chief Financial Officer Steve Schneiderman -- Cowen and Company -- Analyst Michael Lavery -- Piper Jaffray -- Analyst David Kideckel -- AltaCorp Capital -- Analyst John Zamparo -- CIBC Capital Markets -- Analyst Pablo Zuanic -- Cantor Fitzgerald -- Analyst Adam Buckman -- Scotiabank -- Analyst John Chu -- Desjardins Capital Markets -- Analyst Graeme Kreindler -- Eight Capital -- Analyst Doug Miehm -- RBC Capital Markets -- Analyst More ACB analysis All earnings call transcripts {%sfr%} 10 stocks we like better than Aurora Cannabis Inc. Aurora Cannabis Inc (NYSE: ACB) Q3 2020 Earnings Call May 14, 2020, 5:00 p.m. Our international medical sales increased from CAD1.8 million in the second quarter to CAD4 million in Q3. |
37517.0 | 2020-05-15 00:00:00 UTC | TSX futures down as U.S.-China tensions flare | ACB | https://www.nasdaq.com/articles/tsx-futures-down-as-u.s.-china-tensions-flare-2020-05-15 | nan | nan | May 15 (Reuters) - Futures for Canada's main stock index ticked lower on Friday, as worries about Sino-U.S. tensions deepened after Washington moved to block supply of semiconductors to China's Huawei Technologies from global chipmakers.
The U.S. Commerce Department said it was amending an export rule to "strategically target Huawei’s HWT.UL acquisition of semiconductors that are the direct product of certain U.S. software and technology."
Tensions between the United States and China have flared in the past few weeks over Beijing's handling of the novel coronairus, with President Donald Trump saying on Thursday he has no interest in speaking to President Xi Jinping and suggesting he could even cut ties with Beijing.
June futures on the S&P/TSX index SXFc1 were down 0.43% at 7:00 a.m. ET.
The Toronto Stock Exchange's S&P/TSX composite index rose 0.04% to 14,509.66 on Thursday.
Dow Jones Industrial Average e-mini futures 1YMc1 were down 0.85% at 7:00 a.m. ET, while S&P 500 e-mini futures ESc1 were down 0.89% and Nasdaq 100 e-mini futures NQc1 were down 0.8%. .N
TOP STORIES TOP/CAN
Aurora Cannabis Inc ACB.TO posted a smaller loss compared with the prior quarter on Thursday as customers in the United States and Canada stockpiled cannabis ahead of lockdowns.
ANALYST RESEARCH HIGHLIGHTS RCH/CA
Aurora Cannabis Inc ACB.TO: Cowen and Company cuts price target to C$11 from C$12
Bank of Montreal BMO.TO: National Bank of Canada raises target price to C$78 from C$76
CCL Industries Inc CCLb.TO: CIBC raises target price to C$49 from C$44
COMMODITIES AT 7:00 a.m. ET
Gold futures GCc2: $1743; +0.12% GOL/
US crude CLc1: $27.92; +1.31% O/R
Brent crude LCOc1: $31.56; +1.38% O/R
U.S. ECONOMIC DATA DUE ON FRIDAY
0830 NY Fed Manufacturing for May: Expected -63.50; Prior -78.20
0830 Retail sales ex-autos mm for Apr: Expected -8.6%; Prior -4.5%
0830 Retail sales mm for Apr: Expected -12.0%; Prior -8.7%
0830 Retail ex gas/autos for Apr: Prior -3.1%
0830 Retail control for Apr: Expected -4.6%; Prior 1.7%
0830 (approx.) Retail sales yy for Apr: Prior -6.17%
0915 Industrial production mm for Apr: Expected -11.5%; Prior -5.4%
0915 Capacity utilization SA for Apr: Expected 64.0%; Prior 72.7%
0915 Manufacturing output mm for Apr: Expected -13.0%; Prior -6.3%
0915 (approx.) Industrial production yy for Apr: Prior -5.49%
1000 Business inventories mm for Mar: Expected -0.2%; Prior -0.4%
1000 Retail inventories ex-auto rev for Mar: Prior -1.3%
1000 JOLTS job openings for Mar: Prior 6.882 mln
1000 U Mich Sentiment Preliminary for May: Expected 68.0; Prior 71.8
1000 U Mich Conditions Preliminary for May: Expected 75.0; Prior 74.3
1000 U Mich Expectations Preliminary for May: Expected 71.8; Prior 70.1
FOR CANADIAN MARKETS NEWS, CLICK ON CODES:
TSX market report .TO
Canadian dollar and bonds report CAD/CA/
Reuters global stocks poll for Canada EQUITYPOLL1, EPOLL/CA
Canadian markets directory CANADA
($1= C$1.41)
(Reporting by Nachiket Tekawade in Bengaluru; Editing by Aditya Soni)
((Nachiket.tekawade@thomsonreuters.com))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Aurora Cannabis Inc ACB.TO posted a smaller loss compared with the prior quarter on Thursday as customers in the United States and Canada stockpiled cannabis ahead of lockdowns. Aurora Cannabis Inc ACB.TO: Cowen and Company cuts price target to C$11 from C$12 Bank of Montreal BMO.TO: National Bank of Canada raises target price to C$78 from C$76 CCL Industries Inc CCLb.TO: CIBC raises target price to C$49 from C$44 COMMODITIES AT 7:00 a.m. May 15 (Reuters) - Futures for Canada's main stock index ticked lower on Friday, as worries about Sino-U.S. tensions deepened after Washington moved to block supply of semiconductors to China's Huawei Technologies from global chipmakers. | Aurora Cannabis Inc ACB.TO posted a smaller loss compared with the prior quarter on Thursday as customers in the United States and Canada stockpiled cannabis ahead of lockdowns. Aurora Cannabis Inc ACB.TO: Cowen and Company cuts price target to C$11 from C$12 Bank of Montreal BMO.TO: National Bank of Canada raises target price to C$78 from C$76 CCL Industries Inc CCLb.TO: CIBC raises target price to C$49 from C$44 COMMODITIES AT 7:00 a.m. 0830 NY Fed Manufacturing for May: Expected -63.50; Prior -78.20 0830 Retail sales ex-autos mm for Apr: Expected -8.6%; Prior -4.5% 0830 Retail sales mm for Apr: Expected -12.0%; Prior -8.7% 0830 Retail ex gas/autos for Apr: Prior -3.1% 0830 Retail control for Apr: Expected -4.6%; Prior 1.7% 0830 (approx.) | Aurora Cannabis Inc ACB.TO posted a smaller loss compared with the prior quarter on Thursday as customers in the United States and Canada stockpiled cannabis ahead of lockdowns. Aurora Cannabis Inc ACB.TO: Cowen and Company cuts price target to C$11 from C$12 Bank of Montreal BMO.TO: National Bank of Canada raises target price to C$78 from C$76 CCL Industries Inc CCLb.TO: CIBC raises target price to C$49 from C$44 COMMODITIES AT 7:00 a.m. 0830 NY Fed Manufacturing for May: Expected -63.50; Prior -78.20 0830 Retail sales ex-autos mm for Apr: Expected -8.6%; Prior -4.5% 0830 Retail sales mm for Apr: Expected -12.0%; Prior -8.7% 0830 Retail ex gas/autos for Apr: Prior -3.1% 0830 Retail control for Apr: Expected -4.6%; Prior 1.7% 0830 (approx.) | Aurora Cannabis Inc ACB.TO posted a smaller loss compared with the prior quarter on Thursday as customers in the United States and Canada stockpiled cannabis ahead of lockdowns. Aurora Cannabis Inc ACB.TO: Cowen and Company cuts price target to C$11 from C$12 Bank of Montreal BMO.TO: National Bank of Canada raises target price to C$78 from C$76 CCL Industries Inc CCLb.TO: CIBC raises target price to C$49 from C$44 COMMODITIES AT 7:00 a.m. May 15 (Reuters) - Futures for Canada's main stock index ticked lower on Friday, as worries about Sino-U.S. tensions deepened after Washington moved to block supply of semiconductors to China's Huawei Technologies from global chipmakers. |
37518.0 | 2020-05-14 00:00:00 UTC | Why Aurora Cannabis Stock Surged Today | ACB | https://www.nasdaq.com/articles/why-aurora-cannabis-stock-surged-today-2020-05-14 | nan | nan | What happened
Shares of Aurora Cannabis (NYSE: ACB) jumped more than 14% on Thursday. As of 5:35 p.m. EDT, the stock was up an additional 17% in after-hours trading, following the release of the marijuana producer's fiscal third-quarter earnings results.
So what
Aurora's net revenue, excluding provisions, leapt 18% sequentially to 78.4 million Canadian dollars, driven by a 24% rise in recreational consumer cannabis sales and a 13.5% increase in medical cannabis revenue. The gains came despite coronavirus-related restrictions on dispensaries, which made it more difficult to process marijuana orders.
"I am incredibly proud of the Aurora team for working through these challenging times in order to maintain uninterrupted operations at all of our production facilities and ensure we continue to meet the needs of our patients and consumers," Executive Chairman and Interim CEO Michael Singer said in a press release.
Shares of Aurora Cannabis soared on Thursday. Image source: Getty Images.
Now what
Aurora also touted an improvement in "cash use" during the third quarter as it reduced its negative cash flow by 43% -- to $154.6 million -- compared to the second quarter. While this is clearly an improvement, Aurora is still burning through cash at an alarming rate. The cannabis leader will need to stop the bleeding soon if it's to continue to reward investors.
10 stocks we like better than Aurora Cannabis Inc.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | What happened Shares of Aurora Cannabis (NYSE: ACB) jumped more than 14% on Thursday. As of 5:35 p.m. EDT, the stock was up an additional 17% in after-hours trading, following the release of the marijuana producer's fiscal third-quarter earnings results. "I am incredibly proud of the Aurora team for working through these challenging times in order to maintain uninterrupted operations at all of our production facilities and ensure we continue to meet the needs of our patients and consumers," Executive Chairman and Interim CEO Michael Singer said in a press release. | What happened Shares of Aurora Cannabis (NYSE: ACB) jumped more than 14% on Thursday. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market. * David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Aurora Cannabis Inc. wasn't one of them! | What happened Shares of Aurora Cannabis (NYSE: ACB) jumped more than 14% on Thursday. 10 stocks we like better than Aurora Cannabis Inc. * David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Aurora Cannabis Inc. wasn't one of them! | What happened Shares of Aurora Cannabis (NYSE: ACB) jumped more than 14% on Thursday. 10 stocks we like better than Aurora Cannabis Inc. * David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Aurora Cannabis Inc. wasn't one of them! |
37519.0 | 2020-05-14 00:00:00 UTC | Aurora Cannabis Reports Fiscal Third-Quarter 2020 Results | ACB | https://www.nasdaq.com/articles/aurora-cannabis-reports-fiscal-third-quarter-2020-results-2020-05-14 | nan | nan | Aurora Cannabis (NYSE: ACB) unveiled its fiscal third-quarter financial results after the market closed on Thursday, reporting net revenue growth of 15.9% year over year to 75.5 million Canadian dollars and a net loss of 137.4 million Canadian dollars.
In February, the marijuana company announced a major restructuring to reduce costs and accelerate its pathway to profitability, which translated into improved financial performance in the third quarter.
IMAGE SOURCE: GETTY IMAGES.
The company benefited from increasing marijuana sales in both the medical and recreational markets during the period.
Canadian medical marijuana net revenue increased to CA$27.0 million from CA$25.6 million in the previous quarter, despite a 4% decrease in active registered patients. International medical marijuana net revenue jumped 125% sequentially to $4 million as sales resumed in Germany. On the recreational front, consumer net revenue improved 68% from fiscal Q2 to CA$38.6 million in fiscal Q3 thanks to volume growth, the launch of Aurora's value-oriented brand, and the roll-out of Cannabis 2.0 products such as vaporizers in December.
On the bottom line, selling, general, and administrative expenses totaled CA$80.1 million, down CA$19.7 million from CA$99.9 million in fiscal Q2. That decline came as a result of the company's restructuring plan, which included a headcount reduction and lower capital expenditures.
Looking forward, Aurora is entering its fiscal fourth quarter with an SG&A run rate of roughly CA$60 million, including research and development costs; management expects that SG&A run rate to fall below CA$45 million by the time it's exiting its fiscal Q4. The expected decline in expenses has management targeting positive adjusted EBITDA in fiscal Q1 2021.
10 stocks we like better than Aurora Cannabis Inc.
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Todd Campbell has no position in any of the stocks mentioned. His clients may have positions in the companies mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Aurora Cannabis (NYSE: ACB) unveiled its fiscal third-quarter financial results after the market closed on Thursday, reporting net revenue growth of 15.9% year over year to 75.5 million Canadian dollars and a net loss of 137.4 million Canadian dollars. In February, the marijuana company announced a major restructuring to reduce costs and accelerate its pathway to profitability, which translated into improved financial performance in the third quarter. Looking forward, Aurora is entering its fiscal fourth quarter with an SG&A run rate of roughly CA$60 million, including research and development costs; management expects that SG&A run rate to fall below CA$45 million by the time it's exiting its fiscal Q4. | Aurora Cannabis (NYSE: ACB) unveiled its fiscal third-quarter financial results after the market closed on Thursday, reporting net revenue growth of 15.9% year over year to 75.5 million Canadian dollars and a net loss of 137.4 million Canadian dollars. Canadian medical marijuana net revenue increased to CA$27.0 million from CA$25.6 million in the previous quarter, despite a 4% decrease in active registered patients. Looking forward, Aurora is entering its fiscal fourth quarter with an SG&A run rate of roughly CA$60 million, including research and development costs; management expects that SG&A run rate to fall below CA$45 million by the time it's exiting its fiscal Q4. | Aurora Cannabis (NYSE: ACB) unveiled its fiscal third-quarter financial results after the market closed on Thursday, reporting net revenue growth of 15.9% year over year to 75.5 million Canadian dollars and a net loss of 137.4 million Canadian dollars. Looking forward, Aurora is entering its fiscal fourth quarter with an SG&A run rate of roughly CA$60 million, including research and development costs; management expects that SG&A run rate to fall below CA$45 million by the time it's exiting its fiscal Q4. See the 10 stocks *Stock Advisor returns as of April 16, 2020 Todd Campbell has no position in any of the stocks mentioned. | Aurora Cannabis (NYSE: ACB) unveiled its fiscal third-quarter financial results after the market closed on Thursday, reporting net revenue growth of 15.9% year over year to 75.5 million Canadian dollars and a net loss of 137.4 million Canadian dollars. Canadian medical marijuana net revenue increased to CA$27.0 million from CA$25.6 million in the previous quarter, despite a 4% decrease in active registered patients. 10 stocks we like better than Aurora Cannabis Inc. |
37520.0 | 2020-05-14 00:00:00 UTC | Pot producer Aurora Cannabis posts 16% rise in revenue | ACB | https://www.nasdaq.com/articles/pot-producer-aurora-cannabis-posts-16-rise-in-revenue-2020-05-14 | nan | nan | May 14 (Reuters) - Canadian pot producer Aurora Cannabis Inc ACB.TO, ACB.N said on Thursday it sold more kilograms of cannabis for both adult-use as well as to medical marijuana markets, boosting quarterly revenue by 16% from a year earlier.
Quarterly revenue rose to C$75.5 million ($53.79 million) in the third quarter ended March 31 from C$65.1 million a year earlier.
It sold 12,729 kilograms of cannabis, 39% more than a year ago.
($1 = 1.4037 Canadian dollars)
(Reporting by Arunima Kumar in Bengaluru; Editing by Arun Koyyur)
((Arunima.Kumar@thomsonreuters.com))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | May 14 (Reuters) - Canadian pot producer Aurora Cannabis Inc ACB.TO, ACB.N said on Thursday it sold more kilograms of cannabis for both adult-use as well as to medical marijuana markets, boosting quarterly revenue by 16% from a year earlier. It sold 12,729 kilograms of cannabis, 39% more than a year ago. ($1 = 1.4037 Canadian dollars) (Reporting by Arunima Kumar in Bengaluru; Editing by Arun Koyyur) ((Arunima.Kumar@thomsonreuters.com)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | May 14 (Reuters) - Canadian pot producer Aurora Cannabis Inc ACB.TO, ACB.N said on Thursday it sold more kilograms of cannabis for both adult-use as well as to medical marijuana markets, boosting quarterly revenue by 16% from a year earlier. Quarterly revenue rose to C$75.5 million ($53.79 million) in the third quarter ended March 31 from C$65.1 million a year earlier. It sold 12,729 kilograms of cannabis, 39% more than a year ago. | May 14 (Reuters) - Canadian pot producer Aurora Cannabis Inc ACB.TO, ACB.N said on Thursday it sold more kilograms of cannabis for both adult-use as well as to medical marijuana markets, boosting quarterly revenue by 16% from a year earlier. Quarterly revenue rose to C$75.5 million ($53.79 million) in the third quarter ended March 31 from C$65.1 million a year earlier. ($1 = 1.4037 Canadian dollars) (Reporting by Arunima Kumar in Bengaluru; Editing by Arun Koyyur) ((Arunima.Kumar@thomsonreuters.com)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | May 14 (Reuters) - Canadian pot producer Aurora Cannabis Inc ACB.TO, ACB.N said on Thursday it sold more kilograms of cannabis for both adult-use as well as to medical marijuana markets, boosting quarterly revenue by 16% from a year earlier. Quarterly revenue rose to C$75.5 million ($53.79 million) in the third quarter ended March 31 from C$65.1 million a year earlier. It sold 12,729 kilograms of cannabis, 39% more than a year ago. |
37521.0 | 2020-05-14 00:00:00 UTC | Stock Market News: Why Haven't Marijuana Stocks Boomed During Lockdowns? | ACB | https://www.nasdaq.com/articles/stock-market-news%3A-why-havent-marijuana-stocks-boomed-during-lockdowns-2020-05-14 | nan | nan | Thursday morning brought more losses to Wall Street as investors continued to react negatively to a rising chorus of downbeat assessments of the global economy's near-term future. Several well-respected institutional investors have warned that the optimism from the market's rebound from the coronavirus bear market might not be warranted, especially in light of further weakness in employment. As of just after 11:30 a.m. EDT, the Dow Jones Industrial Average (DJINDICES: ^DJI) was down 89 points to 23,159. The S&P 500 (SNPINDEX: ^GSPC) fell 17 points to 2,803, and the Nasdaq Composite (NASDAQINDEX: ^IXIC) dropped 85 points to 8,778.
Cannabis investors have largely been disappointed with the performance of marijuana stocks during the past several months. Just like consumers hoarded toilet paper and other necessities, some shareholders in cannabis companies had expected to see rising demand from customers stuck at home. However, even if that's been the case, it hasn't translated to gains for major cannabis producers. The ETFMG Alternative Harvest ETF (NYSEMKT: MJ), for example, has lost more than 30% of its value in just the past three months.
Image source: Getty Images.
No success with Aurora's reverse split
One of the worst performers in the marijuana space lately has been Aurora Cannabis (NYSE: ACB), which is down by 66% since mid-February. The Canadian cannabis company that many had previously seen as one of the darlings of the industry has run into persistent operational problems, and the timing of the coronavirus pandemic introduced new challenges to its expansion plans that forced it to retrench.
Things got so bad for Aurora that its share price dropped below the $1 mark, and that forced the company to do a 1-for-12 reverse split. Such moves are designed to boost the share price, but they result in investors having fewer shares after the reverse split. That has thus far preserved Aurora's right to keep trading on the New York Stock Exchange, but the stock has continued to lose ground. The share price is down another 25% just this week following the reverse split, showing the danger of such moves in hurting confidence among investors.
More ugly earnings ahead?
Investors are also unhappy about what they've seen from earnings lately. Tilray (NASDAQ: TLRY) reported its first-quarter results earlier this week, and they included sales that more than doubled from year-ago levels and a tripling in international revenue from medical marijuana. However, losses were much larger than shareholders had expected.
Now, some of those watching the marijuana industry think that the stockpiling argument might actually backfire on pot companies. If people stocked up on pot at the beginning of lockdown measures, sales might be reduced now as buyers work their way through their saved-up stashes.
Moreover, cannabis retail locations are facing the same challenges as other stores, including the need to address coronavirus-related safety issues. Many stores have reduced hours or shut down entirely, and having to comply with heightened state and local requirements could pose further problems for pot stores to solve.
There's even a crisis of confidence in the executive suite at some companies. Canopy Growth (NYSE: CGC) COO Andre Fernandez and chief commercial officer Dave Bigioni have left the company, joining a host of others who faced layoffs, furloughs, and other measures.
Some had hoped that cannabis stocks would be a port in the storm during the coronavirus crisis. However, that hasn't proven to be the case, and it could take major positive developments for investors to have any real hope of a turnaround in the near future.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Dan Caplinger has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | No success with Aurora's reverse split One of the worst performers in the marijuana space lately has been Aurora Cannabis (NYSE: ACB), which is down by 66% since mid-February. Thursday morning brought more losses to Wall Street as investors continued to react negatively to a rising chorus of downbeat assessments of the global economy's near-term future. The Canadian cannabis company that many had previously seen as one of the darlings of the industry has run into persistent operational problems, and the timing of the coronavirus pandemic introduced new challenges to its expansion plans that forced it to retrench. | No success with Aurora's reverse split One of the worst performers in the marijuana space lately has been Aurora Cannabis (NYSE: ACB), which is down by 66% since mid-February. The Canadian cannabis company that many had previously seen as one of the darlings of the industry has run into persistent operational problems, and the timing of the coronavirus pandemic introduced new challenges to its expansion plans that forced it to retrench. Such moves are designed to boost the share price, but they result in investors having fewer shares after the reverse split. | No success with Aurora's reverse split One of the worst performers in the marijuana space lately has been Aurora Cannabis (NYSE: ACB), which is down by 66% since mid-February. Cannabis investors have largely been disappointed with the performance of marijuana stocks during the past several months. Here's The Marijuana Stock You've Been Waiting For A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom. | No success with Aurora's reverse split One of the worst performers in the marijuana space lately has been Aurora Cannabis (NYSE: ACB), which is down by 66% since mid-February. Here's The Marijuana Stock You've Been Waiting For A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom. The Motley Fool has no position in any of the stocks mentioned. |
37522.0 | 2020-05-13 00:00:00 UTC | $10,000 Invested in Aurora, Canopy, Cronos, and HEXO 3 Years Ago Would Be Worth This Much Today | ACB | https://www.nasdaq.com/articles/%2410000-invested-in-aurora-canopy-cronos-and-hexo-3-years-ago-would-be-worth-this-much | nan | nan | For years, the marijuana industry was the hottest investment on Wall Street. Investors could practically have thrown a dart at a list of North American licensed producers and doubled their money in a few months, if not generate even more robust gains.
Then April 2019 hit, and reality kicked in.
Over the past 13-plus months, cannabis stocks have been raked over the coals. Regulatory-based supply issues in Canada, high tax rates on leg | For years, the marijuana industry was the hottest investment on Wall Street. Investors could practically have thrown a dart at a list of North American licensed producers and doubled their money in a few months, if not generate even more robust gains. Regulatory-based supply issues in Canada, high tax rates on leg | For years, the marijuana industry was the hottest investment on Wall Street. Investors could practically have thrown a dart at a list of North American licensed producers and doubled their money in a few months, if not generate even more robust gains. Then April 2019 hit, and reality kicked in. | For years, the marijuana industry was the hottest investment on Wall Street. Investors could practically have thrown a dart at a list of North American licensed producers and doubled their money in a few months, if not generate even more robust gains. Regulatory-based supply issues in Canada, high tax rates on leg | For years, the marijuana industry was the hottest investment on Wall Street. Investors could practically have thrown a dart at a list of North American licensed producers and doubled their money in a few months, if not generate even more robust gains. Then April 2019 hit, and reality kicked in. |
37523.0 | 2020-05-13 00:00:00 UTC | 3 Safe Cannabis Stocks to Hold During the COVID-19 Pandemic | ACB | https://www.nasdaq.com/articles/3-safe-cannabis-stocks-to-hold-during-the-covid-19-pandemic-2020-05-13 | nan | nan | Cannabis investors often take on a great deal of risk by investing in the industry, and they've incurred some significant losses over the past year. The Horizons Marijuana Life Sciences ETF, which holds some of the top pot stocks in North America, is down 70% in the past 12 months. Those types of returns can scare away prospective investors from considering the industry.
But there are safer ways to get exposure to the potential growth in the cannabis sector where investors don't have to take on significant risks. Below are three relatively safe stocks that are performing well in 2020 and investors should consider buying today.
1. Scotts Miracle-Gro
Scotts Miracle-Gro (NYSE: SMG) is known for its lawn and garden products, but what makes the stock an exciting buy is its exposure to the cannabis industry -- without actually being a pot producer itself. Its Hawthorne Gardening business distributes hydroponic products that allow plants to grow without soil. This segment has been driving a lot of the company's growth. Scotts released its second-quarter results on May 6, and Hawthorne's sales were up 60% year over year. Its U.S. consumer business, which focuses on the company's traditional lawn and gardening products, was up a more modest 11%.
Image source: Getty Images.
As people stay indoors during COVID-19, Scotts can provide help with tools to stay occupied. And the company's seeing a growing demand for gardening. The company's CEO, Jim Hagedorn, said that "for the week ending May 3, we recorded our strongest seven-day period in company history with consumer purchases of more than $190 million at our largest four retail partners." The company's gardening business is doing better than it has in the past. In 2019, its sales were up by just 8%.
Currently, the stock trades at 26 times earnings, which is a good price given the growth that it's been generating.
2. GW Pharmaceuticals
GW Pharmaceuticals' (NASDAQ: GWPH) claim to fame is having the first and only cannabis-based drug approved by the U.S. Food and Drug Administration (FDA). Epidiolex is used to treat people with Dravet syndrome or Lennox-Gastaut syndrome, as young as two years old.
What makes the stock a safer buy than many other pot stocks is that medical marijuana is more widely accepted around the world, and that makes growth for GW a whole lot easier to achieve than if it needed to wait for the recreational markets to open up. Outside of Uruguay and Canada, as well as 11 states in the U.S., there aren't any other (legal) markets for recreational pot.
In 2019, during Epidiolex's first full year on the market, GW generated sales of $311.3 million. A year earlier, the company's top line totaled just $12.7 million. Its net loss has also come down drastically -- from $295.2 million in 2018 to a more modest net loss of just over $9 million this past year. There could still be a lot more growth to come for GW because in September, the European Commission approved Epidiolex to be used to in Europe to treat Lennox-Gastaut syndrome and Dravet syndrome.
3. Shopify
Shopify (NYSE: SHOP) is a tech stock that allows merchants to easily sell products and services online through many different channels. As more people lose their jobs, Shopify is catering to the needs of customers who are looking for ways to generate extra income. And that can translate into additional growth for Shopify this year. The company stated in its earnings release, dated May 6: "New stores created on the Shopify platform grew 62% between March 13, 2020 and April 24, 2020 compared to the prior six weeks, driven by the shift of commerce to online as well as by the extension of the free trial period on standard plans from 14 days to 90 days."
In Q2, Shopify's sales were up 47% year over year, but the company's net loss also grew by 30%. Profitability's remained elusive for Shopify as it's recorded a loss every year since its inception. However, the company's revenue growth has been more than enough to get investors excited about the stock. And the good news is that there are still many great opportunities for Shopify to keep growing.
One early-stage opportunity is cannabis. In addition to government-run cannabis stores, including the Ontario Cannabis Store and BC Cannabis Stores, industry giants Aurora Cannabis (NYSE: ACB) and Canopy Growth (NYSE: CGC) use Shopify's platform to sell pot online. In September 2019, Shopify announced that it would make its cannabis e-commerce platform available to merchants in the U.S. that sell hemp products, including hemp-derived cannabidiol (CBD). Shopify doesn't specify how many cannabis transactions it's processed on its platform, but the industry could play a much larger part in its operations in the future, especially if the U.S. federal government legalizes pot. Cannabis research company BDS Analytics projects that by 2025, the legal pot market in the U.S. will be worth $29.7 billion, up from an estimated $13.6 billion in 2019.
Which stock is the best one to buy today?
All three stocks are up this year and ahead of the S&P 500, although Shopify's got a big lead thus far:
Image Source: YCharts
For growth investors, Shopify may be the most attractive option today. But given its lack of profitability and the stock consistently trading at more than 25 times its sales and 15 times book value, it's a bit of a steep price to pay for a company that may run into some challenges if COVID-19 sinks global economies into prolonged recessions.
Both GW and Scotts give investors more exposure to cannabis and still have a lot of growth left as well. But with a solid gardening business already in place that the company can build around, Scotts is the safer investment today.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
David Jagielski owns shares of Scotts Miracle-Gro. The Motley Fool owns shares of and recommends Scotts Miracle-Gro and Shopify. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | In addition to government-run cannabis stores, including the Ontario Cannabis Store and BC Cannabis Stores, industry giants Aurora Cannabis (NYSE: ACB) and Canopy Growth (NYSE: CGC) use Shopify's platform to sell pot online. In September 2019, Shopify announced that it would make its cannabis e-commerce platform available to merchants in the U.S. that sell hemp products, including hemp-derived cannabidiol (CBD). Shopify doesn't specify how many cannabis transactions it's processed on its platform, but the industry could play a much larger part in its operations in the future, especially if the U.S. federal government legalizes pot. | In addition to government-run cannabis stores, including the Ontario Cannabis Store and BC Cannabis Stores, industry giants Aurora Cannabis (NYSE: ACB) and Canopy Growth (NYSE: CGC) use Shopify's platform to sell pot online. Scotts Miracle-Gro Scotts Miracle-Gro (NYSE: SMG) is known for its lawn and garden products, but what makes the stock an exciting buy is its exposure to the cannabis industry -- without actually being a pot producer itself. In 2019, during Epidiolex's first full year on the market, GW generated sales of $311.3 million. | In addition to government-run cannabis stores, including the Ontario Cannabis Store and BC Cannabis Stores, industry giants Aurora Cannabis (NYSE: ACB) and Canopy Growth (NYSE: CGC) use Shopify's platform to sell pot online. Scotts Miracle-Gro Scotts Miracle-Gro (NYSE: SMG) is known for its lawn and garden products, but what makes the stock an exciting buy is its exposure to the cannabis industry -- without actually being a pot producer itself. All three stocks are up this year and ahead of the S&P 500, although Shopify's got a big lead thus far: Image Source: YCharts For growth investors, Shopify may be the most attractive option today. | In addition to government-run cannabis stores, including the Ontario Cannabis Store and BC Cannabis Stores, industry giants Aurora Cannabis (NYSE: ACB) and Canopy Growth (NYSE: CGC) use Shopify's platform to sell pot online. Cannabis investors often take on a great deal of risk by investing in the industry, and they've incurred some significant losses over the past year. Scotts Miracle-Gro Scotts Miracle-Gro (NYSE: SMG) is known for its lawn and garden products, but what makes the stock an exciting buy is its exposure to the cannabis industry -- without actually being a pot producer itself. |
37524.0 | 2020-05-13 00:00:00 UTC | Why Aurora Cannabis Is Sinking Today | ACB | https://www.nasdaq.com/articles/why-aurora-cannabis-is-sinking-today-2020-05-13 | nan | nan | What happened?
Shares of Aurora Cannabis (NYSE: ACB) are down by 9.4% as of 3:12 p.m. EDT on Wednesday, despite the company not reporting any news. But with a grim economic outlook and the pot grower unlikely to wow investors with its fiscal third-quarter financial results, it isn't surprising that Aurora Cannabis's shares are falling.
So what
Speaking about the prospects of an economic recovery, Jerome Powell, head of the U.S. Federal Reserve, said the following: "It will take some time to get back to where we were." Even as states begin to ease social distancing rules, these comments from the head of the Federal Reserve are bound to scare investors, especially those who hold shares of Aurora Cannabis.
Image Source: Getty Images.
The company is set to release its financial results for the third quarter of its fiscal year 2020 on Thursday, and with Tilray (NASDAQ: TLRY) recently reporting mixed results, it's hard to imagine Aurora Cannabis doing much better, especially given recent history. To make matters worse, Aurora recently conducted a reverse stock split to boost its stock price, much to the dismay of shareholders, each of whom received one share for every 12 owned.
Now what
At writing, Aurora Cannabis's shares are down by more than 20% since this week started. However, the company could get back in the good graces of investors if it manages a slam dunk when it announces its third-quarter financial results. But if Aurora Cannabis flops again, its stock could hit a brand new bottom. Either way, it will be interesting to see what happens when the cannabis company releases its earnings report after the market closes tomorrow.
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Cannabis legalization is sweeping over North America -- 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
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Prosper Junior Bakiny owns shares of Aurora Cannabis Inc. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Shares of Aurora Cannabis (NYSE: ACB) are down by 9.4% as of 3:12 p.m. EDT on Wednesday, despite the company not reporting any news. But with a grim economic outlook and the pot grower unlikely to wow investors with its fiscal third-quarter financial results, it isn't surprising that Aurora Cannabis's shares are falling. Even as states begin to ease social distancing rules, these comments from the head of the Federal Reserve are bound to scare investors, especially those who hold shares of Aurora Cannabis. | Shares of Aurora Cannabis (NYSE: ACB) are down by 9.4% as of 3:12 p.m. EDT on Wednesday, despite the company not reporting any news. But with a grim economic outlook and the pot grower unlikely to wow investors with its fiscal third-quarter financial results, it isn't surprising that Aurora Cannabis's shares are falling. Now what At writing, Aurora Cannabis's shares are down by more than 20% since this week started. | Shares of Aurora Cannabis (NYSE: ACB) are down by 9.4% as of 3:12 p.m. EDT on Wednesday, despite the company not reporting any news. But with a grim economic outlook and the pot grower unlikely to wow investors with its fiscal third-quarter financial results, it isn't surprising that Aurora Cannabis's shares are falling. The company is set to release its financial results for the third quarter of its fiscal year 2020 on Thursday, and with Tilray (NASDAQ: TLRY) recently reporting mixed results, it's hard to imagine Aurora Cannabis doing much better, especially given recent history. | Shares of Aurora Cannabis (NYSE: ACB) are down by 9.4% as of 3:12 p.m. EDT on Wednesday, despite the company not reporting any news. What happened? The company is set to release its financial results for the third quarter of its fiscal year 2020 on Thursday, and with Tilray (NASDAQ: TLRY) recently reporting mixed results, it's hard to imagine Aurora Cannabis doing much better, especially given recent history. |
37525.0 | 2020-05-12 00:00:00 UTC | After a Reverse Split, Can Aurora Cannabis Also Reverse the Downward Trend? | ACB | https://www.nasdaq.com/articles/after-a-reverse-split-can-aurora-cannabis-also-reverse-the-downward-trend-2020-05-12 | nan | nan | Aurora Cannabis (ACB) is one of the major players in the Canadian pot industry, but along with many other Canadian cannabis stocks, the hype has failed to deliver profits and meet investors’ expectations. As a result, the share price has collapsed by over 90% since early May last year.
On Monday, Aurora enacted a reverse stock split to comply with the New York Stock Exchange’s regulations. Prior to the 1-for-12 split, the stock was trading for $0.66, and priced under a dollar for over two months, therefore no longer meeting the required listing criteria.
The split, though, does not increase the company’s value. That will happen, if it can win back investors’ confidence, starting with this week’s (May 14) FQ3 earnings report.
Looking ahead to the statement and further down the line, Needham analyst Matt McGinley argues that in order to restore investors’ faith and achieve its goal of becoming profitable by F21, Aurora needs to deliver on several fronts. Over the next two quarters, SG&A (selling, general & administrative) needs to be trimmed by over 50% to $45 million and gross margins need to be kept over 50%. Additionally, to meet positive EBITDA loan covenants, Aurora must increase revenue by 33% to $90 million.
“By 2H21,” notes McGinley, “It would need ~$120mn in revenue per quarter using the same cost assumptions to make its $20mn quarterly EBITDA covenant.”
And while the current macro environment exerts additional pressure, the company’s problems run deeper and require swift action to keep the business moving forward.
The analyst concluded, “Disruptions related to COVID-19 are just an additional external complexity for an industry already struggling to reset amid slow market development and excess cultivation capacity in Canada. Reported cash balances imply some improvement in the rate of FCF burn in 3Q, but we believe substantial improvement is required over the next two quarters for this business to sustain itself.”
McGinley reiterated a Hold rating on Aurora shares, yet hasn’t set a price target. (To watch McGinley’s track record, click here)
To find good ideas for cannabis stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Aurora Cannabis (ACB) is one of the major players in the Canadian pot industry, but along with many other Canadian cannabis stocks, the hype has failed to deliver profits and meet investors’ expectations. Prior to the 1-for-12 split, the stock was trading for $0.66, and priced under a dollar for over two months, therefore no longer meeting the required listing criteria. Looking ahead to the statement and further down the line, Needham analyst Matt McGinley argues that in order to restore investors’ faith and achieve its goal of becoming profitable by F21, Aurora needs to deliver on several fronts. | Aurora Cannabis (ACB) is one of the major players in the Canadian pot industry, but along with many other Canadian cannabis stocks, the hype has failed to deliver profits and meet investors’ expectations. Additionally, to meet positive EBITDA loan covenants, Aurora must increase revenue by 33% to $90 million. (To watch McGinley’s track record, click here) To find good ideas for cannabis stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights. | Aurora Cannabis (ACB) is one of the major players in the Canadian pot industry, but along with many other Canadian cannabis stocks, the hype has failed to deliver profits and meet investors’ expectations. “By 2H21,” notes McGinley, “It would need ~$120mn in revenue per quarter using the same cost assumptions to make its $20mn quarterly EBITDA covenant.” And while the current macro environment exerts additional pressure, the company’s problems run deeper and require swift action to keep the business moving forward. Reported cash balances imply some improvement in the rate of FCF burn in 3Q, but we believe substantial improvement is required over the next two quarters for this business to sustain itself.” McGinley reiterated a Hold rating on Aurora shares, yet hasn’t set a price target. | Aurora Cannabis (ACB) is one of the major players in the Canadian pot industry, but along with many other Canadian cannabis stocks, the hype has failed to deliver profits and meet investors’ expectations. As a result, the share price has collapsed by over 90% since early May last year. The split, though, does not increase the company’s value. |
37526.0 | 2020-05-12 00:00:00 UTC | Why Aurora Cannabis Stock Plunged Today | ACB | https://www.nasdaq.com/articles/why-aurora-cannabis-stock-plunged-today-2020-05-12 | nan | nan | What happened
Shares of Aurora Cannabis (NYSE: ACB) sank more than 12% on Tuesday, following a worrisome earnings release from a rival marijuana producer.
So what
Pot company Tilray (NASDAQ: TLRY) reported first-quarter losses that were far larger than Wall Street's forecasts. Revenue climbed 126% year over year to $52.1 million, driven by a 165% rise in adult-use cannabis sales and a 221% surge in medical cannabis sales in international markets. But its net loss ballooned to $184.1 million, or $1.73 per share, versus a loss of $29.4 million, or $0.31 per share, in the year-ago period. Analysts had expected a net loss of only $0.44 per share.
Shares of Aurora Cannabis fell sharply on Tuesday. Image source: Getty Images.
Now what
Analysts are concerned that cannabis companies could see tepid sales in the coming weeks, after consumers stocked up on marijuana during the early days of the pandemic. That could weigh on Aurora's and Tilray's results in the coming quarters.
Pot sales could also be stifled by the increased safety measures health officials are requiring from dispensaries during the COVID-19 crisis. Many cannabis stores are reducing their hours of operation, cutting staff, and offering only pickup and delivery, all of which could dent revenue and profits.
In turn, investors appear to be growing increasingly concerned about Aurora's upcoming earnings release, due out on Thursday.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | What happened Shares of Aurora Cannabis (NYSE: ACB) sank more than 12% on Tuesday, following a worrisome earnings release from a rival marijuana producer. Now what Analysts are concerned that cannabis companies could see tepid sales in the coming weeks, after consumers stocked up on marijuana during the early days of the pandemic. Many cannabis stores are reducing their hours of operation, cutting staff, and offering only pickup and delivery, all of which could dent revenue and profits. | What happened Shares of Aurora Cannabis (NYSE: ACB) sank more than 12% on Tuesday, following a worrisome earnings release from a rival marijuana producer. So what Pot company Tilray (NASDAQ: TLRY) reported first-quarter losses that were far larger than Wall Street's forecasts. Now what Analysts are concerned that cannabis companies could see tepid sales in the coming weeks, after consumers stocked up on marijuana during the early days of the pandemic. | What happened Shares of Aurora Cannabis (NYSE: ACB) sank more than 12% on Tuesday, following a worrisome earnings release from a rival marijuana producer. Revenue climbed 126% year over year to $52.1 million, driven by a 165% rise in adult-use cannabis sales and a 221% surge in medical cannabis sales in international markets. * David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Aurora Cannabis Inc. wasn't one of them! | What happened Shares of Aurora Cannabis (NYSE: ACB) sank more than 12% on Tuesday, following a worrisome earnings release from a rival marijuana producer. Now what Analysts are concerned that cannabis companies could see tepid sales in the coming weeks, after consumers stocked up on marijuana during the early days of the pandemic. 10 stocks we like better than Aurora Cannabis Inc. |
37527.0 | 2020-05-12 00:00:00 UTC | 4 Top Stock Trades for Wednesday: UBER, ACB, NVAX, DKNG | ACB | https://www.nasdaq.com/articles/4-top-stock-trades-for-wednesday%3A-uber-acb-nvax-dkng-2020-05-12 | nan | nan | InvestorPlace - Stock Market News, Stock Advice & Trading Tips
After a higher open, equities slipped lower throughout Tuesday’s trading session. Let’s look at a couple top stock trades for Wednesday.
Top Stock Trades for Tomorrow No. 1: Uber (UBER)
Click to Enlarge
Source: Chart courtesy of StockCharts.com
Uber (NYSE:UBER) stock is jumping on Tuesday, rallying on talks of a possible deal with GrubHub (NYSE:GRUB).
The move sent shares of Uber over its post-earnings high from Friday at $33.30. It also leaves investors at an interesting juncture on the charts.
For now, the stock continues to hold the declining 200-day moving average as support. On a close below this mark, there should be some support — it’s just not clear where it will come into play.
Uptrend support and the 20-day moving average sit between $29 and $29.50, while prior resistance at $28 could turn to support now that Uber is above it. If all of the above fail, the 50-day moving average should support the stock, just as it did earlier this month ahead of earnings.
7 Dividend Stocks That You Can Still Bank On
If Uber stock gains momentum and clears Tuesday’s high — currently at $34.45 — then look for a possible run up to the February gap, which starts near $39.
Top Stock Trades for Tomorrow No. 2: Aurora Cannabis (ACB)
Click to Enlarge
Source: Chart courtesy of StockCharts.com
Man, Aurora Cannabis (NYSE:ACB) just can’t catch a break. After a 12 for 1 reverse stock split, shares are already back below $7 and making new 52-week lows on the day.
I have not liked ACB for a very long time, and it’s got nothing to do with some strange vengeance. Simply put, the charts have been bearish for a long time, and they remain that way now.
If ACB stock can reverse and reclaim $8, along with downtrend resistance and some of its key moving averages, I will change my tune on the stock. Until that happens, though, sellers remain in control of Aurora. I’d avoid it for now and look elsewhere in the cannabis space.
Top Stock Trades for Tomorrow No. 3: Novavax (NVAX)
Click to Enlarge
Source: Chart courtesy of StockCharts.com
Novavax (NASDAQ:NVAX) is what investing dreams are made of. Shares opened the year near $4 and traded just a few cents short of $45 on Tuesday. That’s an 11-fold return in a few months — at a time where the S&P 500 has been extremely volatile.
In any regard, take note of the other spikes this stock has seen. While they all eventually yielded to higher prices, the stock suffered a notable decline first. In fact, in the prior spikes, the high was put in on the first major up-day.
Remember, reading the charts is about finding probabilities, not certainties. For all we know, NVAX is heading to $50-plus by the end of the week. But if I came into Tuesday long, I am booking some or all profits after a move like this. I don’t know if we’ll see $25 anytime soon, but look for this level to act as support if and when NVAX gets there.
Top Stock Trades for Tomorrow No. 4: DraftKings (DKNG)
Click to Enlarge
Source: Chart courtesy of StockCharts.com
DraftKings (NASDAQ:DKNG) shares continue to climb, making new 52-week highs on Tuesday.
The next stop may well be $30, provided DraftKings can clear Tuesday’s high at $28.15. Above that and the 138.2% extension near $33 is in play.
Should DKNG pull back, I want to see support come into play in that prior consolidation zone between $23.50 and $24.50. Below uptrend support (blue line), and the 20-day moving average is on the table.
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.
The post 4 Top Stock Trades for Wednesday: UBER, ACB, NVAX, DKNG appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Click to Enlarge Source: Chart courtesy of StockCharts.com Man, Aurora Cannabis (NYSE:ACB) just can’t catch a break. The post 4 Top Stock Trades for Wednesday: UBER, ACB, NVAX, DKNG appeared first on InvestorPlace. 2: Aurora Cannabis (ACB) | Click to Enlarge Source: Chart courtesy of StockCharts.com Man, Aurora Cannabis (NYSE:ACB) just can’t catch a break. 2: Aurora Cannabis (ACB) I have not liked ACB for a very long time, and it’s got nothing to do with some strange vengeance. | The post 4 Top Stock Trades for Wednesday: UBER, ACB, NVAX, DKNG appeared first on InvestorPlace. 2: Aurora Cannabis (ACB) Click to Enlarge Source: Chart courtesy of StockCharts.com Man, Aurora Cannabis (NYSE:ACB) just can’t catch a break. | The post 4 Top Stock Trades for Wednesday: UBER, ACB, NVAX, DKNG appeared first on InvestorPlace. 2: Aurora Cannabis (ACB) Click to Enlarge Source: Chart courtesy of StockCharts.com Man, Aurora Cannabis (NYSE:ACB) just can’t catch a break. |
37528.0 | 2020-05-12 00:00:00 UTC | TSX gains on oil price surge as Saudi pledges production cuts | ACB | https://www.nasdaq.com/articles/tsx-gains-on-oil-price-surge-as-saudi-pledges-production-cuts-2020-05-12 | nan | nan | May 12 (Reuters) - Canada's main stock index rose on Tuesday, steered by energy stocks as oil prices gained on Saudi Arabia's unexpected commitment to extend production cuts in June to help drain a supply glut built up due the coronavirus crisis.
* At 9:47 a.m. ET (13:47 GMT), the Toronto Stock Exchange's S&P/TSX composite index .GSPTSE was up 39.88 points, or 0.26%, at 15,143.1.
* The energy sector .SPTTEN climbed 1.8% as U.S. crude CLc1 prices rose 5.7% a barrel, while Brent crude LCOc1 gained 2.3%. O/R
* The financials sector .SPTTFS gained 0.1%, while the industrials sector .GSPTTIN fell 0.3%.
* The materials sector .GSPTTMT, which includes precious and base metals miners and fertilizer companies, added 0.7% as gold futures GCc1 rose 0.3% to $1,700 an ounce. GOL/
* On the TSX, 116 issues rose and 103 fell for a 1.13-to-1 ratio favouring gainers, with 22.60 million shares traded.
* The largest percentage gainers on the TSX were technology and network management company Real Matters Inc , which jumped 4.8%, and Canadian Natural Resources Ltd , which rose 3.4%.
* Aurora Cannabis Inc fell 4.8%, the most on the TSX, after two brokerages lowered their price target on the stock.
* The second-biggest decliner was fleet management company Element Fleet Management Corp , down 4.3%, after multiple brokerages cut price target on the stock.
* The most heavily traded shares by volume were Freegold Ventures Ltd , down 5.9%; B2gold Corp , up 1.0% and Bombardier Inc , up 1.2%.
* The TSX posted four new 52-week highs and no new lows.
* Across all Canadian issues there were 16 new 52-week highs and two new lows, with total volume of 45.26 million shares.
(Reporting by Amal S in Bengaluru; Editing by Vinay Dwivedi)
((Amal.S@thomsonreuters.com; within U.S.+1 646 223 8780; outside U.S. +91 80 6749 3677;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | May 12 (Reuters) - Canada's main stock index rose on Tuesday, steered by energy stocks as oil prices gained on Saudi Arabia's unexpected commitment to extend production cuts in June to help drain a supply glut built up due the coronavirus crisis. * The materials sector .GSPTTMT, which includes precious and base metals miners and fertilizer companies, added 0.7% as gold futures GCc1 rose 0.3% to $1,700 an ounce. * The largest percentage gainers on the TSX were technology and network management company Real Matters Inc , which jumped 4.8%, and Canadian Natural Resources Ltd , which rose 3.4%. | * The energy sector .SPTTEN climbed 1.8% as U.S. crude CLc1 prices rose 5.7% a barrel, while Brent crude LCOc1 gained 2.3%. GOL/ * On the TSX, 116 issues rose and 103 fell for a 1.13-to-1 ratio favouring gainers, with 22.60 million shares traded. * The second-biggest decliner was fleet management company Element Fleet Management Corp , down 4.3%, after multiple brokerages cut price target on the stock. | May 12 (Reuters) - Canada's main stock index rose on Tuesday, steered by energy stocks as oil prices gained on Saudi Arabia's unexpected commitment to extend production cuts in June to help drain a supply glut built up due the coronavirus crisis. GOL/ * On the TSX, 116 issues rose and 103 fell for a 1.13-to-1 ratio favouring gainers, with 22.60 million shares traded. * The second-biggest decliner was fleet management company Element Fleet Management Corp , down 4.3%, after multiple brokerages cut price target on the stock. | * The energy sector .SPTTEN climbed 1.8% as U.S. crude CLc1 prices rose 5.7% a barrel, while Brent crude LCOc1 gained 2.3%. GOL/ * On the TSX, 116 issues rose and 103 fell for a 1.13-to-1 ratio favouring gainers, with 22.60 million shares traded. * Across all Canadian issues there were 16 new 52-week highs and two new lows, with total volume of 45.26 million shares. |
37529.0 | 2020-05-11 00:00:00 UTC | Stock Market Wrap-Up: This Pot Stock's 1,000% Share-Price Rise Isn't Good News | ACB | https://www.nasdaq.com/articles/stock-market-wrap-up%3A-this-pot-stocks-1000-share-price-rise-isnt-good-news-2020-05-11 | nan | nan | The stock market put in a mixed showing on Monday, with most benchmarks bouncing back from early losses to end the day in the black. Market participants are still uncertain about what the next several months will look like for the global economy, especially as some state and local governments roll the dice and try to return to normal. The Dow Jones Industrial Average (DJINDICES: ^DJI) wasn't able to get out of the red by the end of the day, but the S&P 500 (SNPINDEX: ^GSPC) and Nasdaq Composite (NASDAQINDEX: ^IXIC) posted modest gains.
Today's stock market
INDEX
PERCENTAGE CHANGE (DECLINE)
POINT CHANGE
Dow
(0.45%)
(109)
S&P 500
0.01%
0.39
Nasdaq Composite
0.78%
71
Data source: Yahoo! Finance.
Some investors who are interested in cannabis must have wondered if they were under the influence Monday morning when they saw the share price of Aurora Cannabis (NYSE: ACB) rise by 1,000%. But unfortunately, there's an explanation why that move isn't such a big deal. News from beleaguered movie theater operator AMC Entertainment Holdings (NYSE: AMC) was the real deal, however, with the potential for an opportunistic strategic move establishing the long-term value of the company.
A higher stock price, but fewer shares
Aurora Cannabis saw its stock price close at $7.42 per share on Monday. That was up from the reported close of $0.67 per share last Friday, but most news outlets reported the day's move as a decline of 8%.
Image source: Getty Images.
The explanation is simple: Aurora approved a reverse stock split earlier this year, to reduce its number of shares outstanding in order to boost the share price. With the pot stock having traded below the $1 level for a couple of months, Aurora faced the unpleasant prospect of having its shares delisted from the New York Stock Exchange if it didn't take drastic action.
The cannabis company decided to go with a 1-for-12 reverse split. That means that somebody who owned 3,000 shares of Aurora stock last Friday worth about $2,000 found themselves with just 250 shares of stock today. That's why even at $7.42 per share, Aurora's price was effectively down, since those 250 shares were worth just over $1,850.
Aurora might not be the only pot stock that resorts to a reverse split in the near future. For now, though, investors simply need to understand that today wasn't a time to celebrate, and that further share-price declines could lie ahead.
Will Amazon buy AMC?
Elsewhere, shares of AMC Entertainment Holdings soared 30%. Even though the theater chain has struggled badly during the coronavirus pandemic, reports that e-commerce giant Amazon.com (NASDAQ: AMZN) might be looking at an acquisition of AMC helped give shareholders some hope for the fate of their investments.
Reports of talks between AMC and Amazon sparked speculation about what a combination would mean. Just as Amazon moved beyond its online marketplace to incorporate brick-and-mortar stores when it bought out Whole Foods Market, buying AMC would give Amazon a captive real-world presence for its budding entertainment content business. That could prove useful, especially if a combined theater and home-viewing approach can woo customers away from other streaming services to Amazon Prime Video.
Yet with AMC in such dire financial straits, it's uncertain that Amazon would be interested in offering particularly good terms to shareholders. Moreover, there'd be considerable regulatory scrutiny of a deal, especially given the challenges of AMC dealing with a parent company that produces content while still providing a forum for rival studios to show their movies as well.
AMC investors are hopeful that even if Amazon doesn't consummate a buyout, the report could lead to another suitor making a move. At this point, AMC's running out of time, so any news is good news.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Dan Caplinger has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Amazon and recommends the following options: short January 2022 $1940 calls on Amazon and long January 2022 $1920 calls on Amazon. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Some investors who are interested in cannabis must have wondered if they were under the influence Monday morning when they saw the share price of Aurora Cannabis (NYSE: ACB) rise by 1,000%. The stock market put in a mixed showing on Monday, with most benchmarks bouncing back from early losses to end the day in the black. The Dow Jones Industrial Average (DJINDICES: ^DJI) wasn't able to get out of the red by the end of the day, but the S&P 500 (SNPINDEX: ^GSPC) and Nasdaq Composite (NASDAQINDEX: ^IXIC) posted modest gains. | Some investors who are interested in cannabis must have wondered if they were under the influence Monday morning when they saw the share price of Aurora Cannabis (NYSE: ACB) rise by 1,000%. News from beleaguered movie theater operator AMC Entertainment Holdings (NYSE: AMC) was the real deal, however, with the potential for an opportunistic strategic move establishing the long-term value of the company. A higher stock price, but fewer shares Aurora Cannabis saw its stock price close at $7.42 per share on Monday. | Some investors who are interested in cannabis must have wondered if they were under the influence Monday morning when they saw the share price of Aurora Cannabis (NYSE: ACB) rise by 1,000%. A higher stock price, but fewer shares Aurora Cannabis saw its stock price close at $7.42 per share on Monday. That means that somebody who owned 3,000 shares of Aurora stock last Friday worth about $2,000 found themselves with just 250 shares of stock today. | Some investors who are interested in cannabis must have wondered if they were under the influence Monday morning when they saw the share price of Aurora Cannabis (NYSE: ACB) rise by 1,000%. Today's stock market A higher stock price, but fewer shares Aurora Cannabis saw its stock price close at $7.42 per share on Monday. |
37530.0 | 2020-05-11 00:00:00 UTC | Why Aurora Cannabis Stock Sank Today | ACB | https://www.nasdaq.com/articles/why-aurora-cannabis-stock-sank-today-2020-05-11 | nan | nan | What happened
Shares of Aurora Cannabis (NYSE: ACB) fell 7% on Monday after the marijuana company conducted a reverse stock split.
So what
After brutal losses in recent months, Aurora's stock price fell below $1 per share. In order for its shares to continue trading on the New York Stock exchange, Aurora needed to take action to boost its stock price. That action came in the form of a reverse stock split, which resulted in shareholders receiving 1 share for every 12 they owned.
The popular pot stock has fallen on hard times. Mounting operating losses and dwindling cash reserves have investors concerned that Aurora could run out of cash before it reaches sustained profitability.
It hasn't been easy being an Aurora Cannabis investor. Image source: Getty Images.
Now what
Aurora is expected to raise additional capital to bolster its cash reserves. However, by selling more shares to the public, Aurora would dilute existing shareholders' ownership.
After seeing the value of their shares plummet and the number of their shares reduced by more than 90% due to the reverse split, it appears that some investors have simply had enough.
Still, Aurora Cannabis will have an opportunity to give its remaining shareholders a reason to hang on when it reports its third-quarter earnings results after the market closes on May 14.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | What happened Shares of Aurora Cannabis (NYSE: ACB) fell 7% on Monday after the marijuana company conducted a reverse stock split. That action came in the form of a reverse stock split, which resulted in shareholders receiving 1 share for every 12 they owned. Still, Aurora Cannabis will have an opportunity to give its remaining shareholders a reason to hang on when it reports its third-quarter earnings results after the market closes on May 14. | What happened Shares of Aurora Cannabis (NYSE: ACB) fell 7% on Monday after the marijuana company conducted a reverse stock split. So what After brutal losses in recent months, Aurora's stock price fell below $1 per share. That action came in the form of a reverse stock split, which resulted in shareholders receiving 1 share for every 12 they owned. | What happened Shares of Aurora Cannabis (NYSE: ACB) fell 7% on Monday after the marijuana company conducted a reverse stock split. In order for its shares to continue trading on the New York Stock exchange, Aurora needed to take action to boost its stock price. See the 10 stocks *Stock Advisor returns as of April 16, 2020 Joe Tenebruso has no position in any of the stocks mentioned. | What happened Shares of Aurora Cannabis (NYSE: ACB) fell 7% on Monday after the marijuana company conducted a reverse stock split. That action came in the form of a reverse stock split, which resulted in shareholders receiving 1 share for every 12 they owned. 10 stocks we like better than Aurora Cannabis Inc. |
37531.0 | 2020-05-11 00:00:00 UTC | Aurora Cannabis' Q3 Report: 7 Numbers You'll Want to Know | ACB | https://www.nasdaq.com/articles/aurora-cannabis-q3-report%3A-7-numbers-youll-want-to-know-2020-05-11 | nan | nan | The big day is nearly here for marijuana stock investors. Following the closing bell on Thursday, May 14, the most popular marijuana stock, Aurora Cannabis (NYSE: ACB), will release its fiscal third-quarter operating results (ended March 31, 2020).
Expectations from Wall Street currently call for $66.2 million Canadian in revenue -- this is consistent with Aurora's management team calling for a modest increase in sequential quarterly sales – and a CA$0.06 per share loss, which would be an improvement over the CA$0.16 loss reported in the year-ago period. For what it's worth, Wall Street really hasn't come close to pegging Aurora's bottom-line results, with the Street missing wildly to the upside and downside over the past four quarters.
Image source: Getty Images.
What we do know is that when Aurora delivers its Q3 2020 results, it'll have more than 1.3 billion shares outstanding, it should have completed its 1-for-12 reverse split to remain compliant with New York Stock Exchange listing standards, and it'll have approximately CA$205 million in cash and cash equivalents, at least according to an April 13 press release.
However, there are a number of figures in Aurora's third-quarter operating results that I urge investors to focus on. Sure, revenue and bottom-line profit/loss are important, but there are other figures that are going to tell the tale of Aurora's financial health. Here are the seven numbers you'll want to know after the closing bell this coming Thursday.
1. What was Q3 2020 EBITDA?
Maybe the most important number to come out of the third-quarter report will be Aurora's earnings before interest, taxes, depreciation, and amortization (EBITDA). The reason? Aurora reworked its debt covenants back in early February, including the removal of EBITDA ratio covenants that were previous in place. Under the new covenant, the company is required to achieve positive EBITDA beginning in the first quarter of fiscal 2021 (ended Sept. 30, 2020). That's not a lot of time from now, so Wall Street will be looking for meaningful improvement on the EBITDA front.
Image source: Getty Images.
2. How much does Aurora now have in inventory?
Secondly, pay very close attention to Aurora Cannabis' inventory. As of its fiscal second-quarter report, the company had CA$205.5 million in inventory (in dollar terms), up from CA$113.6 million at the end of June 2019. While having some backlog of product is prudent, we've seen an escalation of inventory across the board for Canadian licensed producers. Without an adequate retail network, a glut of inventory could force Aurora to write down or destroy some of its product.
3. What percentage of sales were derived from bulk/wholesale purchases?
Somewhat building on the previous point, take note of how much revenue Aurora Cannabis generates from wholesale or bulk cannabis in the fiscal third quarter. Aurora's management team appeared to make it clear that it wanted to seek out higher-margin opportunities in the retail marijuana space rather than sell lower-margin pot on a wholesale or bulk basis. But if inventory levels continue to build at an extraordinary rate, the company may have no choice but to accept menial margins just to get product out of inventory.
4. How much did international sales total in the most recent quarter?
A fourth figure you'll want to hone in on is international revenue. To date, overseas sales have been unbelievably disappointing, especially considering that Aurora went through the trouble of establishing a production, export, research, or partnership presence in 24 markets outside of Canada. The international market is critical to Aurora's long-term success, particularly with regard to exports. Ideally, this figure comes in well above CA$5 million, up from CA$1.8 million in Q2 2020, but I'm not holding my breath.
Image source: Getty Images.
5. What percentage of sales did derivative pot products account for?
Aside from EBITDA, perhaps the next most-intriguing data point will be in discerning just how much revenue was generated from higher-margin derivatives. Derivatives being alternative consumption options such as edibles, concentrates, and vapes. These products officially began hitting dispensary shelves in Canada in mid-December, and this marks the first full quarter where we'll get an idea of how that derivative launch is going for licensed producers. There have obviously been some supply bottlenecks and shortages in key provinces, but investors will still be looking for pockets of strength and improved margins from this launch.
6. How significant were the SG&A reductions?
Sixth, make note of how effective Aurora Cannabis was at reducing its sales, general, and administrative (SG&A) costs. Back in February, at the same time the company outlined its new debt covenants, management announced its intention to reduce SG&A expenses to between CA$40 million and CA$45 million on a quarterly basis. For context, SG&A in the fiscal second quarter (ended Dec. 31, 2019) totaled CA$99.9 million.
For what it's worth, Aurora Cannabis has shed 500 jobs, halted construction on two its largest project, and is attempting to sell the Exeter greenhouse, which was acquired in the July 2018 MedReleaf purchase. But how much these actions reduced ongoing expenses remains to be seen.
7. Is there any change in goodwill from the previous quarter?
Last, but not last, investors should be particularly interested to see if the company has made any adjustments to the CA$2.41 billion in goodwill that it ended with in Q2 2020. Even after writing down CA$762.2 million last quarter, goodwill still accounts for 52% of total assets. I've made the case why a writedown of at least $1 billion (that's U.S.) tied the MedReleaf acquisition likely awaits, but it'll be interesting to see how (or if) management addresses a still-hideous balance sheet.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
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Sean Williams has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Following the closing bell on Thursday, May 14, the most popular marijuana stock, Aurora Cannabis (NYSE: ACB), will release its fiscal third-quarter operating results (ended March 31, 2020). Aurora's management team appeared to make it clear that it wanted to seek out higher-margin opportunities in the retail marijuana space rather than sell lower-margin pot on a wholesale or bulk basis. For what it's worth, Aurora Cannabis has shed 500 jobs, halted construction on two its largest project, and is attempting to sell the Exeter greenhouse, which was acquired in the July 2018 MedReleaf purchase. | Following the closing bell on Thursday, May 14, the most popular marijuana stock, Aurora Cannabis (NYSE: ACB), will release its fiscal third-quarter operating results (ended March 31, 2020). Somewhat building on the previous point, take note of how much revenue Aurora Cannabis generates from wholesale or bulk cannabis in the fiscal third quarter. Back in February, at the same time the company outlined its new debt covenants, management announced its intention to reduce SG&A expenses to between CA$40 million and CA$45 million on a quarterly basis. | Following the closing bell on Thursday, May 14, the most popular marijuana stock, Aurora Cannabis (NYSE: ACB), will release its fiscal third-quarter operating results (ended March 31, 2020). Expectations from Wall Street currently call for $66.2 million Canadian in revenue -- this is consistent with Aurora's management team calling for a modest increase in sequential quarterly sales – and a CA$0.06 per share loss, which would be an improvement over the CA$0.16 loss reported in the year-ago period. As of its fiscal second-quarter report, the company had CA$205.5 million in inventory (in dollar terms), up from CA$113.6 million at the end of June 2019. | Following the closing bell on Thursday, May 14, the most popular marijuana stock, Aurora Cannabis (NYSE: ACB), will release its fiscal third-quarter operating results (ended March 31, 2020). Under the new covenant, the company is required to achieve positive EBITDA beginning in the first quarter of fiscal 2021 (ended Sept. 30, 2020). What percentage of sales were derived from bulk/wholesale purchases? |
37532.0 | 2020-05-10 00:00:00 UTC | Watch These 6 Numbers When Aurora Cannabis Releases Earnings In May | ACB | https://www.nasdaq.com/articles/watch-these-6-numbers-when-aurora-cannabis-releases-earnings-in-may-2020-05-10 | nan | nan | The one way that struggling cannabis producer Aurora Cannabis (NYSE: ACB) can turn its fortunes around in a hurry is with a strong earnings report. But that may be easier said than done as there are many checkboxes that investors will want to tick off and review when Aurora releases its third-quarter results on May 14.
Here are six items that investors will want to keep an eye out for and assess before making an investment decision on the troubled pot stock:
1. Its cash balance
When Aurora released its second-quarter results on Feb. 13, it reported cash and cash equivalents totaling 156.3 million Canadian dollars as of Dec. 31, 2019. That was down from CA$172.7 million on June 30, 2019.
Cash is an important consideration for investors, especially with investment bank Ello Capital projecting that many cannabis companies only had a few months before they would run out of it. Aurora was supposedly among the worst cannabis companies, with just a few more months of liquidity left. Where its balance has gone during the past three months will definitely be a key consideration for investors, especially when evaluating the company from a risk standpoint. Without sufficient cash on hand to fund its operations, the company may issue more shares and experience more dilution as a result.
Image source: Getty Images.
2. How much cash it's burning through
In conjunction with its cash balance, investors will also want to see that the company isn't burning through lots of cash, either. Aurora could generate cash from selling off assets and helping keep the lights on that way, but that's not a sustainable approach to funding its operations That's why investors should take a close look at how much cash the company's burning through, especially from its operations. Cutting back on growth initiatives and capital spending is a lot easier than cutting back on day-to-day expenses that the company needs to keep operating and producing products.
Cash flow from operating activities is a key number that all cannabis investors should keep an eye out for when reviewing any earnings report since it includes spending that's essential to keep the business going. In Aurora's case, it's even more important given the concerns surrounding the company's liquidity.
3. Whether the COVID-19 pandemic helped or hurt its sales
What was surprising about Q2 for Aurora wasn't just that sales were down by 26% from the first quarter, but that the company was forecasting "modest to no growth" for Q3 as well. The strength of its sales will likely dictate whether or not the stock has a good day or not on earnings day. Growth has been a key reason for the popularity of pot stocks in recent years. The good news for Aurora investors is that the COVID-19 pandemic may have given the stock's sales a boost during the quarter.
In Canada, sales were surging in March amid the pandemic, with customers stockpiling pot. Some Ontario shops saw sales rise by 80% from previous weeks, and the Ontario Cannabis Store saw volumes rise by even more. If Aurora can't achieve better growth than it expected for this quarter, that could be a troubling sign for investors; the pandemic will likely make things worse as more people lose their jobs and may not be able to afford to buy cannabis. A poor showing in Q3 could set the stage for more disappointment later on this year.
4. If value brands are cutting into the company's gross margins
In February, investors learned that Aurora and other cannabis producers -- HEXO and Tilray -- would be launching value brands to compete with the black market. Called "Daily Special," Aurora's brand could help draw in more market share and give its sales a boost this quarter. However, it could come at the cost of lower gross margins. In Q2, Aurora netted 41% of revenue after cost of goods sold and before fair value adjustments to inventory. In the prior year, its gross margin was 52% of net sales.
A lower margin could negate any boost in sales. And at worst, if sales are down, it could lead to less gross profit available to cover the company's operating losses, potentially making the company's net loss bigger this quarter.
5. What improvements (if any) there are in operating expenses
Aurora announced in February that it was eliminating 500 positions to improve its financial performance. In Q2, the company's operating expenses of CA$149.5 million were 14% higher than in Q1 when Aurora incurred operating expenses of $131.1 million. With general and administrative expenses of $70.8 million making up close to half (47%) of Aurora's total operating costs last quarter, investors should expect to see some noticeable cost savings this quarter. If not, it could suggest that management needs to make more cuts and that Aurora has not been aggressive enough in improving its bottom line.
6. How much distortion there is in income and expenses
In Q2, Aurora had CA$1.2 billion worth of other expenses, the bulk of which were related to impairments. Investors should be careful to look at this line item for a couple of reasons. The first is that it can explain an abnormal profit or loss in Q3, as there can be a lot of noise in this section that ends up impacting the bottom line. The second reason is that if impairment charges continue to show up in Q3, this pattern could undermine the reliability of the company's asset values and financials as a whole, which can make it difficult to trust the company's reporting if writedowns become the norm.
Investors should look at these numbers before considering the bottom line
The reason net income isn't on this list is that it can often be misleading for pot stocks, especially if there's a large one-time gain or loss. It can tell a much different story for investors than by focusing on the items listed above. By looking at the key areas noted above, investors will have more context to put the overall results into and can make a better assessment of just how well the company did.
Shares of Aurora have crashed 92% in the past 12 months, which is much worse than the Horizons Marijuana Life Sciences ETF, which is down 70% during the same period. Without a strong showing on all of the items above, it'll be difficult for Aurora to turn things around anytime soon. And until that happens, it'll remain a very high-risk investment.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
David Jagielski has no position in any of the stocks mentioned. The Motley Fool recommends HEXO. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The one way that struggling cannabis producer Aurora Cannabis (NYSE: ACB) can turn its fortunes around in a hurry is with a strong earnings report. Cash flow from operating activities is a key number that all cannabis investors should keep an eye out for when reviewing any earnings report since it includes spending that's essential to keep the business going. If Aurora can't achieve better growth than it expected for this quarter, that could be a troubling sign for investors; the pandemic will likely make things worse as more people lose their jobs and may not be able to afford to buy cannabis. | The one way that struggling cannabis producer Aurora Cannabis (NYSE: ACB) can turn its fortunes around in a hurry is with a strong earnings report. Its cash balance When Aurora released its second-quarter results on Feb. 13, it reported cash and cash equivalents totaling 156.3 million Canadian dollars as of Dec. 31, 2019. If value brands are cutting into the company's gross margins In February, investors learned that Aurora and other cannabis producers -- HEXO and Tilray -- would be launching value brands to compete with the black market. | The one way that struggling cannabis producer Aurora Cannabis (NYSE: ACB) can turn its fortunes around in a hurry is with a strong earnings report. Aurora could generate cash from selling off assets and helping keep the lights on that way, but that's not a sustainable approach to funding its operations That's why investors should take a close look at how much cash the company's burning through, especially from its operations. If value brands are cutting into the company's gross margins In February, investors learned that Aurora and other cannabis producers -- HEXO and Tilray -- would be launching value brands to compete with the black market. | The one way that struggling cannabis producer Aurora Cannabis (NYSE: ACB) can turn its fortunes around in a hurry is with a strong earnings report. Here are six items that investors will want to keep an eye out for and assess before making an investment decision on the troubled pot stock: 1. The good news for Aurora investors is that the COVID-19 pandemic may have given the stock's sales a boost during the quarter. |
37533.0 | 2020-05-08 00:00:00 UTC | Is Aurora Cannabis (ACB) Stock a Buy Right Now? This Is What You Need To Know | ACB | https://www.nasdaq.com/articles/is-aurora-cannabis-acb-stock-a-buy-right-now-this-is-what-you-need-to-know-2020-05-08 | nan | nan | While all eyes are on the reverse split, Aurora Cannabis (ACB) investors should be more focused on FQ3 cost controls. The Canadian cannabis company has long had the ability to generate revenues, but the business has never matched those with viable operating expenses.
The company plans a reverse split before the market opens on May 11 to satisfy NYSE listing requirements. Most reverse splits are negative for shareholders, but Aurora Cannabis has the ability to showcase improving trends far outweigh a reverse share split.
According to TipRanks, the consensus on Wall Street is that Aurora Cannabis stock is a “sell” for investors. But TipRanks might as well have said “buy” — because analysts, on average, think the stock, currently at $0.67, could zoom ahead to $1.30 within a year, delivering 95% profits to new investors.
Cost Controls
While the company will only have a post-split share count of ~110 million shares, the stock value isn’t enhanced by the split. The only way to reward shareholders is for Aurora Cannabis to report solid revenues while pulling down quarterly operating expenses.
Back in early February, Aurora Cannabis announced plans to lower SG&A expenses to a quarterly range of C$40 million to C$45 million. The goal is to set the company up for these quarterly expenses by the start of FY21 in July.
Analysts forecast sales rising from flat sequentially to around C$66 million in the March quarter based on commentary from the company. The analyst goal is another bump to C$75 million in the June quarter.
Hitting these sales amounts are crucial to confirm Aurora Cannabis can cut SG&A expenses that swelled to C$99 million in FQ2. The company is targeting a massive C$50 million cut while still growing revenues.
Reducing Cash Burn
Some analysts estimate that Aurora Cannabis burned up to C$200 million in the March quarter. The cannabis company has to slash this amount to negligible levels via cutting expenses and all but eliminating capital expenditures to survive and thrive.
The company only had C$205 million in cash to end the last quarter so controlling spending is paramount to not further dilute shareholders, especially when the market is so focused on the reverse split. Aurora Cannabis filed another C$350 million at-the-market offering that could dilute shareholders by over 30% with the current market cap below $1 billion.
Aurora Cannabis doesn’t plan to use the full ATM offering. The company had plans to reduce quarterly capital spending below C$50 million per quarter and these amounts need to be slashed to negligible levels where possible.
Takeaway
The key investor takeaway is that the valuation equation for Aurora Cannabis isn’t impacted by a reverse stock split, though traders will likely to attempt to short the stock lower. The shareholder impact comes from a lowered stock price causing more dilution to shareholders when the company sells stock to fund ongoing cash burn.
As the company should already have visibility into mid-June quarter numbers, the ability to pronounce a solid path to breakeven on an operating basis is key. On top of that, the elimination of nearly all capital expenditures would alleviate crucial cash burn levels. Aurora Cannabis has the plans for finally being on the right track supporting a stock rally from here, but any indication the company doesn’t have the cash burn under control when reporting quarterly results on May 14 will send the stock lower.
To find good ideas for stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | While all eyes are on the reverse split, Aurora Cannabis (ACB) investors should be more focused on FQ3 cost controls. The cannabis company has to slash this amount to negligible levels via cutting expenses and all but eliminating capital expenditures to survive and thrive. The company only had C$205 million in cash to end the last quarter so controlling spending is paramount to not further dilute shareholders, especially when the market is so focused on the reverse split. | While all eyes are on the reverse split, Aurora Cannabis (ACB) investors should be more focused on FQ3 cost controls. The cannabis company has to slash this amount to negligible levels via cutting expenses and all but eliminating capital expenditures to survive and thrive. The company had plans to reduce quarterly capital spending below C$50 million per quarter and these amounts need to be slashed to negligible levels where possible. | While all eyes are on the reverse split, Aurora Cannabis (ACB) investors should be more focused on FQ3 cost controls. Back in early February, Aurora Cannabis announced plans to lower SG&A expenses to a quarterly range of C$40 million to C$45 million. Takeaway The key investor takeaway is that the valuation equation for Aurora Cannabis isn’t impacted by a reverse stock split, though traders will likely to attempt to short the stock lower. | While all eyes are on the reverse split, Aurora Cannabis (ACB) investors should be more focused on FQ3 cost controls. Hitting these sales amounts are crucial to confirm Aurora Cannabis can cut SG&A expenses that swelled to C$99 million in FQ2. The company only had C$205 million in cash to end the last quarter so controlling spending is paramount to not further dilute shareholders, especially when the market is so focused on the reverse split. |
37534.0 | 2020-05-08 00:00:00 UTC | Canopy Growth Is the Definition of a Long-Term Investment | ACB | https://www.nasdaq.com/articles/canopy-growth-is-the-definition-of-a-long-term-investment-2020-05-08 | nan | nan | InvestorPlace - Stock Market News, Stock Advice & Trading Tips
When I last wrote about Canopy Growth (NYSE:CGC) in March, CGC stock was testing three-year lows. The reason for that was the novel coronavirus was forcing the company to close its corporate-owned Tokyo Smoke and Tweed stores.
Source: Shutterstock
But those stores are now open again, at least for pick-up and delivery. And that means that Canopy will at least be able to post some sales as Canada begins the slow process of reopening.
Investing in cannabis stocks is like running a marathon. I believe there will be a payoff at the end, but it’s going to take a while to get there. And along the way, only the most determined are going to survive.
7 A-Rated REITs to Buy Now
That brings me to another point I had made about Canopy in my last article. The company was rapidly burning through the cash it received from Constellation Brands (NYSE:STZ) in 2018. But that situation changed when Constellation increased its investment.
Understanding Constellation’s Vote of Confidence
Constellation CEO Bill Newlands cited three reasons for the company’s continuing investment in Canopy. The logic goes like this. The global cannabis market is expected to exceed $250 billion in the next 15 years. That means that cannabis could easily outpace the market that Constellation plays in today.
With that said, Constellation obviously believes that Canopy is going to be a major player in that market. In a statement, Newlands wrote that “Canopy is best positioned to win in the emerging cannabis space.” And one reason for that, of course, is the cannabis-infused beverages that Constellation has helped create.
And finally, and maybe most important, is Constellation is effectively steering the ship. Canopy’s new CEO, David Klein, is the former CFO of Constellation Brands.
The More Things Change, The More They Stay the Same
Few industries have had as difficult a time gaining traction as the cannabis industry. Ever since the stocks of major, and minor, cannabis companies went through the roof in 2018, it’s been one problem after another. The novel coronavirus that spawned the Covid-19 pandemic hit just as Canopy was beginning to recognize actual revenue from its Canadian operations.
Success in the Canadian market will go a long way to the ultimate goal of opening up the United States to both medicinal and recreational marijuana. The legal marijuana market is still very much in its infancy. And one of the reasons the training wheels are still on is because the United States is not open for business.
However, my InvestorPlace colleague Josh Enomoto referenced a study by the Pew Research Center that shows attitudes toward legalizing marijuana are changing. And since money talks, it’s not hard to imagine that once Canopy and other companies start showing a profit, political will may change.
Millennials Are Helping Prop Up CGC Stock
Canopy Growth is in the top 20 of most purchased stocks on Robinhood. Considering that millenials are the primary investors on the app, this is not surprising. This is a generation that is playing the long game when it comes to marijuana stocks. They are betting on a future where marijuana is legal. So, why not get in on the ground floor?
However, I should caution that as of this writing, Aurora Cannabis (NYSE:ACB) was tops on the list of Robinhood stocks. So, let’s not get carried away throwing bouquets. But it’s clear that this is a market that continues to believe in the marijuana story.
Be a Cannabis Realist When It Comes to CGC Stock
I consider myself to be a realist when it comes to cannabis stocks in general. I’m bullish on the long-term future of the industry. But I also know that thesis is premised on full legalization of the cannabis industry in the United States. I think CGC stock is a buy right now simply because it’s cheap and it probably has found a floor.
The continuing support of Constellation all but ensures that Canopy will be around on the other side of this pandemic. But in my opinion, investors hoping for meteoric growth in CGC stock during the second half of 2020 may be disappointed. Every cannabis company, Canopy included, is on a long road and there is no shortcut.
Chris Markoch is a freelance financial copywriter who has been covering the market for over five years. He has been writing for InvestorPlace since 2019. As of this writing, Chris Markoch did not hold a position in any of the aforementioned securities.
The post Canopy Growth Is the Definition of a Long-Term Investment appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | However, I should caution that as of this writing, Aurora Cannabis (NYSE:ACB) was tops on the list of Robinhood stocks. In a statement, Newlands wrote that “Canopy is best positioned to win in the emerging cannabis space.” And one reason for that, of course, is the cannabis-infused beverages that Constellation has helped create. Success in the Canadian market will go a long way to the ultimate goal of opening up the United States to both medicinal and recreational marijuana. | However, I should caution that as of this writing, Aurora Cannabis (NYSE:ACB) was tops on the list of Robinhood stocks. InvestorPlace - Stock Market News, Stock Advice & Trading Tips When I last wrote about Canopy Growth (NYSE:CGC) in March, CGC stock was testing three-year lows. Understanding Constellation’s Vote of Confidence Constellation CEO Bill Newlands cited three reasons for the company’s continuing investment in Canopy. | However, I should caution that as of this writing, Aurora Cannabis (NYSE:ACB) was tops on the list of Robinhood stocks. InvestorPlace - Stock Market News, Stock Advice & Trading Tips When I last wrote about Canopy Growth (NYSE:CGC) in March, CGC stock was testing three-year lows. Understanding Constellation’s Vote of Confidence Constellation CEO Bill Newlands cited three reasons for the company’s continuing investment in Canopy. | However, I should caution that as of this writing, Aurora Cannabis (NYSE:ACB) was tops on the list of Robinhood stocks. Understanding Constellation’s Vote of Confidence Constellation CEO Bill Newlands cited three reasons for the company’s continuing investment in Canopy. I think CGC stock is a buy right now simply because it’s cheap and it probably has found a floor. |
37535.0 | 2020-05-07 00:00:00 UTC | These Pot Stocks May Need to Enact a Reverse Split | ACB | https://www.nasdaq.com/articles/these-pot-stocks-may-need-to-enact-a-reverse-split-2020-05-07 | nan | nan | At this time last year, marijuana remained one of the hottest industries that investors could buy. Canada had recently legalized recreational pot, and the country was slated to introduce higher-margin derivatives later in the year. The U.S. was also expected to deliver substantive growth with lawmakers in numerous states actively engaged in legalization discussions.
Today, however, the cannabis industry is a veritable disaster. The launch of high-margin derivatives in Canada wound up being delayed, and important provinces like Ontario have struggled to create an adequate retail presence. Meanwhile, high tax rates have made it difficult for U.S. pot stocks to compete with the black market. Very little has gone right, and pot stocks have paid dearly for it, with across the board declines of 50% to 95%.
While these huge drops have some investors searching for bargains, the reality is that a handful of pot stocks listed on the New York Stock Exchange (NYSE) or Nasdaq have fallen so much that they may soon have no choice but to enact a reverse split in order to avoid being booted from these exchanges.
Image source: Getty Images.
Delisting is a real threat
Though this might sound like fearmongering, it's not. Last month, Aurora Cannabis (NYSE: ACB) announced that it would enact a 1-for-12 reverse split on or about May 11, 2020. The NYSE's continued listing rules require a minimum share price of $1, which Aurora Cannabis hasn't been able to maintain for the past two months. It also doesn't help that Aurora Cannabis has been diluting its shareholders into oblivion, thereby weighing down its share price even more. Following the upcoming reverse split, Aurora's stock should be above $8 per share.
Then there's CannTrust, which was given the heave-ho from the NYSE -- albeit an insufficient minimum average share price was far from its only concern. CannTrust wound up illegally growing marijuana in five cultivation rooms for a period of six months, and last year had Health Canada suspend its cultivation and sales licenses. To boot, CannTrust hasn't filed any financial statements in a year, with the exception of providing updates on its cash balance in sporadic news releases.
Equally worrisome, reverse splits are often viewed as a sign of weakness by Wall Street and investors. Although not all reverse splits result in a company's share price sinking even lower, it tends to happen more often than not.
Here are three NYSE-listed pot stocks that may soon need to follow in Aurora's footsteps.
Image source: Getty Images.
HEXO
First up is Quebec-based licensed producer HEXO (NYSE: HEXO), which has been trading for less than $1 for pretty much the entirety of the past two months. To be honest, I'm sort of shocked that Aurora Cannabis beat HEXO to the punch on the reverse split announcement, especially with HEXO going for a mere $0.50 per share.
Like most Canadian licensed producers, HEXO is in a world of hurt. The company wound up expanding production far more than it needed to, and now it's scrambling to raise capital and paring down its operations to match prevailing market conditions. HEXO wound up shedding 200 jobs last year, and has idled about a third of its peak production capacity. The real killer was the admission that its Newstrike Brands deal was unnecessary. This came in the form of a property, plant, equipment, and intangible assets writedown of $138.3 million Canadian, as well as a CA$111.9 million goodwill writedown in its most recent quarter.
But even with a "leaner' operation, HEXO is far from being out of the woods. Over the past couple of months, HEXO has sold its common stock to raise capital at levels that were well below the prior day's closing price. This isn't a company that's just trying to stay listed on the NYSE – it's trying to do everything it can to simply survive, in my view. That makes HEXO a stock you'll want to avoid like the plague for the foreseeable future.
Image source: Getty Images.
OrganiGram Holdings
Next up is New Brunswick-based OrganiGram Holdings (NASDAQ: OGI), which ended May 5 at $1.49 per share – mere pennies from its 52-week low. Similar to the NYSE, the Nasdaq requires that listed securities maintain a $1 average share price over a 30-day period or risk being booted from the exchange.
Even though OrganiGram is the only licensed producer in Canada that I believe is worth owning, it's not without its share of problems in the near term. Supply bottlenecks in Ontario and derivative launch delays have not allowed the company to get its cannabis products into nearly enough retail locations.
Furthermore, OrganiGram announced in its fiscal second-quarter press release that it's in violation of one of its financial covenants on a term loan. While hope its high (pardon the pun) that OrganiGram will resolve this issue, the company may need to raise substantive capital in the meantime. Roughly a week after its Q2 2020 report, the company announced a CA$49 million at-the-market equity program that'll allow it to sell common stock to raise capital. In other words, it'll be diluting its shareholders just like its peers.
The one bright spot here is OrganiGram's only production facility, Moncton. The use of a three-tiered growing system should make it one of the most efficient grow sites on the basis of yield per square foot. Additionally, having only one production facility should make it easier for OrganiGram to adjust its expenses to match prevailing market conditions. Nevertheless, this may not prevent the eventual need for a reverse split.
Image source: Getty Images.
Aphria
Finally, there's Canadian licensed producer Aphria (NYSE: APHA), which was going for $3.60 a share, as of May 5. Though this appears to be a healthy buffer above the $1 minimum listing requirement for the NYSE, Aphria traded below $2 as recently as mid-March. Also, some Wall Street investment banks won't invest in a company with a sub-$5 share price. That gives Aphria a dual motivation to consider a reverse split.
One reason the company may be hesitant to do so is the fact that its operating reports have been coming in better-than-expected. Net cannabis revenue soared 65% on a sequential quarterly basis during the third quarter, with total sales nearly doubling and the company reporting CA$5.7 in net income. Such results would not suggest that Aphria is operating from a position of weakness, as is the case with HEXO and Aurora.
However, the bulk of Aphria's revenue continues to be derived from its pharmaceutical distribution subsidiary CC Pharma. Pharmaceutical distribution revenue can be lumpy at times, and it's relatively low margin. To date, we haven't seen Aphria's cannabis operations consistently deliver an operating profit without the assistance of one-time benefits or fair-value adjustments. Until that happens for this cannabis stock, there exists the real possibility that a reverse split may be needed to keep its stock on the radar of investment banks.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Sean Williams owns shares of CannTrust Holdings, Inc. The Motley Fool owns shares of and recommends OrganiGram Holdings. The Motley Fool recommends CannTrust Holdings Inc, HEXO., and Nasdaq. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Last month, Aurora Cannabis (NYSE: ACB) announced that it would enact a 1-for-12 reverse split on or about May 11, 2020. To boot, CannTrust hasn't filed any financial statements in a year, with the exception of providing updates on its cash balance in sporadic news releases. Over the past couple of months, HEXO has sold its common stock to raise capital at levels that were well below the prior day's closing price. | Last month, Aurora Cannabis (NYSE: ACB) announced that it would enact a 1-for-12 reverse split on or about May 11, 2020. The NYSE's continued listing rules require a minimum share price of $1, which Aurora Cannabis hasn't been able to maintain for the past two months. Similar to the NYSE, the Nasdaq requires that listed securities maintain a $1 average share price over a 30-day period or risk being booted from the exchange. | Last month, Aurora Cannabis (NYSE: ACB) announced that it would enact a 1-for-12 reverse split on or about May 11, 2020. While these huge drops have some investors searching for bargains, the reality is that a handful of pot stocks listed on the New York Stock Exchange (NYSE) or Nasdaq have fallen so much that they may soon have no choice but to enact a reverse split in order to avoid being booted from these exchanges. To be honest, I'm sort of shocked that Aurora Cannabis beat HEXO to the punch on the reverse split announcement, especially with HEXO going for a mere $0.50 per share. | Last month, Aurora Cannabis (NYSE: ACB) announced that it would enact a 1-for-12 reverse split on or about May 11, 2020. The NYSE's continued listing rules require a minimum share price of $1, which Aurora Cannabis hasn't been able to maintain for the past two months. Roughly a week after its Q2 2020 report, the company announced a CA$49 million at-the-market equity program that'll allow it to sell common stock to raise capital. |
37536.0 | 2020-05-05 00:00:00 UTC | Aurora Cannabis May Need to Write Down $1 Billion Tied to Its MedReleaf Acquisition | ACB | https://www.nasdaq.com/articles/aurora-cannabis-may-need-to-write-down-%241-billion-tied-to-its-medreleaf-acquisition-2020 | nan | nan | Pardon the pun, but at this time last year hopes were incredibly high for the legal marijuana industry. Our neighbor to the north was preparing for the launch of high-margin derivative products, such as vapes, edibles, and infused beverages, while in the U.S. numerous states were in the process of pushing forward measures that would legalize medical or recreational pot. With tens of billions in weed sales conducted annually in the black market, the door appeared wide open for the legal market to capture a big piece of this pie.
But this wasn't to be the case. The North American pot industry has struggled under the weight of high tax rates on legal product, production shortages and/or bottlenecks, regulatory delays, and the inability to access traditional forms of financing.
Perhaps no company has been the poster-child of this disappointment more than Alberta's Aurora Cannabis (NYSE: ACB).
Image source: Getty Images.
Aurora's acquisition binge hasn't paid off
At one time, Aurora was the cream of the crop. Its 15 production facilities were expected to produce no less than 660,000 kilos per year, in aggregate, at their peak, with Aurora having access to two dozen markets outside of Canada. This international presence was expected to be the key to the company's success. In effect, it would ensure that domestic oversupply never threatened the company's operating margins.
Unfortunately, next to nothing has gone right. The launch of high-margin derivatives was delayed in Canada, and Health Canada hasn't exactly been proficient in approving cultivation and sales licenses in a timely manner. Meanwhile, certain provinces (ahem, Ontario) have sabotaged sales by licensing far too few retail locations. In short, Aurora's perceived-to-be leading production simply hasn't been needed.
That's a problem, because no marijuana stock was more gung-ho on the production expansion front than Aurora Cannabis. Although it does have a handful of organic projects, such as the 800,000-square-foot Aurora Sky facility that's capable of more than 100,000 kilos of output per year, most of the company's growth was the result of an aggressive acquisition strategy. The issue is that, in hindsight, virtually all of these deals turned out to be grossly overpriced. None more so than the all-stock acquisition of licensed producer MedReleaf, which was closed in July 2018.
Image source: Getty Images.
Why did Aurora buy MedReleaf?
The logic behind the MedReleaf deal was simple: MedReleaf was looking to sell itself for the right price, and Aurora Cannabis was angling to be Canada's top producer.
MedReleaf offered two facilities (formerly known as Markham and Bradford) that spanned 55,000 square feet and 210,000 square feet, respectively, and would produce a combined 35,000 kilos of marijuana per year.
MedReleaf had also recently closed on a 164-acre purchase that contained the 1-million-square-foot Exeter facility. Exeter is a vegetable-growing greenhouse seated on 69 acres that, if retrofit to grow cannabis, could yield in the neighborhood of 105,000 kilos per year. In other words, Aurora was effectively buying 140,000 kilos of peak annual output and a handful of unique cannabis brands for what worked out to CA$2.64 billion in stock (about $1.87 billion U.S., as of May 3, 2020).
Eventually, Aurora Cannabis wound up classifying approximately CA$2 billion of the purchase price as goodwill -- i.e., premium above and beyond tangible assets. The idea being that Aurora would retrofit Exeter for cannabis production, potentially build another facility adjacent to Exeter on the remaining 95 acres of land, build up MedReleaf's existing brands, and reap healthy amounts of cash flow from Markham and Bradford. Through all of these actions, it would recoup its goodwill and look like a genius.
Image source: Getty Images.
The MedReleaf deal could sink Aurora Cannabis
But little of this plan has come to fruition, some of it through no fault of Aurora's. As noted, Canada's regulatory issues have plagued the rollout of dried cannabis flower and higher-margin derivatives throughout key provinces in Canada. This meant Aurora had to make some tough choices, one of which was to not move forward with the retrofit of Exeter and to, instead, sell the 164-acre property inherited from the MedReleaf deal. The CA$17 million asking price still hasn't been met, as of this past weekend.
While it was always going to be a costly project to get Exeter retrofit for pot production, the 105,000 kilos of peak annual output from this facility was the main reason Aurora paid so much for MedReleaf. Even if the company somehow gets its meager asking price of CA$17, its net purchase price will still be about CA$2.62 billion.
What has Aurora ultimately wound up with for that CA$2.62 billion? A handful of brand-name products and 35,000 kilos of annual output. According to MedReleaf's annual filing prior to the closing of the deal, it also had about CA$358 million in assets and nearly CA$49 million in liabilities. No matter how you rearrange the puzzle pieces, it's not even remotely close to CA$2.62 billion.
Canadian licensed producers Flowr Corp. and Supreme Cannabis Company both have the capability to produce 50,000 kilos annually at their peak, and their market caps are a respective $50 million and $73 million (both in U.S.). Keep in mind Markham and Bradford are capable of only 35,000 kilos combined. That should offer some idea of what these facilities are really worth at the moment.
Taking into account depressed valuations for property, plant, and equipment, and of course the unused Exeter facility and adjacent land, I don't see any scenario that doesn't involve a future writedown of at least $1 billion (about CA$1.41 billion). To be honest, this $1 billion figure is being generous, as it assumes a real value of CA$1.2 billion for MedReleaf, which I still believe is about 50% too high.
The point is, the MedReleaf deal has been absolutely awful for Aurora shareholders, and there's a very good chance it's not done wreaking havoc on the company's operating results or balance sheet.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Sean Williams has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Perhaps no company has been the poster-child of this disappointment more than Alberta's Aurora Cannabis (NYSE: ACB). Our neighbor to the north was preparing for the launch of high-margin derivative products, such as vapes, edibles, and infused beverages, while in the U.S. numerous states were in the process of pushing forward measures that would legalize medical or recreational pot. Although it does have a handful of organic projects, such as the 800,000-square-foot Aurora Sky facility that's capable of more than 100,000 kilos of output per year, most of the company's growth was the result of an aggressive acquisition strategy. | Perhaps no company has been the poster-child of this disappointment more than Alberta's Aurora Cannabis (NYSE: ACB). MedReleaf offered two facilities (formerly known as Markham and Bradford) that spanned 55,000 square feet and 210,000 square feet, respectively, and would produce a combined 35,000 kilos of marijuana per year. In other words, Aurora was effectively buying 140,000 kilos of peak annual output and a handful of unique cannabis brands for what worked out to CA$2.64 billion in stock (about $1.87 billion U.S., as of May 3, 2020). | Perhaps no company has been the poster-child of this disappointment more than Alberta's Aurora Cannabis (NYSE: ACB). In other words, Aurora was effectively buying 140,000 kilos of peak annual output and a handful of unique cannabis brands for what worked out to CA$2.64 billion in stock (about $1.87 billion U.S., as of May 3, 2020). The idea being that Aurora would retrofit Exeter for cannabis production, potentially build another facility adjacent to Exeter on the remaining 95 acres of land, build up MedReleaf's existing brands, and reap healthy amounts of cash flow from Markham and Bradford. | Perhaps no company has been the poster-child of this disappointment more than Alberta's Aurora Cannabis (NYSE: ACB). Its 15 production facilities were expected to produce no less than 660,000 kilos per year, in aggregate, at their peak, with Aurora having access to two dozen markets outside of Canada. In other words, Aurora was effectively buying 140,000 kilos of peak annual output and a handful of unique cannabis brands for what worked out to CA$2.64 billion in stock (about $1.87 billion U.S., as of May 3, 2020). |
37537.0 | 2020-05-04 00:00:00 UTC | Why Aurora Cannabis Is Focusing Sharply on Costs | ACB | https://www.nasdaq.com/articles/why-aurora-cannabis-is-focusing-sharply-on-costs-2020-05-04 | nan | nan | InvestorPlace - Stock Market News, Stock Advice & Trading Tips
Investing in the cannabis sector remains a speculative and risky bet but as consolidation unfolds, the stronger players might pay off. When shares of Aurora Cannabis (NYSE:ACB) fell below the key $1 level, it might have mark an end to the downtrend. The company has a plan to increase its financial liquidity. So, reverse-splitting the stock to keep its listing may help Aurora stock survive the ongoing selloff in the cannabis sector.
Source: ElRoi / Shutterstock.com
Cash Raise
Aurora posted a few weeks ago its plans on increasing its financial flexibility in response to the elevated economic uncertainty. The 205 million CAD in cash remaining included the $400 million raised from the at-the-market (ATM) offering program announced last year.
But to strengthen its balance sheet and ensure continued access to equity capital, it will renew the ATM program. Aurora does not have the luxury that Cronos Group (NASDAQ:CRON) and Canopy Growth (NYSE:CGC) enjoy. The latter firms have investments from Altria (NYSE:MO) and Constellation Brands (NYSE:STZ), respectively.
And so, Aurora needs to tap the public markets to increase up to $350 million. Strengthening the balance sheet will allay fears of bankruptcy or a cash crunch as the new coronavirus weakens the economy.
9 Healthcare Stocks to Buy Even After the Coronavirus Fades
Aurora also said that its cost cuts are on target. The lower selling, general, and administrative cost reductions and lower capital expenditures should align with falling revenue. That should stop the company from suffering from more losses.
The company expects SG&A costs in the range of 40 million CAD to 45 million CAD a quarter as it exits fiscal fourth quarter of 2020. It will achieve this by reducing unnecessary complexities in its business. Needless to say, a culture of financial discipline will go a long way in driving the company toward profitability.
Working Through Pandemic
Aurora’s facilities in Canada and internationally continued full operations. Thanks to the government categorizing the business as essential, Aurora continued its business activities while staff practiced social distancing. The company also implemented extra health screening of its employees to keep all staff safe.
Customers, many of whom are following the stay-at-home government order, may have increased orders of cannabis products. When Aurora reports quarterly results in a little over a week from now, investors may find the company reporting improving revenues.
Growth Opportunity
The rollout of 2.0 is improving after the company solved operational issues such as packaging. It is now positioned to get the product to the customer. Still, Aurora needs to operate at a point where it is not producing around 50,000 kilograms more than it sold, as it did in Q2 2020.
It needs to have a better understanding of the pace of the store rollout in Canada and then match supply with demand levels. Plus, Aurora needs to drive higher revenue while operating at lower SG&A levels. It said on the conference call that “we are aiming to being prudent with our cost structure that allow us to be profitable on the entire journey as opposed to hoping for doubling of revenues to become profit[able] or not.”
InvestorPlace market analyst Luke Lango thinks that Aurora’s business will rebound in the second half of the year. But he also prefers CRON and CGC stock more.
Investors should expect Aurora to get better control on costs first. As it achieves operational efficiency and it keeps inventory levels low, profits will come next.
Fair Value and Your Takeaway
Analysts have an average price target of $1.69 on Aurora stock (per Tipranks). The stock is a wait and see until the company reports higher margins. Until then, speculators may continue trading its volatility and holding for the long-term when prospects improve.
Chris Lau, contributing author for InvestorPlace.com and numerous other financial sites. Chris has over 20 years of investing experience in the stock market and runs the Do-It-Yourself Value Investing Marketplace on Seeking Alpha. He shares his stock picks so readers get original insight that helps improve investment returns. As of this writing, the author did not hold a position in any of the aforementioned securities.
The post Why Aurora Cannabis Is Focusing Sharply on Costs appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | When shares of Aurora Cannabis (NYSE:ACB) fell below the key $1 level, it might have mark an end to the downtrend. Source: ElRoi / Shutterstock.com Cash Raise Aurora posted a few weeks ago its plans on increasing its financial flexibility in response to the elevated economic uncertainty. But to strengthen its balance sheet and ensure continued access to equity capital, it will renew the ATM program. | When shares of Aurora Cannabis (NYSE:ACB) fell below the key $1 level, it might have mark an end to the downtrend. InvestorPlace - Stock Market News, Stock Advice & Trading Tips Investing in the cannabis sector remains a speculative and risky bet but as consolidation unfolds, the stronger players might pay off. Source: ElRoi / Shutterstock.com Cash Raise Aurora posted a few weeks ago its plans on increasing its financial flexibility in response to the elevated economic uncertainty. | When shares of Aurora Cannabis (NYSE:ACB) fell below the key $1 level, it might have mark an end to the downtrend. So, reverse-splitting the stock to keep its listing may help Aurora stock survive the ongoing selloff in the cannabis sector. When Aurora reports quarterly results in a little over a week from now, investors may find the company reporting improving revenues. | When shares of Aurora Cannabis (NYSE:ACB) fell below the key $1 level, it might have mark an end to the downtrend. InvestorPlace - Stock Market News, Stock Advice & Trading Tips Investing in the cannabis sector remains a speculative and risky bet but as consolidation unfolds, the stronger players might pay off. The latter firms have investments from Altria (NYSE:MO) and Constellation Brands (NYSE:STZ), respectively. |
37538.0 | 2020-05-03 00:00:00 UTC | Why Aurora Cannabis Stock Plunged 18% in April | ACB | https://www.nasdaq.com/articles/why-aurora-cannabis-stock-plunged-18-in-april-2020-05-03 | nan | nan | What happened
Shares of Aurora Cannabis (NYSE: ACB) lost nearly 20% of their value in April, even as the S&P 500 gained more than 12%. A host of maladies have combined to crush the popular marijuana stock.
So what
Ontario, Canada's most populous province, forced marijuana dispensaries to close on April 4 as part of its efforts to stem the spread of COVID-19, the disease caused by the novel coronavirus. Although the pot shops were allowed to reopen a few days later, only phone and online orders were permitted. The situation worsened what had already been a shortage of cannabis retail outlets in Canada, which has resulted in supply overages for major marijuana producers like Aurora.
The lack of retail outlets is particularly damaging to Aurora, which has seen its cash reserves dwindle following hefty operating losses. Investors are rightfully concerned that the cannabis giant could run out of cash.
Aurora Cannabis is rapidly burning through cash. Image source: Getty Images.
Now what
With its shares down another 5% already in May, Aurora's stock price is now down a brutal 67% so far in 2020 -- and more than 90% over the past year. Yet more pain might lie ahead.
Aurora has been forced to cut costs by ceasing the construction of some of its most promising production facilities, selling off other cannabis production assets, and laying off hundreds of workers. Yet despite these actions, Aurora's path to profitability remains uncertain.
The beleaguered cannabis company is once again turning to share issuances to raise cash, which will probably further dilute shareholders. Worse still, insiders appear to be bailing out of the stock.
For all of these reasons -- and with more losses likely on the horizon -- Aurora Cannabis' investors might want to consider selling their shares.
10 stocks we like better than Aurora Cannabis Inc.
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Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | What happened Shares of Aurora Cannabis (NYSE: ACB) lost nearly 20% of their value in April, even as the S&P 500 gained more than 12%. So what Ontario, Canada's most populous province, forced marijuana dispensaries to close on April 4 as part of its efforts to stem the spread of COVID-19, the disease caused by the novel coronavirus. The situation worsened what had already been a shortage of cannabis retail outlets in Canada, which has resulted in supply overages for major marijuana producers like Aurora. | What happened Shares of Aurora Cannabis (NYSE: ACB) lost nearly 20% of their value in April, even as the S&P 500 gained more than 12%. The situation worsened what had already been a shortage of cannabis retail outlets in Canada, which has resulted in supply overages for major marijuana producers like Aurora. For all of these reasons -- and with more losses likely on the horizon -- Aurora Cannabis' investors might want to consider selling their shares. | What happened Shares of Aurora Cannabis (NYSE: ACB) lost nearly 20% of their value in April, even as the S&P 500 gained more than 12%. 10 stocks we like better than Aurora Cannabis Inc. * David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Aurora Cannabis Inc. wasn't one of them! | What happened Shares of Aurora Cannabis (NYSE: ACB) lost nearly 20% of their value in April, even as the S&P 500 gained more than 12%. For all of these reasons -- and with more losses likely on the horizon -- Aurora Cannabis' investors might want to consider selling their shares. 10 stocks we like better than Aurora Cannabis Inc. |
37539.0 | 2020-05-03 00:00:00 UTC | Is Innovative Industrial Properties the Best Pot Stock to Buy Right Now? | ACB | https://www.nasdaq.com/articles/is-innovative-industrial-properties-the-best-pot-stock-to-buy-right-now-2020-05-03 | nan | nan | Cannabis stocks have largely been getting clobbered in 2020, because of both the coronavirus-driven market sell-off and growing pains within the young industry. However, there's still reason to believe there will be at least a couple of big longer term winners among the group.
The legalization movement seems poised to continue to make steady progress. The number of U.S. states giving the green light to marijuana for medical and recreational purposes should continue to increase. In fact, the COVID-19 pandemic could accelerate this process. The crisis is going to leave many states hurting financially, and the tax revenue they could generate from legalizing marijuana is going to be looking mighty attractive.
Eventually, it seems probable that the substance will be legalized on a federal level in the United States and in other countries, too.
Cannabis stocks aren't for all investors as the group is volatile and risky. But for those who want exposure to the space, the best stock to consider buying now is Innovative Industrial Properties (NYSE: IIPR), a cannabis-focused real estate investment trust (REIT).
Image source: Getty Images.
Major cannabis stocks: Key stats
Context is important. So before we dive into Innovative Industrial Properties, or IIP, here's how its stock stacks up on some key metrics to the stocks of the largest three cannabis growers by market cap. All three are based in Canada, while IIP is a U.S. company.
COMPANY
MARKET CAP
PROFITABLE ON A TTM OPERATING BASIS?
YTD 2020 RETURN (LOSS)
3-YEAR RETURN (LOSS)
Innovative Industrial Properties $1.3 billion
Yes
4.7% 383%
Canopy Growth $5.6 billion No (24.1%) 140%
Cronos Group
$2.1 billion
No
(22.6%) 201%
Aurora Cannabis $972 million No (65.7%) (61%)
S&P 500
-- -- (9.3%) 29.7%
Data sources: Yahoo! Finance and YCharts. Data as of April 30, 2020. TTM = trailing 12 months. YTD = year to date.
Innovative Industrial Properties' business
IIP buys properties in U.S. states where medical marijuana is legal and leases them to state-licensed operators using long-term, triple-net leases. It owned 51 properties located in 15 states, which were 98.9% leased (based on square footage), as of the release of its fourth-quarter 2019 results on Feb. 26. Most of these properties are industrial and used for growing and processing cannabis, though there are several retail properties in its portfolio.
Why Innovative Industrial Properties is the best cannabis stock
There are two key reasons why IIP stands out from others in the cannabis group: It's profitable, a rarity in the space, and it pays a dividend. It's the only cannabis stock, at least the only pure play, that pays a dividend, I believe. These two factors make the stock less risky than most other marijuana stocks.
In 2019, IIP's revenue rocketed 202% year over year to $44.7 million, driven primarily by acquisitions, though rental increases contributed. Net income soared 293% to $22.1 million, which translated to earnings per share (EPS) increasing 171% to $2.03. Adjusted funds from operations (AFFO) surged 259% to $34.9 million, which translated to AFFO per share rising 144% to $3.27. (FFO is a key watched metric for REITs, as it's the driver of dividend changes.)
IIP's dividend is yielding approximately 5%. As long as the company remains profitable, investors can count on it paying a dividend. REITs are required to pay out at least 90% of their taxable income each year as dividends to shareholders in return for their special tax treatment.
IIP has a unique tailwind: U.S. companies directly involved with marijuana have a difficult time obtaining financing from traditional sources, such as banks, because the substance isn't legal on the federal level. IIP's lease-buyback transactions provide cannabis operators with cash that they can use to grow their business.
Marijuana's legalization on a federal level has the potential to put a dent in the company's profitability because that event will increase funding options for cannabis operators. That said, there are many successful REITs in other industries, so there's no reason to believe IIP won't still have the potential to be quite successful over the long haul.
Wall Street expects IIP to grow earnings nearly 88% this year and more than 44% next year. Shares are trading at 20 times forward earnings, an attractive price assuming the company can continue to post solid profitable growth.
IIP should continue to be less volatile and risky than others in the cannabis group. But the space in general is volatile and risky, so keep this in mind when making investing decisions.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Beth McKenna has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Innovative Industrial Properties. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | But for those who want exposure to the space, the best stock to consider buying now is Innovative Industrial Properties (NYSE: IIPR), a cannabis-focused real estate investment trust (REIT). IIP has a unique tailwind: U.S. companies directly involved with marijuana have a difficult time obtaining financing from traditional sources, such as banks, because the substance isn't legal on the federal level. Marijuana's legalization on a federal level has the potential to put a dent in the company's profitability because that event will increase funding options for cannabis operators. | Innovative Industrial Properties $1.3 billion Yes 4.7% 383% Canopy Growth $5.6 billion No (24.1%) 140% Cronos Group $2.1 billion No (22.6%) 201% Aurora Cannabis $972 million No (65.7%) (61%) Innovative Industrial Properties' business IIP buys properties in U.S. states where medical marijuana is legal and leases them to state-licensed operators using long-term, triple-net leases. The Motley Fool owns shares of and recommends Innovative Industrial Properties. | So before we dive into Innovative Industrial Properties, or IIP, here's how its stock stacks up on some key metrics to the stocks of the largest three cannabis growers by market cap. Innovative Industrial Properties' business IIP buys properties in U.S. states where medical marijuana is legal and leases them to state-licensed operators using long-term, triple-net leases. Why Innovative Industrial Properties is the best cannabis stock There are two key reasons why IIP stands out from others in the cannabis group: It's profitable, a rarity in the space, and it pays a dividend. | Why Innovative Industrial Properties is the best cannabis stock There are two key reasons why IIP stands out from others in the cannabis group: It's profitable, a rarity in the space, and it pays a dividend. IIP should continue to be less volatile and risky than others in the cannabis group. Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018. |
37540.0 | 2020-05-03 00:00:00 UTC | 1 Big Risk You've Got to Be Prepared to Take if You Want to Invest in Cannabis | ACB | https://www.nasdaq.com/articles/1-big-risk-youve-got-to-be-prepared-to-take-if-you-want-to-invest-in-cannabis-2020-05-03 | nan | nan | Investing in cannabis stocks is not for the faint of heart. The industry can take investors on a roller-coaster ride, and it can be a nightmare for those who are looking for stable, long-term growth. That said, this new space has a lot of potential, especially as more U.S. states legalize pot and countries around the world continue to loosen marijuana laws. In February 2020, Grand View Research projected that the legal marijuana market would grow to reach $73.6 billion by 2027 (in 2018, it was worth $10.6 billion).
But before you consider investing in cannabis, there's one risk that you have to be wary of -- yet willing to accept:
Pot stocks can crash without warning
Large, single-day declines are not uncommon for cannabis stocks, and there's no way for investors to prepare for them. When the CannTrust scandal broke nearly a year ago, it came out of nowhere, and the stock went from more than $5 to less than $2 in weeks. Twice during the month of July, the stock fell by more than 20%.
More recently, iAnthus shares fell off a cliff in April when the New York-based cannabis company defaulted on an interest payment, saying that it's facing "liquidity constraints." With cash flow heavily on the minds of cannabis investors, it's perhaps not shocking that the stock crashed. What was shocking was just how bad it was: In one day, the stock fell by a whopping 62%.
Image source: Getty Images.
But it doesn't have to be insolvency or the risk of bankruptcy that sends pot stocks cratering. Disappointing quarterly results and failure to meet forecasts can lead to tailspins as well. When Canadian pot producer HEXO announced in October that it was pulling its forecast for the year as a result of "uncertainties in the marketplace," its share price tumbled 23% in one day.
And when Aurora Cannabis (NYSE: ACB) released disappointing first-quarter results back on Nov. 14, the stock was hammered in the days that followed -- down by 17% the next day, and another 16% the day after that. In two days, its share price went from $3.29 to $2.28, down a total of 31%.
Why should investors care?
Pot stocks are volatile, and some investors will point to the fact that while many of them have bad days, they also have very good ones as well, with double-digit price increases. But in many of these cases, one "bad day" is just the beginning (or a continuation) of a much larger decline. Today, Aurora's stock price struggles to stay above $0.70. The stock is down 92% in the past 12 months. It's performed even worse than the abysmal Horizons Marijuana Life Sciences ETF (OTC: HMLSF), which is down more than 70% in the same time.
Large movements in price, in just one or two days, are often signs that something's gone terribly wrong for a company. And when pessimism is high, the bears come out in full force, making the struggling stock a prime target for short sellers who hope to send it even lower. In Aurora's case, there's no telling where the bottom is -- the stock has continued to find ways to fall further and further down.
As attractive as some pot stocks may look today given their reduced valuations, all it takes is a scandal, a disappointing performance, or the suggestion that a company is running low on cash to send investors into a panic. So while the opportunities for long-term growth in the industry are promising, that doesn't mean it's safe to invest in cannabis stocks. The industry is constantly evolving, and companies that are here today may not be around years from now.
Investors who buy pot stocks need to accept the serious risks involved, including the possibility that they may incur significant losses. As the industry matures and companies become profitable, investing in cannabis will become safer. But for now, investors will want to keep a close eye on any cannabis companies that they hold in their portfolios, because there may be little, if any, warning if things go south.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake -- it is coming.
Cannabis legalization is sweeping over North America -- 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
David Jagielski has no position in any of the stocks mentioned. The Motley Fool recommends CannTrust Holdings Inc and HEXO. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | And when Aurora Cannabis (NYSE: ACB) released disappointing first-quarter results back on Nov. 14, the stock was hammered in the days that followed -- down by 17% the next day, and another 16% the day after that. When Canadian pot producer HEXO announced in October that it was pulling its forecast for the year as a result of "uncertainties in the marketplace," its share price tumbled 23% in one day. And when pessimism is high, the bears come out in full force, making the struggling stock a prime target for short sellers who hope to send it even lower. | And when Aurora Cannabis (NYSE: ACB) released disappointing first-quarter results back on Nov. 14, the stock was hammered in the days that followed -- down by 17% the next day, and another 16% the day after that. But before you consider investing in cannabis, there's one risk that you have to be wary of -- yet willing to accept: Pot stocks can crash without warning Large, single-day declines are not uncommon for cannabis stocks, and there's no way for investors to prepare for them. Today, Aurora's stock price struggles to stay above $0.70. | And when Aurora Cannabis (NYSE: ACB) released disappointing first-quarter results back on Nov. 14, the stock was hammered in the days that followed -- down by 17% the next day, and another 16% the day after that. But before you consider investing in cannabis, there's one risk that you have to be wary of -- yet willing to accept: Pot stocks can crash without warning Large, single-day declines are not uncommon for cannabis stocks, and there's no way for investors to prepare for them. As attractive as some pot stocks may look today given their reduced valuations, all it takes is a scandal, a disappointing performance, or the suggestion that a company is running low on cash to send investors into a panic. | And when Aurora Cannabis (NYSE: ACB) released disappointing first-quarter results back on Nov. 14, the stock was hammered in the days that followed -- down by 17% the next day, and another 16% the day after that. But before you consider investing in cannabis, there's one risk that you have to be wary of -- yet willing to accept: Pot stocks can crash without warning Large, single-day declines are not uncommon for cannabis stocks, and there's no way for investors to prepare for them. The industry is constantly evolving, and companies that are here today may not be around years from now. |
37541.0 | 2020-05-02 00:00:00 UTC | Why Aurora Cannabis Should Reduce Its Global Footprint, Too | ACB | https://www.nasdaq.com/articles/why-aurora-cannabis-should-reduce-its-global-footprint-too-2020-05-02 | nan | nan | Aurora Cannabis (NYSE: ACB) needs to improve its performance this year. There's just no way around that. The stock is down more than 65% in the first four months of 2020; it's performing much worse than the Horizons Marijuana Life Sciences ETF (OTC: HMLSF), which has declined by just 28%.
The company needs a way to rally investors, and there's no better way to do so than by improving on its financials; the pot producer's recorded an operating loss in every one of its past 10 quarterly results. And with little -- if any -- sales growth expected next quarter, it'll need to be more aggressive on the cost-cutting side of things in order to do that. That could mean taking a page out of Canopy Growth's (NYSE: CGC) playbook and cutting back on its international operations.
Slashing costs is the only option this year
Canopy Growth is in a much better position than Aurora Cannabis. Not only does it have a key investor, Constellation Brands (NYSE: STZ), at its disposal -- the beverage giant invested $4 billion in the company back in 2018 -- but the Ontario-based pot producer's also sitting on 1.6 billion Canadian dollars in cash and cash equivalents as of Dec. 31. In contrast, Aurora's failed to find a partner of its own, and as of March 31, it said its cash balance was CA$205 million.
But a big cash balance isn't sufficient for Canopy Growth's new CEO, David Klein, who's come over from Constellation Brands. The new boss is slashing costs left and right. This year, management has announced that it will be exiting some markets, scaling back operations in others, and continuing to lay off staff. In April, Canopy Growth announced 200 layoffs at locations in North America and the United Kingdom; in the previous month, it announced layoffs totaling 500 employees.
Image source: Getty Images.
Aurora announced its own cuts in February, when it said it would cut 500 positions (revealing at the same time that its CEO, Terry Booth, would be retiring as well). But given that Aurora may only have a few months of cash flow left according to investment bank Ello Capital, deeper cuts are likely warranted. While cannabis sales in Canada have been strong during the coronavirus pandemic, it's not a trend that may be sustainable, especially as job losses continue to mount.
That's why in order for Aurora to improve its financials and give new investors a reason to invest in the company this year, it's going to need to be a lot leaner and more efficient. And that means scaling back on operations, especially those that aren't critical.
Why the company's international operations should be fair game for cutbacks
Aurora's prided itself on its large global footprint, and it does have a presence in more than two dozen countries. But markets outside Canada, its home, are just not that developed. Canada and Uruguay are still the only countries where recreational marijuana is legal at the federal level. Divesting and cutting back overhead and costs associated with its international operations could help the company simplify its operations while making strides in bringing its expenses down.
During the six-month period ending Dec. 31, Aurora generated CA$131.3 million in net revenue. Of that total, CA$122.4 million, or 93% of sales, came from Canada. The European market contributed just CA$8 million in revenue, while other markets added CA$0.9 million. While international markets may play a key role in the company's long-term growth and future, Aurora may not be around long enough to see that growth come to fruition if it continues to churn out losses and burn through cash flow along the way.
Why investors should care
Aurora announced in April that it would be looking to raise more capital in order to "provide further balance sheet strength and preserve flexibility." In short, this means investors can expect more shares issued and more dilution in the company's future. And that's going to send the stock even lower. Until Aurora makes deep cuts to its operations to help it generate positive cash flow, investors could be facing a lot more pain in 2020.
Following in the footsteps of rival pot stock Canopy Growth may not be such a bad idea. Making more aggressive moves could win back investors, because at this point, there's not a whole lot of reason to be bullish on Aurora.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
David Jagielski has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Constellation Brands. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Aurora Cannabis (NYSE: ACB) needs to improve its performance this year. That's why in order for Aurora to improve its financials and give new investors a reason to invest in the company this year, it's going to need to be a lot leaner and more efficient. Why the company's international operations should be fair game for cutbacks Aurora's prided itself on its large global footprint, and it does have a presence in more than two dozen countries. | Aurora Cannabis (NYSE: ACB) needs to improve its performance this year. Not only does it have a key investor, Constellation Brands (NYSE: STZ), at its disposal -- the beverage giant invested $4 billion in the company back in 2018 -- but the Ontario-based pot producer's also sitting on 1.6 billion Canadian dollars in cash and cash equivalents as of Dec. 31. But a big cash balance isn't sufficient for Canopy Growth's new CEO, David Klein, who's come over from Constellation Brands. | Aurora Cannabis (NYSE: ACB) needs to improve its performance this year. Not only does it have a key investor, Constellation Brands (NYSE: STZ), at its disposal -- the beverage giant invested $4 billion in the company back in 2018 -- but the Ontario-based pot producer's also sitting on 1.6 billion Canadian dollars in cash and cash equivalents as of Dec. 31. While international markets may play a key role in the company's long-term growth and future, Aurora may not be around long enough to see that growth come to fruition if it continues to churn out losses and burn through cash flow along the way. | Aurora Cannabis (NYSE: ACB) needs to improve its performance this year. Divesting and cutting back overhead and costs associated with its international operations could help the company simplify its operations while making strides in bringing its expenses down. Of that total, CA$122.4 million, or 93% of sales, came from Canada. |
37542.0 | 2020-04-30 00:00:00 UTC | I Still Have Faith in OrganiGram! | ACB | https://www.nasdaq.com/articles/i-still-have-faith-in-organigram-2020-04-30 | nan | nan | Before you conclude that marijuana stocks are unprofitable investments this year, let me tell you why I think OrganiGram (NASDAQ: OGI) is a good pick for 2020.
Why does no one want to look at a smaller cannabis company?
Who wants to look at the smaller cannabis companies when everyone is eyeing what the bigger players -- think Aurora Cannabis (NYSE: ACB) and Canopy Growth (NYSE: CGC) -- are up to? For instance, Canopy Growth's partnership with Constellation Brands and its attempt to develop CBD-based beverages has attracted attention. Meanwhile, Aurora Cannabis -- which became investors' favorite in 2019 when it ramped up production -- has plummeted this year with rising debt, dire financial results, and leadership changes.
OrganiGram is certainly a smaller company by market capitalization; as of April 29, its market cap is just $278.3 million, compared with Canopy Growth's $5.9 billion. However, OrganiGram's consistent revenue growth and management's confidence in the eventual profitability of its cannabis 2.0 product portfolio are what give me continued faith in the company. Meanwhile, peers are seeing falling revenue and negative profitability.
Image Source: Getty Images.
OrganiGram's revenue growth has been consistent
OrganiGram has shown consistent growth in revenue despite industry headwinds. Revenue increased in all four quarters of fiscal 2019. Many cannabis companies justified their lower 2019 revenues by blaming an increase in illegal cannabis sales and a slower-than-expected store rollout in Canada, where strict regulations led to delays in the opening of more legal shops. But OrganiGram seemed unaffected; in the first quarter of fiscal 2020, revenue was up 103.2% year over year, to 25.2 million Canadian dollars. OrganiGram also reported a positive EBITDA of CA$4.8 million.
However, the recent second-quarter results were disastrous.
Second-quarter results tumbled -- why?
OrganiGram reported a year-over-year revenue decline of 13.7% in the second quarter, to CA$23.2 million. A decline in sales volume for recreational flower and oil products was part of the reason; other factors included a decrease in the net selling price of cannabis products due to increasing competition. Also, management suggested that evolving consumer preferences might have taken a toll on the second-quarter sales numbers.
The company also saw a 145% increase in SG&A (selling, general and administrative) expenses and a 45% increase in the cost of sales in the second quarter, both of which help to explain the quarterly EBITDA loss of CA$1.1 million. OrganiGram said the increased spending went to marketing, promotion, and scaling its operations for the launch of cannabis 2.0 products.
Amid the dismal results, there was good news: Recreational cannabis showed a 16% increase from the first quarter to the second, demonstrating the increased demand for cannabis 2.0 recreational products. The company launched a few of its 2.0 products, including chocolates and vape pens, in December.
OrganiGram's cannabis 2.0 product portfolio
OrganiGram's cannabis 2.0 products are already a hit, making up 13% of net revenue in the second quarter. In December 2019, the company shipped its first batch of 2.0 offerings -- namely, the Trailblazer Spark, Flicker, and Glow 510-thread vape cartridges. On Feb. 20, it launched its Edison + Feather ready-to-go distillate pens. Additionally, the market could see the launch of Edison + PAX ERA distillate cartridges, OrganiGram's premium line of vape products, in the second quarter of calendar year 2020. And for consumers with a sweet tooth, OrganiGram also launched its line of premium cannabis-infused chocolates, Edison Bytes, in February.
What's driving OrganiGram's revenue is its focus on continuing to provide excellent products through innovation and testing. It conducts regular consumer research to understand people's preferences and offers a diversified portfolio of products.
OrganiGram's diverse product portfolio was on display in the second quarter:
Cannabis 1.0 products made up 52% of net revenue
Cannabis 2.0 products made up 13% of net revenue
Wholesale cannabis sales made up 24% of net revenue
Canadian medical sales made up 10% of net revenue
International cannabis sales made up 1% of net revenue
Recently, management announced a new line of recreational products -- including organic cannabis line ANKR Organics -- which it expects to launch in fiscal Q3 2020.
Capacity to survive the COVID-19 storm
In April 2020, OrganiGram made some temporary layoffs; 45% of its workforce departed, mostly voluntarily. Layoffs are never a good sign, but these were made to boost social-distancing efforts during COVID-19. The company faces a one-time charge of approximately CA$600,000 for the lump-sum payments made to the laid-off employees.
You would think that a 45% reduction in its workforce would affect a company's production capacity, especially now that demand is high amid the pandemic. But OrganiGram is well prepared with its inventories on hand -- it even has contingency staff to fulfill packaging capacity to meet the current appetite for cannabis.
I am impressed with management's strategy of focusing on more automated products now, delaying the production of those requiring manual labor to a later stage after the pandemic ends. For instance, OrganiGram says its Edison Bytes chocolate truffle can be produced with its automated production and packaging equipment. The company is also ensuring its production of medical cannabis continues in full swing to serve the patients who rely on its products.
Furthermore, OrganiGram ended the quarter with cash and short-term investments worth CA$41.2 million, up from the first quarter's $34.1 million -- showing it's capable of surviving any COVID-19 impact that could arise. I'm impressed with management's confidence in its current capital sources and its ability to manage its cash flows to meet the current demand. Compare this performance to that of peer Aurora Cannabis (NYSE: ACB), where the debt burden is rising and profits are elusive.
Long-term game
Currently, the broader market is weighing on the marijuana industry. However, the COVID-19 outbreak has somewhat been favorable for the industry as it sees rising cannabis demand and sales.
A growing, highly regulated industry such as cannabis requires time to show its full potential. And cannabis is yet to be fully legal in the U.S.; federal legalization will be highly beneficial if and when it occurs, allowing cannabis companies to expand.
This is an evolving industry with plenty of turmoil to go around. If you're an investor interested in marijuana who's seeking a stable, cash-rich investment in a bumpy space, OrganiGram looks like a good bet to help your money grow over the long term.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Sushree Mohanty has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends OrganiGram Holdings. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Who wants to look at the smaller cannabis companies when everyone is eyeing what the bigger players -- think Aurora Cannabis (NYSE: ACB) and Canopy Growth (NYSE: CGC) -- are up to? Compare this performance to that of peer Aurora Cannabis (NYSE: ACB), where the debt burden is rising and profits are elusive. However, OrganiGram's consistent revenue growth and management's confidence in the eventual profitability of its cannabis 2.0 product portfolio are what give me continued faith in the company. | Who wants to look at the smaller cannabis companies when everyone is eyeing what the bigger players -- think Aurora Cannabis (NYSE: ACB) and Canopy Growth (NYSE: CGC) -- are up to? Compare this performance to that of peer Aurora Cannabis (NYSE: ACB), where the debt burden is rising and profits are elusive. However, OrganiGram's consistent revenue growth and management's confidence in the eventual profitability of its cannabis 2.0 product portfolio are what give me continued faith in the company. | Who wants to look at the smaller cannabis companies when everyone is eyeing what the bigger players -- think Aurora Cannabis (NYSE: ACB) and Canopy Growth (NYSE: CGC) -- are up to? Compare this performance to that of peer Aurora Cannabis (NYSE: ACB), where the debt burden is rising and profits are elusive. However, OrganiGram's consistent revenue growth and management's confidence in the eventual profitability of its cannabis 2.0 product portfolio are what give me continued faith in the company. | Who wants to look at the smaller cannabis companies when everyone is eyeing what the bigger players -- think Aurora Cannabis (NYSE: ACB) and Canopy Growth (NYSE: CGC) -- are up to? Compare this performance to that of peer Aurora Cannabis (NYSE: ACB), where the debt burden is rising and profits are elusive. Amid the dismal results, there was good news: Recreational cannabis showed a 16% increase from the first quarter to the second, demonstrating the increased demand for cannabis 2.0 recreational products. |
37543.0 | 2020-04-29 00:00:00 UTC | Better Buy: OrganiGram Holdings vs. Canopy Growth | ACB | https://www.nasdaq.com/articles/better-buy%3A-organigram-holdings-vs.-canopy-growth-2020-04-29 | nan | nan | Comparing Canopy Growth (NYSE: CGC) against OrganiGram Holdings (NASDAQ: OGI) is a bit of a David vs. Goliath match-up. The former is the industry leader. The latter is still a fairly small player by comparison, as its revenue over the past 12 months would fall well short of what its counterpart generated in just its most recent quarter. OrganiGram's market cap is about $280 million U.S., meaning Canopy Growth is more than 20 times its size. However, one can argue that the smaller company may have much more growth potential left. Let's take a look to see if that's the case, and if OrganiGram could be an underrated buy.
Is OrganiGram generating enough growth?
The name of the game in the cannabis industry is growth, and that's one area where OrganiGram hasn't been doing so well lately. The company is coming off a brutal second-quarter performance where it didn't generate any growth and its losses only got bigger.
The company did see a quarter-over-quarter increase of 2.96 million Canadian dollars in its adult-use sales, a 19% improvement from the first quarter. But wholesale sales to licensed producers more than offset that, falling by CA$3.65 million, a 40% drop from the company's Q1 results.
Image source: Getty Images.
Prior to Q1, growth was a lot easier to accomplish for OrganiGram and other Canadian cannabis producers because the prior-year numbers were from periods when the recreational market wasn't yet legal (the Canadian government officially legalized marijuana on Oct. 17, 2018). Now, with a more mature market and more competitors in the industry, generating revenue growth is only going to get more challenging. Cannabis giant Aurora Cannabis (NYSE: ACB) has scaled back its expectations so much that it is forecasting only "modest to no growth" for its upcoming quarter. A forecast like that would have been unheard of in the industry just a year ago.
Aurora's stock is down more than 90% in the past year, and concerns about growth aren't going to make it any more investable today. The Horizons Marijuana Life Sciences Index ETF (OTC: HMLSF) is down 72% during the same period, while Canopy Growth is a couple of percentage points better than that.
Canopy's diverse business makes growth a lot easier
While the cannabis industry is struggling, Canopy Growth is proving again why it's still one of the best pot stocks to buy: diversification.
When the company released its third-quarter results back in February, its sales numbers were up by 49% from the prior-year period. However, this is a little misleading -- it hasn't been smooth sailing for Canopy Growth, either. The company's business-to-business recreational revenue declined by 11% from a year ago, from CA$60.1 million to CA$53.5 million. Its smaller business-to-consumer segment saw stronger revenue growth from CA$11.5 million to CA$15.2 million, an increase of 33%.
What made the difference for the company was its other segments. International sales of CA$18.7 million were nearly seven times the CA$2.7 million that the company reported in the prior-year quarter. Other revenue of CA$33.4 million was also more than four times last year's tally of CA$7.5 million. The growth in the other revenue segment largely came from the company's vaporizer brand, Storz & Bickel.
Which stock should you buy?
There's really only one main reason to consider OrganiGram over Canopy Growth, and that's valuation. At about 19 times its sales, Canopy Growth is not a cheap buy -- although that's down from its year-ago level of more than 60 times sales. By comparison, OrganiGram trades at a more modest 4 times its revenue over the past 12 months.
However, none of that means as much at a time when just surviving the coronavirus pandemic will be an accomplishment, and that's where OrganiGram has a big disadvantage. The company has a modest CA$41 million in cash and cash equivalents on its books as of Feb. 29. That's also how much cash it's used up in its operating activities over the past three quarters. There's not a whole lot of buffer there, and it could lead to trouble for OrganiGram down the road. The company's already laid off 45% of its staff, and deeper cuts could be on the way the longer the pandemic lasts.
Canopy Growth also laid off 500 of its workers this year, but it's still in a much better place. At the end of 2019, the company had CA$1.6 billion in cash and cash equivalents. Over a similar nine-month period to OrganiGram, the company burned through CA$548 million, or about one-third of the cash it has on hand today. Canopy Growth looks to be in a solid position to handle any cash challenges that may come its way over the next year. And that's without factoring in the fact that, unlike OrganiGram, the top cannabis stock also has a key partner in Constellation Brands (NYSE: STZ) that can help it navigate this challenging year.
With better growth, more diversification, and much more cash at its disposal, there's little doubt that Canopy Growth is the better long-term buy today.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
David Jagielski has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Constellation Brands and OrganiGram Holdings. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Cannabis giant Aurora Cannabis (NYSE: ACB) has scaled back its expectations so much that it is forecasting only "modest to no growth" for its upcoming quarter. Comparing Canopy Growth (NYSE: CGC) against OrganiGram Holdings (NASDAQ: OGI) is a bit of a David vs. Goliath match-up. The Horizons Marijuana Life Sciences Index ETF (OTC: HMLSF) is down 72% during the same period, while Canopy Growth is a couple of percentage points better than that. | Cannabis giant Aurora Cannabis (NYSE: ACB) has scaled back its expectations so much that it is forecasting only "modest to no growth" for its upcoming quarter. Prior to Q1, growth was a lot easier to accomplish for OrganiGram and other Canadian cannabis producers because the prior-year numbers were from periods when the recreational market wasn't yet legal (the Canadian government officially legalized marijuana on Oct. 17, 2018). Canopy's diverse business makes growth a lot easier While the cannabis industry is struggling, Canopy Growth is proving again why it's still one of the best pot stocks to buy: diversification. | Cannabis giant Aurora Cannabis (NYSE: ACB) has scaled back its expectations so much that it is forecasting only "modest to no growth" for its upcoming quarter. Prior to Q1, growth was a lot easier to accomplish for OrganiGram and other Canadian cannabis producers because the prior-year numbers were from periods when the recreational market wasn't yet legal (the Canadian government officially legalized marijuana on Oct. 17, 2018). Canopy's diverse business makes growth a lot easier While the cannabis industry is struggling, Canopy Growth is proving again why it's still one of the best pot stocks to buy: diversification. | Cannabis giant Aurora Cannabis (NYSE: ACB) has scaled back its expectations so much that it is forecasting only "modest to no growth" for its upcoming quarter. Canopy's diverse business makes growth a lot easier While the cannabis industry is struggling, Canopy Growth is proving again why it's still one of the best pot stocks to buy: diversification. Its smaller business-to-consumer segment saw stronger revenue growth from CA$11.5 million to CA$15.2 million, an increase of 33%. |
37544.0 | 2020-04-29 00:00:00 UTC | Why You Should Avoid Aurora Stock Before It Splits | ACB | https://www.nasdaq.com/articles/why-you-should-avoid-aurora-stock-before-it-splits-2020-04-29 | nan | nan | InvestorPlace - Stock Market News, Stock Advice & Trading Tips
Marijuana stocks like Aurora Cannabis (NYSE:ACB) already were having a terrible year. And then the novel coronavirus hit, pushing things from bad to worse for Aurora stock.
Source: Shutterstock
In theory, it shouldn’t have been all bad news. Tobacco and alcohol sales, for example, have been up substantially at both grocery stores and liquor shops. Many states have even declared alcohol to be an essential service, allowing beer and wine stores to remain open.
But marijuana companies are struggling, and Aurora stock continued to fall to multi-year lows.
There’s a simple reason that explains the difference. Tobacco and alcohol are established industries with powerful brands and established buying patterns. Cannabis, by contrast, is an up-and-coming industry. Firms like Aurora are still trying to develop the first-mover advantage. This was the pivotal moment in getting their brands to the top of consumers’ minds and creating durable and profitable distribution channels.
10 Stocks That Every 30-Year-Old Should Buy and Hold Forever
With the coronavirus, many stores are closed or doing much less business. Additionally, permitting and legal processes for new marijuana markets and outlets have ground to a halt. Companies like ACB are losing significant sums of money now, with the intention of making it back later as cannabis matures into a robust market.
But 2020 is shaping up to be a lost year on that front, and it’s put Aurora in a bit of a financial bind. As a result, shareholders are likely to face more setbacks in coming months.
A Reverse Split is Coming for Aurora Stock
In its recent business transformation plan that it laid out with shareholders, Aurora mentioned that it will be engaging in a reverse split next month. On or around May 11, every current 12 shares of Aurora stock will turn into 1 new share of Aurora Cannabis.
If you own 600 shares now, for example, it would turn into 50 new shares. Meanwhile the share price should go up around 12 times as well after the split. So that theoretical 600 share investment would still be worth $450. However, now it will be in the form of 50 shares at $9 each, instead of 600 shares worth 75 cents a pop.
The company is doing this to avoid delisting. If a firm’s stock remains below $1 per share for an extended period, it can be removed from the stock exchange. The reverse split will avoid that, getting the stock price back up to a much higher level.
Drawbacks to the Split
It’s great that Aurora will retain its U.S. stock market listing; that’s a key trait for keeping a solid shareholder base and raising capital. But there are also downsides.
For one thing, share prices usually tend to go down during the reverse split process. On the one hand, many traders stop buying a stock after the reverse split. A $1 stock might seem to have more upside than a $10 stock; in any case, people are attracted to cheap stocks.
Another issue is that it will trigger more short selling. Many brokers make it difficult or impossible to short sell companies trading below $5 or $2.50 per share. Aurora, back up at $9, will be easy to bet against again.
In addition to that, the company announced that it intends to sell more new shares to the public via a new at-the-market “ATM” offering. This will result in both the company itself and short sellers likely causing downward pressure on the stock price over the next month.
Still A Chance At Recovery
When you look at a 75-cent stock doing a reverse split, you might assume the company is in grave trouble. While Aurora’s short-term prospects are indeed cloudy, the company still has a shot.
ACB still has a market cap approaching $1 billion. Business expanded markedly in recent quarters, and the company confirmed that revenues should continue growing in the back half of 2020 despite the virus.
Going forward, there should be many markets coming online, both as individual U.S. states legalize, and more countries follow suit overseas. While Aurora has had to pare back some of its operations to cut costs, it still has one of the broadest footprints of the marijuana companies, and is set to benefit as the industry gains more adoption around the globe.
And, as of last quarter, the company had substantial cash balances, with nearly 20% of its market capitalization consisting of cash. Throw in proceeds from the ATM sales, and Aurora will be in this for the long haul.
The marijuana market obviously needs to cooperate, but when things turn back up for the industry, Aurora could be a winner.
The Bottom Line on ACB
There’s certainly still an investment case for Aurora Cannabis. The company is down, but it’s not out of the picture. In fact, there are still many positive catalysts that could swing the momentum back in favor of the cannabis companies within the next year.
If you do want to buy the stock, however, there’s no reason to rush. The upcoming reverse split could cause a major decline in Aurora’s stock over the next month. With that set to go into effect on May 11, you should consider waiting until mid-May to make any purchases. For the next few weeks, the trend is likely to continue lower.
Ian Bezek has written more than 1,000 articles for InvestorPlace.com and Seeking Alpha. He also worked as a Junior Analyst for Kerrisdale Capital, a $300 million New York City-based hedge fund. You can reach him on Twitter at @irbezek. At the time of this writing, he held no positions in any of the aforementioned securities.
The post Why You Should Avoid Aurora Stock Before It Splits appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips Marijuana stocks like Aurora Cannabis (NYSE:ACB) already were having a terrible year. Companies like ACB are losing significant sums of money now, with the intention of making it back later as cannabis matures into a robust market. ACB still has a market cap approaching $1 billion. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips Marijuana stocks like Aurora Cannabis (NYSE:ACB) already were having a terrible year. Companies like ACB are losing significant sums of money now, with the intention of making it back later as cannabis matures into a robust market. ACB still has a market cap approaching $1 billion. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips Marijuana stocks like Aurora Cannabis (NYSE:ACB) already were having a terrible year. Companies like ACB are losing significant sums of money now, with the intention of making it back later as cannabis matures into a robust market. ACB still has a market cap approaching $1 billion. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips Marijuana stocks like Aurora Cannabis (NYSE:ACB) already were having a terrible year. Companies like ACB are losing significant sums of money now, with the intention of making it back later as cannabis matures into a robust market. ACB still has a market cap approaching $1 billion. |
37545.0 | 2020-04-29 00:00:00 UTC | 3 Pot Stocks That Aren't as Cheap as They Appear | ACB | https://www.nasdaq.com/articles/3-pot-stocks-that-arent-as-cheap-as-they-appear-2020-04-29 | nan | nan | Throughout much of 2017, most of 2018, and the first quarter of 2019, marijuana stocks were virtually unstoppable. Promises of top-tier production, partnerships, and high-margin derivative products sent pot stocks into the stratosphere.
But over the past 13 months, cannabis stocks have cratered, with some losing as much as 95% of their value. This shakeout was inevitable as history has shown us that not every company can be a winner when the next big investment trend arises.
However, such significant declines in marijuana stock market caps have some investors wondering if now is the time to take advantage of perceived-to-be "cheap" valuations. After all, Wall Street is still counting on cannabis to be at least a $50 billion industry by 2030. But as you're about to see, a low share price doesn't mean a stock is cheap. Here are three pot stocks that appear cheap, but aren't remotely good values.
Image source: Getty Images.
Aurora Cannabis
In terms of popularity, Aurora Cannabis (NYSE: ACB) is king among pot stocks. On millennial-focused investment app Robinhood, Aurora is the most-held stock by a mile. We're talking about a company that, as of the midpoint of 2019, was on track to lead all of Canada in peak annual production, had somewhat recently hired activist investor Nelson Peltz as a strategic advisor, and appeared set to land numerous wholesale supply agreements given its exposure to 24 countries outside Canada.
At Aurora Cannabis' closing price on Monday, April 27, of $0.76 per share, it probably sounds like a steal of a deal -- but it's not.
You see, even with its share price at just $0.76, Aurora still sports a market cap of nearly $1 billion. That's because, over a span of almost six years, the company has grown its outstanding share count from 16 million to 1.31 billion! Aurora has been selling its common stock to raise cash for years, and has used its common stock as collateral for its more than one dozen acquisitions since August 2016. With the company facing a potential cash crunch in calendar year 2020, another $350 million at-the-market share offering was recently approved by its board.
Aurora Cannabis is also likely facing a trio of writedowns. Even following a goodwill impairment of $762 million Canadian in the fiscal second quarter, Aurora's goodwill still totals CA$2.41 billion and accounts for 52% of total assets. Beyond just expecting a goodwill writedown, this is a company with ballooning inventory levels and idled or underutilized assets. As a reminder, Aurora Cannabis halted construction on two projects last year, while announcing its intent to sell a 1-million-square-foot greenhouse earlier this year.
To put it bluntly, Aurora Cannabis is a dumpster fire, and a $1 billion valuation is hardly justifiable.
Image source: Getty Images.
HEXO
Another perceived-to-be cheap cannabis stock is Quebec-based HEXO (NYSE: HEXO). As of this time last year, HEXO looked set to capitalize on a five-year, 200,000-kilo wholesale supply agreement with its home province, as well as utilize space at its flagship Gatineau facility for the processing and manufacturing of high-margin derivatives. These high-margin products, such as edibles and infused beverages, wound up hitting dispensary shelves in Canada in mid-December.
Yet, as of earlier this week, HEXO's share price of $0.535 makes it look like an absolute deal compared to the $8-plus is traded at in late April 2019. But looks can be deceiving.
For example, even though HEXO's stock has fallen by more than 90% over the past year, it still sports a market cap of around $185 million. The reason its market cap remains so high is because HEXO, like Aurora, is selling its common stock (or convertible debentures) to raise cash. After ending January 2019 with close to 208 million outstanding shares, the company now has closer to 344 million shares. Considering that HEXO has sold stock at significant discounts to its previous day's closing price on more than one occasion, it's become evident to Wall Street that the company is pretty desperate for cash.
We're also talking about a company that's gone on the defensive to reduce its expenditures. HEXO has no plans to reopen the idled Niagara grow farm that was acquired via the Newstrike Brands acquisition, and it's also idling about 200,000 square feet of cultivation space at Gatineau. My guess is this reduces its peak annual output from 150,000 kilos to potentially under 100,000 kilos. In addition, HEXO laid off 200 employees last year.
Lastly, HEXO's share price makes it a target for delisting from the New York Stock Exchange. It may have to follow Aurora's footsteps and enact a reverse split. Most companies that are pressured into a reverse split to avoid delisting from a major exchange will see their valuations fall even more.
Image source: Getty Images.
Cronos Group
Chances are that pot stock investors are probably eyeing Cronos Group (NASDAQ: CRON) as well following its tumble from almost $17 a year ago to just $6.44 as of Monday. As a reminder, Cronos Group ended 2019 with around $1.5 billion in cash, cash equivalents, and marketable securities on its balance sheet, which is almost entirely from tobacco giant Altria Group (NYSE: MO) taking an equity investment in the company in mid-March 2019.
While the idea of a large cash buffer and Altria as a partner sounds great on paper, there's more to this valuation than meets the eye.
Stripping out the cash value, investors are paying around $730 million for Cronos Group at the moment. This is a company that, in 2019, only managed $23.8 million in net sales and produced a gross loss of $17.9 million. Cronos Group has consistently trailed its Canadian peers in the production department, and the company currently only has Peace Naturals to lean on as a steady production source. However, the 40,000-kilo annual peak capacity of Peace Naturals is hardly worth writing home about for shareholders.
Cronos Group's game-changing partnership with Altria also hasn't been anything to get too excited about. Aside from Altria shoring up Cronos' balance sheet, the duo have failed to find their stride. A vape-health scare in the U.S. last year, followed by coronavirus disease 2019 (COVID-19) supply disruptions in 2020, have significantly dampened the near-term outlook for the cannabis vape market.
Cronos Group is no closer to profitability now than it was a year ago. Its cash hoard should help provide more of a downside buffer than with most pot stocks, but $730 million is a ridiculous valuation (excluding cash) to bestow on a business that's been outperformed in the production department by licensed growers a fifth of its size. Cronos Group is not the value it appears.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Sean Williams has no position in any of the stocks mentioned. The Motley Fool recommends HEXO. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Aurora Cannabis In terms of popularity, Aurora Cannabis (NYSE: ACB) is king among pot stocks. As of this time last year, HEXO looked set to capitalize on a five-year, 200,000-kilo wholesale supply agreement with its home province, as well as utilize space at its flagship Gatineau facility for the processing and manufacturing of high-margin derivatives. Considering that HEXO has sold stock at significant discounts to its previous day's closing price on more than one occasion, it's become evident to Wall Street that the company is pretty desperate for cash. | Aurora Cannabis In terms of popularity, Aurora Cannabis (NYSE: ACB) is king among pot stocks. Promises of top-tier production, partnerships, and high-margin derivative products sent pot stocks into the stratosphere. Cronos Group Chances are that pot stock investors are probably eyeing Cronos Group (NASDAQ: CRON) as well following its tumble from almost $17 a year ago to just $6.44 as of Monday. | Aurora Cannabis In terms of popularity, Aurora Cannabis (NYSE: ACB) is king among pot stocks. Aurora has been selling its common stock to raise cash for years, and has used its common stock as collateral for its more than one dozen acquisitions since August 2016. Cronos Group Chances are that pot stock investors are probably eyeing Cronos Group (NASDAQ: CRON) as well following its tumble from almost $17 a year ago to just $6.44 as of Monday. | Aurora Cannabis In terms of popularity, Aurora Cannabis (NYSE: ACB) is king among pot stocks. However, such significant declines in marijuana stock market caps have some investors wondering if now is the time to take advantage of perceived-to-be "cheap" valuations. At Aurora Cannabis' closing price on Monday, April 27, of $0.76 per share, it probably sounds like a steal of a deal -- but it's not. |
37546.0 | 2020-04-29 00:00:00 UTC | Canopy Growth Stock has Upside Potential Emerging From This Covid-19 Hole | ACB | https://www.nasdaq.com/articles/canopy-growth-stock-has-upside-potential-emerging-from-this-covid-19-hole-2020-04-29 | nan | nan | InvestorPlace - Stock Market News, Stock Advice & Trading Tips
I decided late last week that I wanted to share this positive upside note on Canopy Growth (NYSE:CGC) stock. But doing it after Monday’s 12% spike — and with little of that lost on Tuesday — makes it difficult because I dislike chasing runaway rallies. Regardless, CGC stock is showing life and remains my pick of the cannabis stocks that are still in the running.
Source: Jarretera / Shutterstock.com
Gone are the wild days of blindly chasing the pot stock tickers. Today’s investors — like today’s pot consumers — are more discerning. Once-hot stock Aurora Cannabis (NYSE:ACB) for example is now under a buck. But the upside of that deflation of exuberance is that now the valuations are saner than ever. CGC for example now sells at only 25 times its sales and I say this with a serious tone. Cronos (NASDAQ:CRON) now has a positive price-to-earnings ratio. During the boom days of 2017 these metrics were out of whack. Furthermore, CGC still arguably has the best balance sheet of the bunch.
Management still needs to earn the respect it wants to command on Wall Street. Investors are willing to give it room but they won’t wait for ever. Gone are the days of having vague path to prosperity. Those died within the last year after Uber (NYSE:UBER) pricked that unicorn bubble. When times are tough, like they are now, investors won’t put up with hot air promises.
CGC Stock: From Single-Digit Hell to December Lows
Click to Enlarge
Source: Charts by TradingView
30 Consumer Stocks to Buy Once the Coronavirus Pandemic Passes
When the stock market crashed on novel coronavirus fears, Canopy stock fell to $9 per share. This is an important pivot because it was the breakout of 2017 that led to a 580% rally and the highs of October 2018. Since then, CGC stock has been setting lower highs and now is bumping along this level trying to find footing. If the bulls can manage this feat, then they breakout from this hellish descending wedge and target tremendous upside potential, maybe even a $10 rally or more. Arguably, this has already started as on Monday but there is plenty of resistance ahead to go through.
There will be a lot of hard work especially around $19 and $22.50 per share. There will be no free lunches and onus is on management to provide the fuel to pour onto this potential fire. Helping the cause is the fact that CGC stock spent the better part of April consolidating in a tight range. Yesterday’s pop is the first breach of it and should have a little more in it. Then it would be normal for it to fade a little so that they can finish the pattern towards $20.
Once a stock breaks out from a neckline, it’s normal to turn back lower to test it for footing. That’s how bulls build strength on top of prior tough spots. You’ve heard it said as “prior resistance becomes forward support.” This is the case here off Monday’s breakout. In early March I wrote cautioning of potential pitfalls from almost exactly this point. Unfortunately for the fans of CGC, the price action proved me too right. The situation now is the opposite of that scenario.
Fundamentals Still Make Sense
For a long while we’ve been covering the trading opportunities of this stock. But eventually, investors need to set aside the technical aspects and bet on the long-term fundamental thesis for Canopy Growth and it is still needs to be viable. There’s still as vast an array of interests as last few years only with less fanaticism. This is good because this brings better conviction investors to stabilize the stock actions.
7 Beautiful Biotech Stocks to Buy Here
Long term, most mainstream companies will eventually have cannabis or its byproducts as part of their line up. This includes edibles, drinkables, topical applications, medicinals and more. There was a deflation in the mania but that doesn’t mean it’s gone. It is impossible to sway those who believe in the stuff, so they will remain committed. And “if you build it” and put it on the grocery shelves, new users will come to check it out … pun intended.
The Covid-19 crisis put a crimp on all stocks and CGC did not escape the carnage. But like most of the markets, it managed to dig itself out of the abyss and onto a platform of sorts. From here the buyers have the chance to build even more upside momentum so it can start recovering some of the lost glory at least of 2019.
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 for free here.
The post Canopy Growth Stock has Upside Potential Emerging From This Covid-19 Hole appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Once-hot stock Aurora Cannabis (NYSE:ACB) for example is now under a buck. If the bulls can manage this feat, then they breakout from this hellish descending wedge and target tremendous upside potential, maybe even a $10 rally or more. But eventually, investors need to set aside the technical aspects and bet on the long-term fundamental thesis for Canopy Growth and it is still needs to be viable. | Once-hot stock Aurora Cannabis (NYSE:ACB) for example is now under a buck. InvestorPlace - Stock Market News, Stock Advice & Trading Tips I decided late last week that I wanted to share this positive upside note on Canopy Growth (NYSE:CGC) stock. Since then, CGC stock has been setting lower highs and now is bumping along this level trying to find footing. | Once-hot stock Aurora Cannabis (NYSE:ACB) for example is now under a buck. InvestorPlace - Stock Market News, Stock Advice & Trading Tips I decided late last week that I wanted to share this positive upside note on Canopy Growth (NYSE:CGC) stock. Regardless, CGC stock is showing life and remains my pick of the cannabis stocks that are still in the running. | Once-hot stock Aurora Cannabis (NYSE:ACB) for example is now under a buck. Regardless, CGC stock is showing life and remains my pick of the cannabis stocks that are still in the running. Source: Jarretera / Shutterstock.com Gone are the wild days of blindly chasing the pot stock tickers. |
37547.0 | 2020-04-28 00:00:00 UTC | 21.2 Million Reasons Aurora Cannabis Is a Terrible Stock | ACB | https://www.nasdaq.com/articles/21.2-million-reasons-aurora-cannabis-is-a-terrible-stock-2020-04-28 | nan | nan | If you thought the stock market has been taken on a wild ride over the past two months, then take a closer look at how marijuana stocks have fared since the beginning of April 2019. Following the first quarter of 2019, which saw numerous pot stocks rocket into the stratosphere, the past 13 months have erased anywhere from 50% to 95% of cannabis stock valuations.
Mind you, the long-term outlook for the legal weed industry is promising. Tens of billions of dollars in sales are conducted in the black market each year, meaning there's a very real opportunity to move these illicit users to legal channels over time. But in the short run, U.S. pot stocks have been crushed by high tax rates, while Canadian cannabis companies have run into supply bottlenecks and shortages, depending on the province.
Image source: Getty Images.
Aurora Cannabis has dashed investors' "high" expectations
Perhaps no pot stock has stood out more for all the wrong reasons than Aurora Cannabis (NYSE: ACB). Aurora Cannabis has been the most-held stock on millennial-focused investing app Robinhood for months, yet is down close to 92% since mid-March 2019. For new investors getting their first taste of what buy-and-hold investing is like, Aurora has set a poor example.
At one time, this was a company that looked to be on track to lead Canada is peak annual output, and it was a projected leader in international expansion. The company's 15 production sites, if fully built out and operational, were expected to generate north of 660,000 kilos per year, with Aurora having a production, export, or research presence in 24 additional countries, beyond Canada. In short, it was expected to be a low-cost production giant that countries would line up to sign wholesale supply agreements with.
Aurora Cannabis was also expected to land a brand-name partner and/or equity investor following the hiring of billionaire activist investor Nelson Peltz as a strategic advisor. Peltz's background leans heavily toward consumer-packaged goods companies in the food and beverage industries, which would make him the perfect liaison to forge a partnership or equity investment between a brand-name business and Aurora Cannabis.
Unfortunately, none of these pie-in-the-sky expectations has even come close to hitting the mark. In fact, every couple of weeks it seems Aurora Cannabis gives investors another reason to sell and not look back. This week I've got a brand-new reason... or should I say almost 21.2 million of them... why Aurora is a terrible stock.
Image source: Getty Images.
Another 21.2 million reasons you should avoid Aurora Cannabis like the plague
Over the trailing five-month period, Aurora Cannabis' share price has lost 71% of its value and consistently fallen below $1 on the New York Stock Exchange (NYSE). Aurora is enacting a 1-for-12 reverse split in the coming weeks to regain compliance with the NYSE to avoid delisting. All the while, Aurora's press releases have suggested that, while the near-term remains challenging, the company remains on track to execute over the long run.
But you know what's missing over those past five months? Management putting their money where their mouth is and aligning their interests with that of their shareholders. With the exception of former CEO Terry Booth acquiring 73,500 shares between $2.06 and $2.09 in early January, there hasn't been any insider buying at Aurora Cannabis.
On the other side of the coin, there's been abundant selling. Following Booth's departure as CEO, he sold nearly 12.2 million shares of his holdings in mid-March, ranging between an average price of $0.66 and $0.91 per share. A little over a week later, Aurora's President Steve Dobler wound up selling 8 million shares of stock between $0.70 and $0.72. Also, back in mid-December, independent director Jason Dyck sold nearly 1.1 million shares of Aurora stock at $2.35. Altogether, that's around 21.2 million shares of Aurora stock sold by company insiders and 73,500 shares acquired as Aurora's share price shrunk another 71%.
Although there are a number of reasons insiders might choose to sell stock, including to cover their income-tax liability, such overwhelming selling in the face of unprecedented share price weakness doesn't exactly inspire hope in management's message that the company remains on track.
Image source: Getty Images.
Aurora Cannabis' balance sheet is a house or horrors
If this isn't enough to scare you away from investing in Aurora Cannabis, just take a deeper dive into the company's balance sheet and I'm sure you'll be convinced. From top to bottom, it's a house of horrors.
First off, we see a company that's lacking enough capital to meet its upcoming obligations. When filing its management discussion and analysis in mid-February for the fiscal second quarter ended Dec. 31, 2019, it was estimated that liabilities over the coming 12 months would total almost $374 million Canadian. But as of a recent press release, Aurora Cannabis had just CA$205 million in cash and cash equivalents on its balance sheet.
In order to raise additional cash, the company's only recourse has been to issue common stock. Having recently completed a $400 million (that's in U.S.) at-the-market (ATM) stock offering, the company announced plans to initiate a $350 million ATM offering moving forward. Or, to summarize, Aurora has ballooned its share count from 16 million to 1.31 billion in less than six years, and its management team now has the go-ahead to continue diluting existing shareholders by issuing up to 479 million more shares of stock (based on a close of $0.73).
This is also a company that's weighed down immensely by goodwill -- i.e., premium paid for acquisitions above and beyond tangible assets. Even after writing down CA$762.2 million in goodwill in the fiscal second quarter, Aurora Cannabis is still lugging around CA$2.41 billion in goodwill on its balance sheet. That's practically double its current market cap, and it represents 52% of total assets. With the company having virtually no shot to recoup this premium in the future, I view another large writedown as highly likely.
To sum things up, there aren't any good reasons for investors to gamble on Aurora Cannabis.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Sean Williams has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Aurora Cannabis has dashed investors' "high" expectations Perhaps no pot stock has stood out more for all the wrong reasons than Aurora Cannabis (NYSE: ACB). Tens of billions of dollars in sales are conducted in the black market each year, meaning there's a very real opportunity to move these illicit users to legal channels over time. Peltz's background leans heavily toward consumer-packaged goods companies in the food and beverage industries, which would make him the perfect liaison to forge a partnership or equity investment between a brand-name business and Aurora Cannabis. | Aurora Cannabis has dashed investors' "high" expectations Perhaps no pot stock has stood out more for all the wrong reasons than Aurora Cannabis (NYSE: ACB). Altogether, that's around 21.2 million shares of Aurora stock sold by company insiders and 73,500 shares acquired as Aurora's share price shrunk another 71%. But as of a recent press release, Aurora Cannabis had just CA$205 million in cash and cash equivalents on its balance sheet. | Aurora Cannabis has dashed investors' "high" expectations Perhaps no pot stock has stood out more for all the wrong reasons than Aurora Cannabis (NYSE: ACB). Another 21.2 million reasons you should avoid Aurora Cannabis like the plague Over the trailing five-month period, Aurora Cannabis' share price has lost 71% of its value and consistently fallen below $1 on the New York Stock Exchange (NYSE). Altogether, that's around 21.2 million shares of Aurora stock sold by company insiders and 73,500 shares acquired as Aurora's share price shrunk another 71%. | Aurora Cannabis has dashed investors' "high" expectations Perhaps no pot stock has stood out more for all the wrong reasons than Aurora Cannabis (NYSE: ACB). In fact, every couple of weeks it seems Aurora Cannabis gives investors another reason to sell and not look back. To sum things up, there aren't any good reasons for investors to gamble on Aurora Cannabis. |
37548.0 | 2020-04-27 00:00:00 UTC | CANADA STOCKS-TSX rises on global stimulus measures, lockdown easing | ACB | https://www.nasdaq.com/articles/canada-stocks-tsx-rises-on-global-stimulus-measures-lockdown-easing-2020-04-27 | nan | nan | April 27 (Reuters) - Canada's main stock index rose in volatile trading on Monday as global economic stimulus measures and news of some countries easing lockdowns pulled investors back to riskier assets.
A central bank-focused week began with the Bank of Japan expanding monetary stimulus and pledging to buy an unlimited amount of bonds, while the U.S. Federal Reserve and the European Central Bank meet later in the week, with the latter likely to do more bond buying. MKTS/GLOB
Optimism also stemmed from Canada's slowing death toll from the coronavirus. Amid plans to restart economies of Canadian provinces, Prime Minister Justin Trudeau said isolation measures to fight the outbreak should remain for the time being.
* At 09:53 a.m. ET (13:53 GMT), the Toronto Stock Exchange's S&P/TSX composite index .GSPTSE was up 59.51 points, or 0.41%, at 14,479.87, after a week of modest gains.
* But capping gains was the energy sector .SPTTEN, down 3.1%, as U.S. crude CLc1 prices fell 27.1% a barrel, while Brent crude LCOc1 lost 8.3%. O/R
* Seven Generations Energy Ltd VII.TO fell 7.5%, the most on the TSX, while the second biggest decliner was Baytex Energy Co BTE.TO, down 6.9%.
* The financials sector .SPTTFS gained 0.8%, while the industrials sector .GSPTTIN rose 1.1%.
* The materials sector .GSPTTMT, which includes precious and base metals miners and fertilizer companies, lost 0.9% as gold futures GCc1 fell 0.2% to $1,719.8 an ounce. GOL/MET/L
* On the TSX, 150 issues were higher, while 78 issues declined for a 1.92-to-1 ratio favouring gainers, with 39.26 million shares traded.
* The largest percentage gainers on the TSX were MAG Silver Corp MAG.TO, which jumped 13.5%, and Canopy Growth Co WEED.TO, which rose 8.1%.
* The most heavily traded shares by volume were Guyana Goldfields GUY.TO and Aurora Cannabis ACB.TO.
* The TSX posted 7 new 52-week highs and no new lows.
* Across all Canadian issues there were 14 new 52-week highs and 3 new lows, with total volume of 72.10 million shares.
(Reporting by Susan Mathew in Bengaluru; Editing by Shailesh Kuber)
((susan.mathew@thomsonreuters.com; +91-80-6287-2704;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | * The most heavily traded shares by volume were Guyana Goldfields GUY.TO and Aurora Cannabis ACB.TO. April 27 (Reuters) - Canada's main stock index rose in volatile trading on Monday as global economic stimulus measures and news of some countries easing lockdowns pulled investors back to riskier assets. Amid plans to restart economies of Canadian provinces, Prime Minister Justin Trudeau said isolation measures to fight the outbreak should remain for the time being. | * The most heavily traded shares by volume were Guyana Goldfields GUY.TO and Aurora Cannabis ACB.TO. April 27 (Reuters) - Canada's main stock index rose in volatile trading on Monday as global economic stimulus measures and news of some countries easing lockdowns pulled investors back to riskier assets. GOL/MET/L * On the TSX, 150 issues were higher, while 78 issues declined for a 1.92-to-1 ratio favouring gainers, with 39.26 million shares traded. | * The most heavily traded shares by volume were Guyana Goldfields GUY.TO and Aurora Cannabis ACB.TO. April 27 (Reuters) - Canada's main stock index rose in volatile trading on Monday as global economic stimulus measures and news of some countries easing lockdowns pulled investors back to riskier assets. A central bank-focused week began with the Bank of Japan expanding monetary stimulus and pledging to buy an unlimited amount of bonds, while the U.S. Federal Reserve and the European Central Bank meet later in the week, with the latter likely to do more bond buying. | * The most heavily traded shares by volume were Guyana Goldfields GUY.TO and Aurora Cannabis ACB.TO. * But capping gains was the energy sector .SPTTEN, down 3.1%, as U.S. crude CLc1 prices fell 27.1% a barrel, while Brent crude LCOc1 lost 8.3%. GOL/MET/L * On the TSX, 150 issues were higher, while 78 issues declined for a 1.92-to-1 ratio favouring gainers, with 39.26 million shares traded. |
37549.0 | 2020-04-26 00:00:00 UTC | Despite Controversy, This Marijuana Stock Winner Just Keeps on Growing | ACB | https://www.nasdaq.com/articles/despite-controversy-this-marijuana-stock-winner-just-keeps-on-growing-2020-04-26 | nan | nan | Investors continue to believe in the long-term prospects of the cannabis industry, but it's been tough to endure the past couple of years. Most of the best-known cultivation stocks, such as Canopy Growth (NYSE: CGC) and Aurora Cannabis (NYSE: ACB), have seen their shares drop significantly since early 2018. Along with peers Tilray (NASDAQ: TLRY) and Cronos Group (NASDAQ: CRON), these companies haven't cashed in as quickly on new opportunities for growth as most shareholders had hoped, and that's been the primary reason for the big declines they've posted.
Yet there's one stock in the cannabis industry that's posted solid positive returns over the past two years. Innovative Industrial Properties (NYSE: IIPR) continued to profit from its real-estate-minded approach to the marijuana market, and despite attacks from skeptical investing analysts, Innovative Industrial hasn't slowed down in its pursuit of promising properties for its cannabis partners.
Image source: Getty Images.
The basics of Innovative Industrial Properties
Innovative Industrial Properties has a business model that's far different from the big-name marijuana growers above. Rather than engaging in cultivation itself, Innovative Industrial tries to find suitable real estate for growing companies. Set up as a real estate investment trust, Innovative Industrial has extensive knowledge of the rules and regulations that growers need to follow in order to establish medical marijuana growing facilities in states across the U.S., and that gives it a competitive advantage over more generalized real estate specialists.
The result has been a huge first-mover advantage for the company that has resulted in dramatic growth. In addition, because it's a REIT, Innovative Industrial pays out the majority of its income to its shareholders in dividend distributions. That payout has grown from $0.15 per share quarterly as recently as late 2017 to $1 per share in its most recent dividend.
How Innovative Industrial hopes to fuel higher future dividends
Innovative Industrial has been able to give dividend investors what they want to see by continually looking for good prospects in the real estate market. Its success in doing so has let it expand its portfolio at a reasonable pace and put it in position to keep growing its funds from operations.
In just the past month alone, Innovative Industrial has announced two transactions to foster its expansion. Early in the month, the marijuana REIT spent almost $27 million on a facility in central Massachusetts, with almost 200,000 square feet of space. Here, Innovative Industrial is working with longtime partner Ascend Wellness, which had done two real estate transactions with the company before. Ascend's triple net lease provides for rent equal to 13.5% of Innovative Industrial's total investment in the property, which includes a $22 million tenant improvement reimbursement provision.
In Michigan, Innovative Industrial did a sale and leaseback transaction with Cresco Labs on a property with 115,000 square feet for cultivation and processing. The real-estate specialist will spend a total of $16 million on the purchase and additional improvements, and Cresco will lease the space back under undisclosed terms.
When you put those new transactions into the mix, Innovative Industrial now has 55 properties in 15 states, with a total of 4.1 million square feet and an occupancy rate of 99.1%. With average weighted lease terms extending 16 years into the future, Innovative Industrial has high expectations for its ability to keep pulling in income from the real estate it's leasing to its marijuana company partners.
Firing back at critics
Innovative Industrial has gotten criticism from skeptics. Earlier this month, Grizzly Research accused the company of owning low-quality real estate and failing to ensure that tenants have the staying power to meet their lease obligations. Yet some of those accusations don't seem to stand up to further scrutiny.
The marijuana industry continues to evolve, and some cannabis growers have succeeded at the expense of others. Innovative Industrial, however, has found a niche it can keep expanding. So far, shareholders have been quite happy with what they've seen.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Dan Caplinger has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Innovative Industrial Properties. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Most of the best-known cultivation stocks, such as Canopy Growth (NYSE: CGC) and Aurora Cannabis (NYSE: ACB), have seen their shares drop significantly since early 2018. Ascend's triple net lease provides for rent equal to 13.5% of Innovative Industrial's total investment in the property, which includes a $22 million tenant improvement reimbursement provision. The real-estate specialist will spend a total of $16 million on the purchase and additional improvements, and Cresco will lease the space back under undisclosed terms. | Most of the best-known cultivation stocks, such as Canopy Growth (NYSE: CGC) and Aurora Cannabis (NYSE: ACB), have seen their shares drop significantly since early 2018. The basics of Innovative Industrial Properties Innovative Industrial Properties has a business model that's far different from the big-name marijuana growers above. How Innovative Industrial hopes to fuel higher future dividends Innovative Industrial has been able to give dividend investors what they want to see by continually looking for good prospects in the real estate market. | Most of the best-known cultivation stocks, such as Canopy Growth (NYSE: CGC) and Aurora Cannabis (NYSE: ACB), have seen their shares drop significantly since early 2018. Innovative Industrial Properties (NYSE: IIPR) continued to profit from its real-estate-minded approach to the marijuana market, and despite attacks from skeptical investing analysts, Innovative Industrial hasn't slowed down in its pursuit of promising properties for its cannabis partners. The basics of Innovative Industrial Properties Innovative Industrial Properties has a business model that's far different from the big-name marijuana growers above. | Most of the best-known cultivation stocks, such as Canopy Growth (NYSE: CGC) and Aurora Cannabis (NYSE: ACB), have seen their shares drop significantly since early 2018. Innovative Industrial Properties (NYSE: IIPR) continued to profit from its real-estate-minded approach to the marijuana market, and despite attacks from skeptical investing analysts, Innovative Industrial hasn't slowed down in its pursuit of promising properties for its cannabis partners. How Innovative Industrial hopes to fuel higher future dividends Innovative Industrial has been able to give dividend investors what they want to see by continually looking for good prospects in the real estate market. |
37550.0 | 2020-04-26 00:00:00 UTC | The 3rd Country to Legalize Marijuana Is... Going to Have to Wait Up to 8 More Months | ACB | https://www.nasdaq.com/articles/the-3rd-country-to-legalize-marijuana-is...-going-to-have-to-wait-up-to-8-more-months-2020 | nan | nan | For much of the past half-decade, marijuana has been one of the fastest-growing industries. After generating $3.4 billion in worldwide sales in 2014, global weed sales more than tripled to $10.9 billion by 2018. According to various Wall Street estimates, worldwide pot sales should hit $50 billion on an annual basis by 2030, with North America generating the bulk of this revenue.
Although there are more than three dozen countries around the world where medical cannabis has been legalized to some degree, it's recreational marijuana that's going to be the industry's long-term revenue driver. The patient pool for adult-use weed is considerably larger than it is with medical marijuana, and recreational sales tend to cannibalize the medical pot industry, once legal. After all, there's no need to wait for a physician's prescription if you can simply walk into a dispensary and buy cannabis products.
Image source: Getty Images.
To date, only two countries in the world have waved the green flag on recreational marijuana. Uruguay was the first to do so in December 2013. The second was our northerly neighbor, Canada, which officially began selling adult-use marijuana on Oct. 17, 2018. The question has been, with popularity for cannabis budding like never before, which country would next to legalize recreational pot?
Mexico's Supreme Court extends the recreational cannabis legalization deadline... again
We appeared to get our answer to this question on Oct. 31, 2018. On that date, Mexico's Supreme Court ruled that it was unconstitutional to ban the possession or use of recreational marijuana. This happened to be the fifth time that Mexico's highest court had issued this ruling, which in Mexican law makes this ruling the standard to be set throughout the country. Effectively, Mexico's Supreme Court gave adult-use marijuana a green light on Halloween 2018.
However, Mexico's Supreme Court is only able to decide what is and isn't lawful. It has no say on actually crafting legislation. Thus, this ruling meant Mexico's lawmakers would need to come together to develop a framework for a regulated and legal marijuana market. The Supreme Court gave lawmakers a full year to get that done.
Image source: Getty Images.
Unsurprisingly, though (note the sarcasm), they waited until October 2019 to really dig into the details of a proposal. As such, Mexico's highest court granted a one-time extension to hash out the details and approve legislation concerning a legal cannabis market by no later than end of April 2020. At the time, the Supreme Court was very clear that this would be the only extension granted on this issue.
And then the coronavirus disease 2019 (COVID-19) struck. There are more than 2.6 million confirmed cases of this respiratory disease worldwide, with dozens of countries around the globe taking stringent measures to reduce transmission rates. With Mexico among those countries shutting down businesses to slow disease proliferation, legislation at the congressional level has come to a virtual standstill. This prompted the Supreme Court to go back on its "one-time extension" and once again extend the deadline for lawmakers to end the prohibition of cannabis.
The new deadline is December 15, 2020, which marks the end of the legislative session for Mexico's congress. Considering how lawmakers have slow-stepped working out the details of this proposal thus far, legalization shouldn't be expected, in full, for another eight months.
Image source: Getty Images.
Legalizing marijuana in Mexico will likely be a non-event for pot stock investors
Although there are still plenty of details left to be discussed, there are some aspects of Mexico's marijuana legalization proposal that are pretty much decided, according to Marijuana Moment. In no particular order:
Adults aged 18 and older will be allowed to purchase and cultivate marijuana for personal use.
Personal possession is to be limited to 28 grams, but possession would be decriminalized up to 200 grams.
People would be allowed to grow up to 20 registered plants, as long as the yield doesn't top 480 grams annually. Medical pot patients could apply to cultivate even more plants.
Legal marijuana would be taxed at a 12% rate.
Public consumption of cannabis would be allowed, except for spaces that are specifically designated as smoke-free.
The Mexican Institute of Regulation and Control of Cannabis would be in charge of regulating the legal marijuana market and issuing business licenses.
Then again, there are particulars of the legalization proposal that remain very much up in the air.
Image source: Getty Images.
For example, there continues to be push-back from legalization advocates over the lack of protections for domestic farmers, as well as other social equity provisions. In other words, legalization proponents want to see those most disenfranchised by the drug war benefit most from its legalization. Lawmakers have offered no certainties one way or the other whether this would happen, albeit a previous iteration of this legalization proposal significantly limited the ability of big corporations to land cannabis business licenses in Mexico.
Previous legalization proposals have also suggested that edibles and infused beverages would remain banned for recreational consumers and only be available to medical pot patients. This is noteworthy given that dried cannabis flower is easily commoditized and generally a low-margin product. Edibles and infused beverages are expected to be a source of juicy margins for marijuana companies. Without access to these products, Mexico's recreational sales potential may be limited.
The only major company with any sort of presence in Mexico at the moment is Aurora Cannabis (NYSE: ACB). Aurora acquired pharmacy distribution business Farmacias Magistrales a little over a year ago, giving the company access to more than 500 hospitals throughout the country. However, if higher-margin derivatives are effectively banned on the recreational side of the equation, Aurora Cannabis would have to settle for quantity over quality in terms of revenue generation.
And, at this point, there's no guarantee that a company like Aurora Cannabis would even qualify for a recreational business license given its size. With advocates focused on propping up domestic farmers and businesses, Mexico looks to be a market pot stock investors will want to watch from a safe distance.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Sean Williams has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The only major company with any sort of presence in Mexico at the moment is Aurora Cannabis (NYSE: ACB). According to various Wall Street estimates, worldwide pot sales should hit $50 billion on an annual basis by 2030, with North America generating the bulk of this revenue. There are more than 2.6 million confirmed cases of this respiratory disease worldwide, with dozens of countries around the globe taking stringent measures to reduce transmission rates. | The only major company with any sort of presence in Mexico at the moment is Aurora Cannabis (NYSE: ACB). Mexico's Supreme Court extends the recreational cannabis legalization deadline... again We appeared to get our answer to this question on Oct. 31, 2018. This happened to be the fifth time that Mexico's highest court had issued this ruling, which in Mexican law makes this ruling the standard to be set throughout the country. | The only major company with any sort of presence in Mexico at the moment is Aurora Cannabis (NYSE: ACB). Although there are more than three dozen countries around the world where medical cannabis has been legalized to some degree, it's recreational marijuana that's going to be the industry's long-term revenue driver. Legalizing marijuana in Mexico will likely be a non-event for pot stock investors Although there are still plenty of details left to be discussed, there are some aspects of Mexico's marijuana legalization proposal that are pretty much decided, according to Marijuana Moment. | The only major company with any sort of presence in Mexico at the moment is Aurora Cannabis (NYSE: ACB). On that date, Mexico's Supreme Court ruled that it was unconstitutional to ban the possession or use of recreational marijuana. Legalizing marijuana in Mexico will likely be a non-event for pot stock investors Although there are still plenty of details left to be discussed, there are some aspects of Mexico's marijuana legalization proposal that are pretty much decided, according to Marijuana Moment. |
37551.0 | 2020-04-25 00:00:00 UTC | Will Aphria Flourish in 2020 Despite the Cannabis Industry's Struggles? | ACB | https://www.nasdaq.com/articles/will-aphria-flourish-in-2020-despite-the-cannabis-industrys-struggles-2020-04-25 | nan | nan | Are you convinced it's time to give up on marijuana stocks? There's one that might be worth holding on to: Aphria (NYSE: APHA), which has consistently maintained its profitability despite the cannabis industry's (and the larger market's) struggles.
Aphria's ongoing profitability is impressive
High, consistent profits demonstrate how well a company is handling its operating expenses. Aphria has shown positive EBITDA (earnings before interest, taxes, depreciation, and amortization) over the past three quarters, while most cannabis companies reported negative earnings. In its recent fiscal third-quarter earnings, Aphria recorded a positive adjusted EBITDA of 5.7 million Canadian dollars.
While peers are burdened with debt or on the verge of bankruptcy, Aphria ended the quarter with CA$515.1 million of cash and cash equivalents. It also raised CA$100 million in equity capital to strengthen its balance sheet. The money will be put toward expansion in Canada and internationally, giving me faith in Aphria to survive the COVID-19 chaos.
Image Source: Getty Images.
Another point that caught my attention: Unlike other marijuana companies, Aphria hasn't had many layoffs. This is evidence that the company is not in a financial crisis — it doesn't need to cut down its workforce to conserve cash amid the COVID-19 pandemic. Aurora Cannabis (NYSE: ACB), Hexo (NYSE: HEXO), and Canopy Growth (NYSE: CGC) have all had to make significant workforce reductions in order to survive.
Why is leadership important in a growing industry?
The leadership team is the pillar of any company, and over the past year, those teams have crumbled at many major players, reflecting instability in the sector. Investors usually take it as a negative sign when a leadership team falls, and changes at the executive level can also affect the stock price of a company.
Look what happened to Aurora Cannabis after its CEO, Terry Booth, stepped down in February. The struggling company's stock price went crashing down after the announcement. Cannabis giant Canopy Growth also terminated its CEO, Bruce Linton, in June of last year after entering into its partnership with Constellation Brands (NYSE: STZ). Investors didn't take either move well — Canopy's and Aurora's stock prices are down 27% and 67% year-to-date, respectively, and neither has achieved positive EBITDA.
In Aphria's case, though, CEO Irwin Simon has changed the face of the company since taking on the role in 2019. In December 2018, Irwin joined Aphria as the independent chair of its board of directors. He took over the role of interim CEO in March 2019. Since then, Irwin has stressed that it would be wise for Aphria to focus on its roots — namely, the Canadian province of Ontario.
As mentioned, during Irwin's tenure as CEO, Aphria has repeatedly reported positive EBITDA. Irwin is the founder of Hain Celestial (NYSE: HAIN), which he ran as a successful packaged-food company for 25 years. This gives me confidence in Irwin's leadership, and I believe his experience and skills can take Aphria to greater heights.
Medical cannabis is one of Aphria's strengths
Consumer desire for medical cannabis is more evident than ever during the coronavirus pandemic; in fact, increased demand has forced many U.S. states and Canada to designate marijuana an essential item.
More consumers are beginning to understand the benefits of medical marijuana over conventional medicines — especially for severe medical conditions such as cancer, arthritis, Parkinson's disease, and many other neurological conditions. Data by Grand View Research shows that in North America, medical cannabis made up 71% of sales in 2019.
Aphria already has a strong presence with its medical marijuana operations in Canada, Europe, Africa, South America, and Oceania. Its Germany-based subsidiary, CC Pharma, saw a 50% increase in medical cannabis sales in the third quarter.
Aphria has a compelling product portfolio — both for medical and recreational use — under the brand names Solei, Aphria, Broken Coast, RIFF, and Good Supply. Its medical cannabis sales made up about 13% of the total in the third quarter, a 14% decrease from the previous quarter owing to a fall in average retail selling price.
The medical cannabis market is booming in the U.S. and worldwide, which will provide more opportunities for Aphria. As of now, 33 states and the District of Columbia have legalized medical marijuana. More states are in the process of legalizing medical cannabis this year if the pandemic doesn't slow them down. A Gallup survey showed that 86% of Americans see the medical benefits of marijuana as an important reason to support legalization. And Mexico could also legalize marijuana in 2020.
Cannabis 2.0: Not all hope is lost
There was a lot of hype about cannabis 2.0 products — edibles, extracts, and the like — before Canada legalized them last year. Don't get me wrong, there's still huge demand for these offerings. It's just that the timing wasn't right. These products were legalized in October, but regulatory issues and a delay in the opening of legal stores extended into 2020. And then the pandemic hit.
Aphria has captured a significant portion of the adult-use cannabis market. In its third quarter, recreational cannabis sales made up almost 70% of the total. (As mentioned, medical cannabis was about 13%; the remainder was wholesale.) For cannabis 2.0, Aphria in the process of developing high-quality vape products. We will also see high-margin derivative products — edibles, beverages, concentrates, and topicals — soon. Aphria says the production capacity at its Canadian cultivation facilities is as high as 255,000 kilograms a year.
The global legal cannabis market (both medical and recreational) rose 48% year-over-year to $15 billion in 2019. It could grow to as much as $73.6 billion by 2027, according to Grand View Research. In the U.S. alone, cannabis sales could grow by 38% this year, and while the U.S. medical cannabis market is currently larger, recreational cannabis could driveglobal marketgrowth through 2024, according to Arcview Market Research.
That's why I think cannabis 2.0 products still have a chance to revive the industry once the coronavirus has retreated. For now, Aphria has suspended its guidance because of the uncertainty from the pandemic. But once things normalize, the growth from cannabis 2.0 products could drive Aphria's revenue and profitability. The company expects its vape products sales to show results in Q4 2020 and Q1 2021. Edibles and gummies will further drive sales in the later half of fiscal 2021.
Aphria: an intriguing cannabis bet
Marijuana is, no doubt, a growing industry — just look at the demand in Canada and the United States. Not every cannabis stock is worth buying, though, and even the more stable ones aren't completely safe. That said, if you are an investor who can handle the risk for a while, Aphria — with its strong financial footing and excellent leadership team — could bear fruit for you in the long term.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Sushree Mohanty has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Constellation Brands. The Motley Fool recommends HEXO. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Aurora Cannabis (NYSE: ACB), Hexo (NYSE: HEXO), and Canopy Growth (NYSE: CGC) have all had to make significant workforce reductions in order to survive. Investors usually take it as a negative sign when a leadership team falls, and changes at the executive level can also affect the stock price of a company. Cannabis giant Canopy Growth also terminated its CEO, Bruce Linton, in June of last year after entering into its partnership with Constellation Brands (NYSE: STZ). | Aurora Cannabis (NYSE: ACB), Hexo (NYSE: HEXO), and Canopy Growth (NYSE: CGC) have all had to make significant workforce reductions in order to survive. Data by Grand View Research shows that in North America, medical cannabis made up 71% of sales in 2019. In the U.S. alone, cannabis sales could grow by 38% this year, and while the U.S. medical cannabis market is currently larger, recreational cannabis could driveglobal marketgrowth through 2024, according to Arcview Market Research. | Aurora Cannabis (NYSE: ACB), Hexo (NYSE: HEXO), and Canopy Growth (NYSE: CGC) have all had to make significant workforce reductions in order to survive. Medical cannabis is one of Aphria's strengths Consumer desire for medical cannabis is more evident than ever during the coronavirus pandemic; in fact, increased demand has forced many U.S. states and Canada to designate marijuana an essential item. In the U.S. alone, cannabis sales could grow by 38% this year, and while the U.S. medical cannabis market is currently larger, recreational cannabis could driveglobal marketgrowth through 2024, according to Arcview Market Research. | Aurora Cannabis (NYSE: ACB), Hexo (NYSE: HEXO), and Canopy Growth (NYSE: CGC) have all had to make significant workforce reductions in order to survive. As mentioned, during Irwin's tenure as CEO, Aphria has repeatedly reported positive EBITDA. More states are in the process of legalizing medical cannabis this year if the pandemic doesn't slow them down. |
37552.0 | 2020-04-23 00:00:00 UTC | Aurora Cannabis: A Trio of Writedowns Likely Awaits | ACB | https://www.nasdaq.com/articles/aurora-cannabis%3A-a-trio-of-writedowns-likely-awaits-2020-04-23 | nan | nan | The past 12-plus months have not been kind to marijuana stock investors. Following many years of outperformance and a first quarter (of 2019) that saw more than a dozen popular pot stocks gain at least 70%, cannabis stocks have been stuck in a perpetual downtrend ever since. In fact, most pot stocks have lost anywhere from 50% to 95% of their value since the beginning of April 2019.
This weakness can be blamed on exorbitant tax rates in the U.S. that have made it difficult for licensed producers to compete with illicit growers, and regulatory issues in Canada that have challenged the rollout of dried cannabis and derivative products.
Image source: Getty Images.
Aurora Cannabis is the marijuana industry's biggest disappointment
But there's not a marijuana stock that's been more disappointing than Aurora Cannabis (NYSE: ACB). At one time, Aurora was projected to produce more cannabis per year (at its peak) than any other grower, and it had access to more overseas markets than any other licensed producer. And to this day, it still remains the most-held stock on millennial-focused online investing app Robinhood.
Unfortunately, Aurora Cannabis has been a veritable dumpster fire. The company continues to lose money at an extraordinary pace, and it appears to lack the cash needed to meet its expected liabilities over the coming 12-month period. For Aurora Cannabis, issuing its stock as if it were Monopoly money has been its primary means of raising capital and paying for acquisitions. Since the end of June 2014, the company's outstanding share count has grown from just 16 million shares to more than 1.31 billion shares, and the initiation of a $350 million at-the-market share offering last week may pave the way for another 500 million shares to be sold.
The culmination of Aurora's struggles was the announcement last week that it'll be enacting a 1-for-12 reverse stock split on or about May 11, 2020 in order to regain compliance with the New York Stock Exchange to avoid delisting.
Yet, getting its share price back above $1 doesn't make Aurora's many problems disappear. On the contrary, with delisting now out of the way it may shine light on the growing likelihood that a trio of writedowns awaits this highly dysfunctional licensed producer.
Image source: Getty Images.
A goodwill writedown looks all but certain
First of all, I see an all-but-certain additional writedown in the company's future concerning the $2.41 billion Canadian in goodwill it ended with in the fiscal second quarter.
Aurora Cannabis hasn't been shy about making acquisitions, with the most popular pot stock gobbling up more than a dozen companies since August 2016. However, hindsight being what it is, these deals wound up being grossly overpriced and the premium paid looks highly unlikely to be recouped by Aurora. Even after writing down CA$762 million in goodwill during Q2 2020, Aurora's remaining goodwill accounts for 52% of its total assets, and perhaps an even higher percentage in future quarters if operating losses continue to eat away at its cash on hand.
What makes a writedown exceptionally likely, in my view, is that the CA$762 million impairment in Q2 2020 was mostly tied to its assets in South America and Denmark. However, the CA$2.64 billion MedReleaf acquisition is, hands down, the worst deal of all time. There's absolutely no way for Aurora to justify a CA$2.64 billion price tag for 35,000 kilos of annual output and a couple of proprietary brands. Remember, the 1-million-square-foot Exeter greenhouse, which was a highlight of this deal and touted as being capable of 105,000 kilos of cannabis output per year, once retrofit, is now up for sale for a mere CA$17 million.
Image source: Getty Images.
A writedown on idled or underutilized assets may be necessary
A second impairment that may await Aurora Cannabis concerns the value of its property and equipment.
Along with the massive CA$762 million goodwill writedown, Aurora also wrote down nearly CA$52 million in the value of its property, plant & equipment during Q2 2020. This bulk of this writedown was tied to the construction halt at the 1-million-square-foot Aurora Nordic 2 facility in Denmark, with the value of the real estate, production equipment, and land also adjusted lower.
The problem is that the Aurora Nordic 2 facility isn't the only asset that could sit idle or underutilized while Canada works its way through regulatory issues. Aurora Cannabis has also halted construction on the 1.62-million-square-foot Aurora Sun facility in Alberta and plans to only utilize 238,000 square feet (six grow rooms) for the current fiscal year. Without an improved retail presence in Ontario, which is unlikely to happen with the proliferation of the coronavirus disease 2019 (COVID-19), Canadian markets simply can't absorb any additional production from Aurora Cannabis.
Facing the realization of extended production downtime or underutilization, coupled with the fact that it would be virtually impossible to sell these assets at anywhere near fair value right now, I'm expecting the CA$1 billion value of property, plant & equipment recognized on the balance sheet to decline in the coming quarters.
Image source: Getty Images.
A writedown on excess inventory could be in the offing
In addition to the above two writedowns, I also view it increasingly likely that Aurora Cannabis may need to take an impairment on the value of its inventory,
According to MKM Partners' covering analyst Bill Kirk in February, Canada's entire legal market has been consuming about 180,000 kilos of pot on an annual run-rate basis. Aurora Cannabis by itself is on track to produce approximately 150,000 kilos in fiscal 2020. Even though we're going to see Canada's legal run-rate demand improve as more retail stores open for business in key provinces like Ontario, existing output is already flooding the market -- and these licensed producers aren't anywhere near their peak potential.
As of the end of December 2019, Aurora Cannabis had CA$205.5 million in built up inventory, which trails only the CA$622.6 million in inventory that Canopy Growth is sitting on. At the current annual run-rate, and taking into account smaller licensed producers that aren't public, there might be enough cannabis in inventory to satiate Canadian demand for the next two years without growing an additional plant.
Aurora's marijuana can't sit on the sideline forever, which makes ongoing supply bottlenecks a likely reason to write down some of the value of its inventory.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Sean Williams has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Aurora Cannabis is the marijuana industry's biggest disappointment But there's not a marijuana stock that's been more disappointing than Aurora Cannabis (NYSE: ACB). This weakness can be blamed on exorbitant tax rates in the U.S. that have made it difficult for licensed producers to compete with illicit growers, and regulatory issues in Canada that have challenged the rollout of dried cannabis and derivative products. Without an improved retail presence in Ontario, which is unlikely to happen with the proliferation of the coronavirus disease 2019 (COVID-19), Canadian markets simply can't absorb any additional production from Aurora Cannabis. | Aurora Cannabis is the marijuana industry's biggest disappointment But there's not a marijuana stock that's been more disappointing than Aurora Cannabis (NYSE: ACB). A goodwill writedown looks all but certain First of all, I see an all-but-certain additional writedown in the company's future concerning the $2.41 billion Canadian in goodwill it ended with in the fiscal second quarter. Even after writing down CA$762 million in goodwill during Q2 2020, Aurora's remaining goodwill accounts for 52% of its total assets, and perhaps an even higher percentage in future quarters if operating losses continue to eat away at its cash on hand. | Aurora Cannabis is the marijuana industry's biggest disappointment But there's not a marijuana stock that's been more disappointing than Aurora Cannabis (NYSE: ACB). A writedown on excess inventory could be in the offing In addition to the above two writedowns, I also view it increasingly likely that Aurora Cannabis may need to take an impairment on the value of its inventory, According to MKM Partners' covering analyst Bill Kirk in February, Canada's entire legal market has been consuming about 180,000 kilos of pot on an annual run-rate basis. As of the end of December 2019, Aurora Cannabis had CA$205.5 million in built up inventory, which trails only the CA$622.6 million in inventory that Canopy Growth is sitting on. | Aurora Cannabis is the marijuana industry's biggest disappointment But there's not a marijuana stock that's been more disappointing than Aurora Cannabis (NYSE: ACB). At one time, Aurora was projected to produce more cannabis per year (at its peak) than any other grower, and it had access to more overseas markets than any other licensed producer. Aurora Cannabis hasn't been shy about making acquisitions, with the most popular pot stock gobbling up more than a dozen companies since August 2016. |
37553.0 | 2020-04-22 00:00:00 UTC | Ranking the ‘Big 4’ Canadian Marijuana Stocks From Best to Worst | ACB | https://www.nasdaq.com/articles/ranking-the-big-4-canadian-marijuana-stocks-from-best-to-worst-2020-04-22 | nan | nan | InvestorPlace - Stock Market News, Stock Advice & Trading Tips
This year has been a disappointing year for investors across the board. However, it has been especially disappointing for investors of marijuana stocks. After a horrible 2019, cannabis investors were hoping stocks would bounce back in 2020 as Canada rolls out its Cannabis 2.0 legalization of edibles, vapes, infused beverages and other products.
Instead, the novel coronavirus outbreak has cannabis customers stuck at home and retail stores closed indefinitely. The good news for marijuana stocks is that there is plenty of evidence that the crisis has boosted cannabis demand. However, the problem is that the coronavirus has also created an uncertain path forward, especially for companies with shaky balance sheets and aggressive cash burn.
7 of the Best Large-Cap Stocks to Buy Now
That said, the so-called “big four” Canadian legal cannabis producers are each down between 24% and 70% year-to-date. They are as follows:
Aurora Cannabis (NYSE:ACB)
Canopy Growth Corp (NYSE:CGC)
Cronos (NASDAQ:CRON)
Tilray (NASDAQ:TLRY)
The cannabis space will likely continue to be difficult to navigate in the near-term. However, I’m one of many cannabis bulls that believes there will be some huge cannabis winners in the long term. So, for investors looking to buy the dip in cannabis, here’s a rundown of the big four Canadian marijuana stocks — ranked from best to worst.
Big 4 Marijuana Stocks: Canopy Growth Corp (CGC)
Source: Jarretera / Shutterstock.com
As I recently wrote, CGC stock is the only cannabis stock that I have personally bought during the current downturn. It’s also the only one that I own, period. I actually had no intention of buying any cannabis stocks. However, when I saw Canopy trading under $12 per share, it simply seemed too cheap to ignore.
In a nutshell, Canopy is the largest Canadian cannabis producer — both by market share and by market capitalization. It has one of the best balance sheets in the industry, along with a deep-pocketed minority investor in international alcohol giant Constellation Brands (NYSE:STZ). Last year, Canopy gave its founder and CEO the boot and replaced him with the former Constellation CFO. And as I’ve said before, I think there’s a good chance Constellation replaced Canopy’s CEO in preparation for a potential full buyout at some point.
In the meantime, Canopy has a conditional buyout in place to take over one of the largest multi-state operators in the U.S., Acreage Holdings (OTC:ACRGF). So if the U.S. legalizes marijuana, Canopy has an immediate first-mover advantage.
Therefore, if you are bullish on marijuana stocks, you need to own CGC stock. It’s certainly not risk-free, but it’s the safest bet in the Canadian cannabis space these days.
Cronos (CRON)
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Source: Shutterstock
A year ago, the cannabis bull case was all about rapid growth. Today, however, the focus is on playing defense and having a healthy balance sheet.
I’m a value investor at heart, and so I always prefer companies that are focusing on profitability and liquidity rather than growth at all costs. The good news for CRON stock investors is that the company has one of the healthiest balance sheets in the industry. The bad news, however, is that it hasn’t really made much progress in expanding its business or advancing its strategy.
Moreover, Bank of America analyst Christopher Carey describes Cronos’ problem as “strategy paralysis.”
“We appreciate CRON has not intended to be in a ‘revenue race,’ which has likely shielded it from pitfalls faced by peers,” Carey says.
Unfortunately, while it hasn’t overextended itself financially, it also doesn’t seem to be making much progress on any fronts.
“We still see a path for Cronos to emerge from the early stages of this new sector w/ leadership, and portfolio optionality ex-Canada may be a part of that, but right now we prefer companies with tangible (and trackable) businesses,” Carey says.
3 Stocks to Buy for a Quick Post-Coronavirus Turnaround
In other words, most cannabis companies have been too offensive while Cronos has been too defensive.
Tilray (TLRY)
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Source: Shutterstock
Tilray stock is in trouble. The stock is down nearly 61% in 2020, and more than 86% in the past year. To me, Canopy and Cronos are in their own class of solid companies dealing with a rough patch. Meanwhile, Tilray and Aurora are in another category of growth stocks with no growth.
On March 31, Tilray unlocked 11 million shares of Class 2 common stock held by former Privateer Holdings investors. At one time, the fund held 77% of Cronos’ outstanding shares.
In other words, Tilray has released 11 million of Privateer’s 75 million shares. There are still 64 million left to go. In the meantime, Cronos has delivered inconsistent financial results. At the same time, its cash burn has been very high considering its tight balance sheet. On March 13, Tilray raised $90 million in cash and diluted its shareholders by a staggering 37%.
“While I understand the need to raise funds, I am surprised Tilray management would pretty much choose the worst of times to price the offering,” Cantor Fitzgerald analyst Pablo Zuanic said.
To me, that questionable decision speaks to the desperate situation Tilray finds itself in today. At this point, Tilray’s future has more to do with accounting and finance than it does to do with cannabis. Overall, I’d say stay away unless you are extremely risk averse.
Aurora Cannabis (ACB)
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Source: Jarretera / Shutterstock.com
Aurora has been the worst-performing of the big four marijuana stocks It is down 67% in 2020, and 92% overall in the past year. Like Tilray, Aurora just announced a new $350 million equity facility out of sheer desperation. To maintain its listing on the NYSE, Aurora also announced a 12-to-1 reverse stock split.
Prior to the new capital raise, Aurora had $205 million in cash as of the end of March. It burned $174 million in cash in the most recent quarter. At this point, Aurora must demonstrate significant earnings upside and improvements in cash burn over the next two quarters. If not, the stock is likely headed to $0.
Additionally, Aurora stock is looking increasingly like the type of company that goes under during an economic downturn. I’ve called the stock a lottery ticket — and like a lottery ticket, it’s probably a loser. But if the company can figure out how to turn things around, investors could still hit the jackpot.
Wayne Duggan has been a U.S. News & World Report Investing contributor since 2016 and is a staff writer at Benzinga, where he has written more than 7,000 articles. Mr. Duggan is the author of the book “Beating Wall Street With Common Sense,” which focuses on investing psychology and practical strategies to outperform the stock market. As of this writing, Wayne Duggan was long CGC stock.
The post Ranking the ‘Big 4’ Canadian Marijuana Stocks From Best to Worst appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | They are as follows: Aurora Cannabis (NYSE:ACB) Canopy Growth Corp (NYSE:CGC) Cronos (NASDAQ:CRON) Tilray (NASDAQ:TLRY) The cannabis space will likely continue to be difficult to navigate in the near-term. Aurora Cannabis (ACB) ACB)" width="300" height="169"> Source: Jarretera / Shutterstock.com Aurora has been the worst-performing of the big four marijuana stocks It is down 67% in 2020, and 92% overall in the past year. “We still see a path for Cronos to emerge from the early stages of this new sector w/ leadership, and portfolio optionality ex-Canada may be a part of that, but right now we prefer companies with tangible (and trackable) businesses,” Carey says. | They are as follows: Aurora Cannabis (NYSE:ACB) Canopy Growth Corp (NYSE:CGC) Cronos (NASDAQ:CRON) Tilray (NASDAQ:TLRY) The cannabis space will likely continue to be difficult to navigate in the near-term. Aurora Cannabis (ACB) ACB)" width="300" height="169"> Source: Jarretera / Shutterstock.com Aurora has been the worst-performing of the big four marijuana stocks It is down 67% in 2020, and 92% overall in the past year. Big 4 Marijuana Stocks: Canopy Growth Corp (CGC) Source: Jarretera / Shutterstock.com As I recently wrote, CGC stock is the only cannabis stock that I have personally bought during the current downturn. | They are as follows: Aurora Cannabis (NYSE:ACB) Canopy Growth Corp (NYSE:CGC) Cronos (NASDAQ:CRON) Tilray (NASDAQ:TLRY) The cannabis space will likely continue to be difficult to navigate in the near-term. Aurora Cannabis (ACB) ACB)" width="300" height="169"> Source: Jarretera / Shutterstock.com Aurora has been the worst-performing of the big four marijuana stocks It is down 67% in 2020, and 92% overall in the past year. Big 4 Marijuana Stocks: Canopy Growth Corp (CGC) Source: Jarretera / Shutterstock.com As I recently wrote, CGC stock is the only cannabis stock that I have personally bought during the current downturn. | They are as follows: Aurora Cannabis (NYSE:ACB) Canopy Growth Corp (NYSE:CGC) Cronos (NASDAQ:CRON) Tilray (NASDAQ:TLRY) The cannabis space will likely continue to be difficult to navigate in the near-term. Aurora Cannabis (ACB) ACB)" width="300" height="169"> Source: Jarretera / Shutterstock.com Aurora has been the worst-performing of the big four marijuana stocks It is down 67% in 2020, and 92% overall in the past year. 7 of the Best Large-Cap Stocks to Buy Now That said, the so-called “big four” Canadian legal cannabis producers are each down between 24% and 70% year-to-date. |
37554.0 | 2020-04-22 00:00:00 UTC | 3 Pot Stocks to Avoid Like the Plague for the Rest of 2020 | ACB | https://www.nasdaq.com/articles/3-pot-stocks-to-avoid-like-the-plague-for-the-rest-of-2020-2020-04-22 | nan | nan | If you think the beating the stock market has taken over the past two months is brutal, then chances are you haven't paid close attention to the cannabis space. Over the past 12-plus months, marijuana stocks have lost anywhere from 50% to 95% of their value and have, in many instances, wiped away years of gains.
The good news, if there's any to be found from such an abysmal performance, is that there is a quantifiably large market for pot stocks over the long term. Tens of billions of dollars are conducted in black-market sales each year, meaning there's ample opportunity to move these consumers into legal channels.
But the obvious bad news is that not every pot stock can be a winner. With the North American cannabis industry wrought with challenges, I'd suggest avoiding the following three pot stocks like the plague for the remainder of 2020, if not beyond.
Image source: Getty Images.
Aurora Cannabis
Despite being the most-held stock on the entirety of the millennial-focused Robinhood platform, Aurora Cannabis (NYSE: ACB) might be the most avoidable of all marijuana stocks. This is a company that just last week announced that it would enact a 1-for-12 reverse split just to keep its common stock listed on the New York Stock Exchange (NYSE) and avoid delisting. But make no mistake about it, shareholders are down a not-so-pleasant 92% since mid-March 2019.
From top to bottom, Aurora is a dumpster fire. The company continues to lose substantial amounts of money on an operating basis, has halted construction on two of its largest production projects, and has put another 1-million-square-foot greenhouse (Exeter) up for sale. Initially expected to top 660,000 kilos of peak annual output, Aurora Cannabis is on track for perhaps 150,000 kilos of production in fiscal 2020, and even this level is overwhelming ill-prepared domestic markets.
But the biggest issue just might be Aurora's balance sheet. The company has $205 million Canadian in cash, but anticipated at the end of Dec. 31, 2019, that it would face close to CA$374 million in liabilities over the next 12 months. This means issuing stock on a dilutive basis is pretty much the only way for Aurora Cannabis to raise cash. Having already ballooned its outstanding share count from 16 million to 1.31 billion in less than six years, Aurora may wind up issuing another $350 million worth (that's U.S. dollars) of its common stock.
There's also the growing possibility of a writedown. Even after taking a CA$762.2 million impairment against goodwill in the fiscal second quarter, Aurora Cannabis is still lugging around CA$2.41 billion in goodwill on its balance sheet. This works out to 52% of total assets and strongly suggests that the company grossly overpaid for its numerous acquisitions.
I could easily see Aurora Cannabis' stock losing another 50%, if not more, which makes it wholly avoidable.
Image source: Getty Images.
Tilray
Once a Wall Street darling, there's now virtually nothing about Canadian licensed producer Tilray (NASDAQ: TLRY) that makes it an attractive investment. As a reminder, this was a stock that listed its initial public offering at $17 in July 2018, ran up to $300 a share by mid-September, and hit $2 a share during the market meltdown last month. It's come full circle and some... and it's still not worth buying.
One of Tilray's biggest issues is it's being run as if it were a rudderless ship. Management has run with the idea that Tilray should focus its attention entirely on the U.S. and European markets. While these markets do offer higher sales potential than Canada, completely shifting the company's growth strategy six months after Canadian adult-use weed sales commenced was a really odd move. It also means having to outlay quite a bit of money to build up overseas infrastructure, which has whittled away Tilray's cash pile.
Speaking of cash, cash equivalents, and short-term investments, Tilray ended 2018 with a seemingly healthy $517.6 million (note, Tilray reports in U.S. dollars). However, by the time Dec. 31, 2019 rolled around, Tilray's cash pile had shrunk to less than $97 million. Left with little choice but to raise capital, Tilray wound up pricing a $90.4 million share offering during the midst of the coronavirus disease 2019 (COVID-19) pandemic. The $4.76 selling price for its shares was considerably lower than the previous day's closing price for the company.
To boot, there are warrants attached to these shares that can be exercised after six months at a price of $5.95. This is a fancy way of saying that shareholders are going to be diluted immediately by the stock sale, and could continue to be buried by new shares as warrants are exercised, thusly capping any near-term gains.
With no shot at profitability in 2020, Tilray is an easy pot stock for investors to bypass.
Image source: Getty Images.
HEXO
If you're noticing a theme here, it's that most Canadian licensed producers are an absolute mess, and Quebec-based HEXO (NYSE: HEXO) is no different. My expectation had been that signing the largest wholesale agreement in history with its home province of Quebec would have seriously de-risked HEXO as an investment -- but how wrong I've been. Even at less than $0.50 a share, HEXO remains entirely avoidable for the remainder of 2020.
Like Aurora Cannabis, HEXO has been paring back its operations as quickly as it can to conserve cash. It initial halted activity at its Niagara facility, which was acquired in the Newstrike Brands deal, but now has plans to close the facility permanently and sell it. HEXO has reduced its peak annual output potential by about a third over the last six months, and was responsible for laying off 200 workers back in October.
Similar to its peers, HEXO is facing a cash crunch that's forced it to turn to common stock offerings and convertible debt issuances to raise capital. Less than two weeks ago, HEXO completed a CA$46 million offering that saw close to 60 million new shares of stock get issued. Additionally, these shares came with warrants that have an exercise price of CA$0.96. Thus, similar to Tilray, any near-term upside is likely going to be capped by investors exercising their warrants and diluting the heck out of existing shareholders.
Unlike Aurora Cannabis, HEXO hasn't rectified its share price insufficiency with the NYSE, as of yet. Without a sustainable doubling in HEXO's share price, the company will need to enact a reverse split in the not-so-distant future, otherwise it could be delisted. Publicly traded companies that enact reverse splits have historically performed poorly after they're completed.
Also with no near-term chance at operating profitability, HEXO checks all the boxes for investor avoidance.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Sean Williams has no position in any of the stocks mentioned. The Motley Fool recommends HEXO. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Aurora Cannabis Despite being the most-held stock on the entirety of the millennial-focused Robinhood platform, Aurora Cannabis (NYSE: ACB) might be the most avoidable of all marijuana stocks. The company continues to lose substantial amounts of money on an operating basis, has halted construction on two of its largest production projects, and has put another 1-million-square-foot greenhouse (Exeter) up for sale. This is a fancy way of saying that shareholders are going to be diluted immediately by the stock sale, and could continue to be buried by new shares as warrants are exercised, thusly capping any near-term gains. | Aurora Cannabis Despite being the most-held stock on the entirety of the millennial-focused Robinhood platform, Aurora Cannabis (NYSE: ACB) might be the most avoidable of all marijuana stocks. Initially expected to top 660,000 kilos of peak annual output, Aurora Cannabis is on track for perhaps 150,000 kilos of production in fiscal 2020, and even this level is overwhelming ill-prepared domestic markets. Left with little choice but to raise capital, Tilray wound up pricing a $90.4 million share offering during the midst of the coronavirus disease 2019 (COVID-19) pandemic. | Aurora Cannabis Despite being the most-held stock on the entirety of the millennial-focused Robinhood platform, Aurora Cannabis (NYSE: ACB) might be the most avoidable of all marijuana stocks. Having already ballooned its outstanding share count from 16 million to 1.31 billion in less than six years, Aurora may wind up issuing another $350 million worth (that's U.S. dollars) of its common stock. Less than two weeks ago, HEXO completed a CA$46 million offering that saw close to 60 million new shares of stock get issued. | Aurora Cannabis Despite being the most-held stock on the entirety of the millennial-focused Robinhood platform, Aurora Cannabis (NYSE: ACB) might be the most avoidable of all marijuana stocks. Having already ballooned its outstanding share count from 16 million to 1.31 billion in less than six years, Aurora may wind up issuing another $350 million worth (that's U.S. dollars) of its common stock. I could easily see Aurora Cannabis' stock losing another 50%, if not more, which makes it wholly avoidable. |
37555.0 | 2020-04-21 00:00:00 UTC | Is Aurora Cannabis Stock a Buy? | ACB | https://www.nasdaq.com/articles/is-aurora-cannabis-stock-a-buy-2020-04-21 | nan | nan | Many cannabis stocks are trading for a fraction of the prices they commanded just a year ago. One of the most surprising crashes over the past 12 months has certainly been Aurora Cannabis (NYSE: ACB). As bad as the benchmark Horizons Marijuana Life Sciences ETF (OTC: HMLSF) has been, cratering by about 70% over the past year, Aurora's done even worse -- it's lost 92% of its value.
A lot has gone wrong for Aurora during that time, but if the company can turn things around, it's not inconceivable that the stock could double, triple, or even quadruple in price. That said, a turnaround is a lot easier said than done at this point. Let's take a look at whether the stock is a buy today, and if not, what needs to happen before investors should consider taking a chance on Aurora.
Concerns about cash are high
Undoubtedly the largest challenge facing Aurora and other pot stocks today is liquidity. In February, cannabis investment bank Ello Capital projected that Aurora had just 2.3 months' worth of liquidity left, among the worst in the sector. That was even before the coronavirus officially reached pandemic status and started wreaking havoc all over the world.
It's still too early to tell the effect that the pandemic will have on the industry, but it's certainly an added risk that could make cash even more scarce -- people who've suffered job losses will inevitably cut back on their expenses, including cannabis. And there have already been warning signs about a lack of cash flow at Aurora. On Feb. 6, a week before the company released its second-quarter results, Aurora announced it had eliminated nearly 500 full-time positions. A few months earlier, in November, Aurora also said that it was halting construction on two facilities in order to save cash -- Aurora Sun in Alberta, Canada, and Aurora Nordic 2 in Denmark.
Image source: Getty Images.
These are not the choices of a company in a strong financial position, and there's little reason to expect things will get any better, especially given recent results.
Growth's been virtually nonexistent
In its Q2 results, Aurora saw minimal revenue growth from the previous year. Net revenue totaling 56 million Canadian dollars was up a modest 3.4% from the prior-year quarter's CA$54.2 million. But compared with the first quarter, when net revenue was CA$75.2 million, the Q2 results show a quarter-over-quarter decline of 25.5%. The company also stated that it expects "modest to no growth" in its third quarter.
These are troubling numbers and projections for growth investors. And without a dividend or strong profits and fundamentals, there's really not much else the stock can offer. Some investors may be tempted to buy the stock for where it may be five years from now, but given the company's current cash issues, any progress will be an uphill battle.
There's no reason to invest in Aurora, at least not today
Things have gotten so bad for Aurora that earlier this month the company announced it will be doing a reverse stock split, in which shareholders will be given one share for every 12 they currently own. It's a way to get the stock price back above the $1 threshold, necessary because it was in danger of getting delisted from the NYSE if it didn't recover on its own.
But the reverse split doesn't fix any actual issues with the business; in fact, it just signifies how badly shares of Aurora have fallen. It could even make the stock a target for short sellers who see an opportunity for the price to fall even further. That's why investors who buy shares of the company today are taking on enormous risk, as there's no guarantee that Aurora's stock has hit a bottom.
For Aurora to be a buy, the company would have to show some significant progress in its financials. Not only should investors look for some double-digit growth, but the pot producer should also be generating positive cash flow from its operations, something it isn't doing today.
And to ensure any positive results are more than just an anomaly, investors should wait until the company demonstrates progress over at least two quarters. By settling for anything less, investors could be setting themselves and their portfolios up for some pain. With many other pot stocks out there, there's simply no reason to buy one as problematic as Aurora today.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
David Jagielski has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | One of the most surprising crashes over the past 12 months has certainly been Aurora Cannabis (NYSE: ACB). As bad as the benchmark Horizons Marijuana Life Sciences ETF (OTC: HMLSF) has been, cratering by about 70% over the past year, Aurora's done even worse -- it's lost 92% of its value. In February, cannabis investment bank Ello Capital projected that Aurora had just 2.3 months' worth of liquidity left, among the worst in the sector. | One of the most surprising crashes over the past 12 months has certainly been Aurora Cannabis (NYSE: ACB). These are not the choices of a company in a strong financial position, and there's little reason to expect things will get any better, especially given recent results. But compared with the first quarter, when net revenue was CA$75.2 million, the Q2 results show a quarter-over-quarter decline of 25.5%. | One of the most surprising crashes over the past 12 months has certainly been Aurora Cannabis (NYSE: ACB). A few months earlier, in November, Aurora also said that it was halting construction on two facilities in order to save cash -- Aurora Sun in Alberta, Canada, and Aurora Nordic 2 in Denmark. There's no reason to invest in Aurora, at least not today Things have gotten so bad for Aurora that earlier this month the company announced it will be doing a reverse stock split, in which shareholders will be given one share for every 12 they currently own. | One of the most surprising crashes over the past 12 months has certainly been Aurora Cannabis (NYSE: ACB). There's no reason to invest in Aurora, at least not today Things have gotten so bad for Aurora that earlier this month the company announced it will be doing a reverse stock split, in which shareholders will be given one share for every 12 they currently own. Not only should investors look for some double-digit growth, but the pot producer should also be generating positive cash flow from its operations, something it isn't doing today. |
37556.0 | 2020-04-20 00:00:00 UTC | Weekly Cannabis Stock News: Canopy Growth Makes a Strategic Retreat | ACB | https://www.nasdaq.com/articles/weekly-cannabis-stock-news%3A-canopy-growth-makes-a-strategic-retreat-2020-04-20 | nan | nan | "Thanks" to the SARS-CoV-2 coronavirus, all of us are living in a world that's suddenly gone topsy-turvy. For marijuana investors, last week saw a set of developments that at times seemed contradictory and counterintuitive.
Two formerly high-flying cannabis companies, Canopy Growth (NYSE: CGC) and Aurora Cannabis (NYSE: ACB), made moves of retrenchment and desperation rather than opportunity. Meanwhile, it was a relatively small player, Aphria (NYSE: APHA), that reported the sector's big feel-good news, delivering a bottom-line profit rare for the industry.
Image source: Getty Images.
Canopy Growth cuts, and Aurora attempts to avoid de-listing
These are difficult times for any company. They are especially challenging for marijuana businesses, many of which were losing money habitually and struggling to stay afloat well before the coronavirus hit. Still, it was a bit unnerving to witness the save-the-ship efforts undertaken by Canopy Growth and Aurora last week.
Canopy announced a set of restructuring measures, which basically consist of shutting down certain operations in various corners of the world where it's active. The lights will go out on its facilities in South Africa and the tiny nation it surrounds, Lesotho, as well as other growth/production assets in Colombia, the U.S. (a hemp farm it operates in upstate New York), and its native Canada (an indoor production facility in Saskatchewan).
All told, Canopy Growth will let go of around 85 employees and book 700 million Canadian ($500 million) to CA$800 million ($571 million) in pre-tax charges for these moves. At the end of the press release announcing them, the company wrote "[h]ere's to future growth." That's a hopeful and optimistic conclusion, but it'll take more than a handful of shutdowns to stanch this company's string of losses.
As for Aurora, its share price will soon zoom higher by a factor of 12! But this won't be for good reasons; lately, its shares haven't been meeting the New York Stock Exchange's minimum price requirement for listing (this is what happens when your stock slides below $1 per share and stays there). So, the company is doing a 12-for-1 reverse share split.
That's a relatively neat and painless way to satisfy the NYSE's listing requirement, but it's not going to inspire much confidence in the company or its prospects -- which have grown dimmer in recent times.
Compounding that, Aurora is also going to the markets once again to raise capital, floating $350 million in an at-the-market stock issue. So the company will, not for the first time, dilute existing shareholders. The feeling here is of a desperate business waving a giant HELP! sign to investors.
Aphria lands in the black
The good news for cannabis investors last week came from Aphria, which flipped into positive territory on the bottom line in its Q3 of fiscal 2020.
The period saw the company reap net revenue of just over CA$144 million ($103 million), for a sturdy 20% improvement over the previous quarter. Better, gross profit rose by nearly 51% to almost CA$60 million ($43 million), and best of all, the company netted a profit -- CA$5.7 million ($4.1 million) -- against the Q2 net loss of CA$7.9 million ($5.6 million).
Aphria is doing a fine job boosting its sales despite downward pressure on recreational marijuana retail prices. It's also getting good mileage out of CC Pharma, a medical marijuana distributor in Germany that has become a crucial revenue source for the company.
The "but" in this otherwise encouraging story is that Aphria is withdrawing its guidance for the full fiscal year. However, that's rather normal for publicly traded companies because of the tremendous economic uncertainty that's arisen from the coronavirus outbreak.
All thing considered, though, Aphria posted good numbers for its Q3. Meanwhile, its cash and equivalents position at quarter-end (CA$515 million, or $368 million) provides some security for a downturn. The company's stock ended the week over 12% higher, and while that reaction may be a bit optimistic -- the net profit was only $4 million-plus, after all -- Aphria is looking like one of the better cannabis stocks just now.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Two formerly high-flying cannabis companies, Canopy Growth (NYSE: CGC) and Aurora Cannabis (NYSE: ACB), made moves of retrenchment and desperation rather than opportunity. Meanwhile, it was a relatively small player, Aphria (NYSE: APHA), that reported the sector's big feel-good news, delivering a bottom-line profit rare for the industry. That's a relatively neat and painless way to satisfy the NYSE's listing requirement, but it's not going to inspire much confidence in the company or its prospects -- which have grown dimmer in recent times. | Two formerly high-flying cannabis companies, Canopy Growth (NYSE: CGC) and Aurora Cannabis (NYSE: ACB), made moves of retrenchment and desperation rather than opportunity. All told, Canopy Growth will let go of around 85 employees and book 700 million Canadian ($500 million) to CA$800 million ($571 million) in pre-tax charges for these moves. Better, gross profit rose by nearly 51% to almost CA$60 million ($43 million), and best of all, the company netted a profit -- CA$5.7 million ($4.1 million) -- against the Q2 net loss of CA$7.9 million ($5.6 million). | Two formerly high-flying cannabis companies, Canopy Growth (NYSE: CGC) and Aurora Cannabis (NYSE: ACB), made moves of retrenchment and desperation rather than opportunity. All told, Canopy Growth will let go of around 85 employees and book 700 million Canadian ($500 million) to CA$800 million ($571 million) in pre-tax charges for these moves. Better, gross profit rose by nearly 51% to almost CA$60 million ($43 million), and best of all, the company netted a profit -- CA$5.7 million ($4.1 million) -- against the Q2 net loss of CA$7.9 million ($5.6 million). | Two formerly high-flying cannabis companies, Canopy Growth (NYSE: CGC) and Aurora Cannabis (NYSE: ACB), made moves of retrenchment and desperation rather than opportunity. Aphria lands in the black The good news for cannabis investors last week came from Aphria, which flipped into positive territory on the bottom line in its Q3 of fiscal 2020. The company's stock ended the week over 12% higher, and while that reaction may be a bit optimistic -- the net profit was only $4 million-plus, after all -- Aphria is looking like one of the better cannabis stocks just now. |
37557.0 | 2020-04-19 00:00:00 UTC | Better Buy: Aurora Cannabis vs. Scotts Miracle-Gro | ACB | https://www.nasdaq.com/articles/better-buy%3A-aurora-cannabis-vs.-scotts-miracle-gro-2020-04-19 | nan | nan | Aurora Cannabis (NYSE: ACB) and Scotts Miracle-Gro (NYSE: SMG) rank as two of the more prominent names in the North American cannabis industry. But there's a stark contrast between the two companies' businesses and their stock performances.
While Aurora's share price has plummeted nearly 70% so far this year, Scotts Miracle-Gro stock has jumped by a double-digit percentage. Of course, these moves have made Aurora Cannabis cheaper than it's been in a long time and have put Scotts near its all-time highs.
Which of these marijuana stocks is the better pick now? Here's how Aurora and Scotts Miracle-Gro compare.
Image source: Getty Images.
The case for Aurora Cannabis
It's easy to find reasons not to buy Aurora Cannabis stock. The company continues to lose a lot of money. Aurora has had turnover in its executive ranks and is still searching for a permanent CEO. It has laid off much of its staff. The company is even planning to do a reverse stock split just to keep its shares listed on the New York Stock Exchange.
But are there any reasons to actually consider buying Aurora? Maybe.
Aurora Cannabis still claims a sizable market share in the Canadian adult-use recreational cannabis market. The company is also a leader in the country's medical cannabis market. Outside of Canada, Aurora continues to be a top supplier to the German medical cannabis market.
The company's investments in technology and automation have also reaped benefits. Aurora boasts one of the lowest production costs in the industry. It also has a production capacity that leads the industry, although the company isn't currently operating at maximum throughput.
Probably the best argument for Aurora is that the global cannabis industry should still expand significantly over the next few years. The company's scale of operations, cost structure, and existing market share combine to give Aurora a launching pad that few others can claim to go after this big opportunity.
There's also Aurora's valuation. The pot stock trades at less than four times sales. While the COVID-19 outbreak is weighing on sales now, once the crisis is over cannabis sales should regain momentum. Some investors could find Aurora's low price-to-sales ratio along with the likelihood of rising sales in the future appealing.
The case for Scotts Miracle-Gro
While Aurora Cannabis faces several headwinds, Scotts Miracle-Gro appears to have the wind at its back right now. The company topped expectations with its first-quarter results in January. Both of Scotts' core businesses are growing nicely. And its stock is trouncing the market so far this year.
Scotts Miracle-Gro's primary growth driver is its Hawthorne subsidiary. Helped by a string of acquisitions over the last few years, Hawthorne has become the top supplier of gardening products to the U.S. cannabis industry.
The opportunities for Hawthorne continue to expand. While the business already generates significant sales in California and Colorado, it's experiencing strong growth in newer markets including Florida, Michigan, and Illinois. With several states still in the early stages of their legal cannabis market launches and other states potentially on the way to legalizing either recreational or medical cannabis, Hawthorne should have plenty of room to run.
Don't overlook Scotts Miracle-Gro's consumer lawn and gardens business, though. The company is a longtime leader in the lawn and garden products market. Scotts' launches of new organics products have been quite successful. CEO Jim Hagedorn said in the company's Q1 conference call that the Performance Organics line is "one of the most important new products we've ever introduced."
Although Scotts Miracle-Gro isn't consistently generating profits right now, its losses aren't too concerning. The company continues to offer an attractive dividend, which currently yields around 2%.
Better buy
My view is that it's an easy decision between Aurora Cannabis and Scotts Miracle-Gro. The clear winner is Scotts.
Although I did my best to present the arguments for considering Aurora, I think that the company faces too many problems to buy the stock right now. Scotts Miracle-Gro isn't risk-free. It has a sizable debt and, as mentioned already, isn't profitable. However, my take is that Scotts is in a much stronger position than Aurora is.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Keith Speights has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Scotts Miracle-Gro. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Aurora Cannabis (NYSE: ACB) and Scotts Miracle-Gro (NYSE: SMG) rank as two of the more prominent names in the North American cannabis industry. The company's scale of operations, cost structure, and existing market share combine to give Aurora a launching pad that few others can claim to go after this big opportunity. While the business already generates significant sales in California and Colorado, it's experiencing strong growth in newer markets including Florida, Michigan, and Illinois. | Aurora Cannabis (NYSE: ACB) and Scotts Miracle-Gro (NYSE: SMG) rank as two of the more prominent names in the North American cannabis industry. The case for Aurora Cannabis It's easy to find reasons not to buy Aurora Cannabis stock. Aurora Cannabis still claims a sizable market share in the Canadian adult-use recreational cannabis market. | Aurora Cannabis (NYSE: ACB) and Scotts Miracle-Gro (NYSE: SMG) rank as two of the more prominent names in the North American cannabis industry. The case for Aurora Cannabis It's easy to find reasons not to buy Aurora Cannabis stock. The case for Scotts Miracle-Gro While Aurora Cannabis faces several headwinds, Scotts Miracle-Gro appears to have the wind at its back right now. | Aurora Cannabis (NYSE: ACB) and Scotts Miracle-Gro (NYSE: SMG) rank as two of the more prominent names in the North American cannabis industry. Outside of Canada, Aurora continues to be a top supplier to the German medical cannabis market. The case for Scotts Miracle-Gro While Aurora Cannabis faces several headwinds, Scotts Miracle-Gro appears to have the wind at its back right now. |
37558.0 | 2020-04-18 00:00:00 UTC | This Pot Stock's Price Is About to Soar -- But For All the Wrong Reasons | ACB | https://www.nasdaq.com/articles/this-pot-stocks-price-is-about-to-soar-but-for-all-the-wrong-reasons-2020-04-18 | nan | nan | The cannabis industry has gone through a tough period, and things don't look like they're poised to improve soon. After a year's worth of disappointing numbers following the opening of the Canadian market to recreational marijuana sales, many cannabis companies are struggling from the financial effects of the coronavirus pandemic.
One stock in particular stands out as having gone from boom to bust in a notably harsh way. Aurora Cannabis (NYSE: ACB) has seen its share price fall more than 80% in just the past six months, underperforming even companies like Tilray (NASDAQ: TLRY) and Canopy Growth (NYSE: CGC) in their recent struggles.
Marijuana investors are about to see Aurora's stock price soar. But don't get excited, because the upward move comes with a big catch for its shareholders.
Image source: Getty Images.
The latest move from Aurora
Aurora Cannabis has been stuck in a tough situation for a while now. Expansion plans proved to be overly ambitious, saddling the company with debt and leaving it with significant losses. Efforts to raise new capital through stock offerings also added to the downward pressure on the share price. As a result of these decisions, Aurora's stock price started flirting with the $1 per share level back in March. Coronavirus-imposed challenges have kept the shares below that mark since then.
Stock prices below $1 per share are problematic because they endanger a company's ability to keep its stock listed on major exchanges like the New York Stock Exchange. To avoid getting delisted, Aurora decided to do a reverse stock split. That should have the desired effect of getting the stock price back above the $1 mark.
Yet the particular type of reverse stock split Aurora chose showed that it wanted to have a lot of breathing room. Aurora will split its shares 1-for-12, which means that it wants to multiply its stock price 12-fold after the split takes effect on or around May 11. With the price around $0.70 per share recently, the reverse split should send Aurora's stock price soaring to around $8.40 per share.
Here's the catch
At first glance, seeing shares jump a dozen times higher could make some shareholders jump for joy. But investors need to understand that just like regular stock splits, reverse stock splits don't do anything to the intrinsic value of the company or the total value of your shares.
In this case, the reverse split will mean that Aurora shareholders will own far fewer shares of a higher-priced stock. For instance, someone who owns 1,200 shares of Aurora before the reverse split at $0.70 per share has holdings worth $840. After the reverse split, that shareholder will have 12 times less stock -- just 100 shares. If the market price goes to $8.40 per share as expected, then the move won't have any effect on the $840 value of that investor's Aurora holdings.
Will a reverse split work for Aurora?
The track record for companies doing reverse stock splits isn't too great. More often than not, the move simply allows the company's shares to keep trading on the NYSE or other stock exchanges. Without improvement in business fundamentals, the stock price often keeps falling. Indeed, one reason why Aurora might have chosen 1-for-12 as its ratio is in anticipation of giving itself some breathing room if shares keep dropping after the reverse split takes place.
Outside the cannabis industry, there have been some success stories with reverse splits. Yet even then, the stock tends not to return to its former highs, instead trading in a range more consistent with the new conditions.
One example is American International Group (NYSE: AIG), which suffered dramatic dilution during the financial crisis. Following a 2009 reverse split, the insurance giant's stock stabilized and subsequently tripled from its financial crisis lows. However, it remains far below its split-adjusted highs of almost $2,000 per share in its heyday.
Aurora recently signaled another reason for the reverse split: its hope to raise more capital. In expanding its shelf offering registration, Aurora will be able to sell more stock to investors in secondary offerings if it wants to do so. The pot stock has a history of past dilutive offerings, and they've accelerated the descent in its share price over time.
Don't get tricked
So if you're surprised to see Aurora's stock price soar sometime next month, don't be. Investors will find out soon enough that they have a lot fewer shares in their portfolios -- and it'll still take a lot of work for Aurora to pull out of its tailspin and start realizing its full potential as a giant in the cannabis industry.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Dan Caplinger owns shares of American International Group. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Aurora Cannabis (NYSE: ACB) has seen its share price fall more than 80% in just the past six months, underperforming even companies like Tilray (NASDAQ: TLRY) and Canopy Growth (NYSE: CGC) in their recent struggles. After a year's worth of disappointing numbers following the opening of the Canadian market to recreational marijuana sales, many cannabis companies are struggling from the financial effects of the coronavirus pandemic. Indeed, one reason why Aurora might have chosen 1-for-12 as its ratio is in anticipation of giving itself some breathing room if shares keep dropping after the reverse split takes place. | Aurora Cannabis (NYSE: ACB) has seen its share price fall more than 80% in just the past six months, underperforming even companies like Tilray (NASDAQ: TLRY) and Canopy Growth (NYSE: CGC) in their recent struggles. After a year's worth of disappointing numbers following the opening of the Canadian market to recreational marijuana sales, many cannabis companies are struggling from the financial effects of the coronavirus pandemic. With the price around $0.70 per share recently, the reverse split should send Aurora's stock price soaring to around $8.40 per share. | Aurora Cannabis (NYSE: ACB) has seen its share price fall more than 80% in just the past six months, underperforming even companies like Tilray (NASDAQ: TLRY) and Canopy Growth (NYSE: CGC) in their recent struggles. Stock prices below $1 per share are problematic because they endanger a company's ability to keep its stock listed on major exchanges like the New York Stock Exchange. With the price around $0.70 per share recently, the reverse split should send Aurora's stock price soaring to around $8.40 per share. | Aurora Cannabis (NYSE: ACB) has seen its share price fall more than 80% in just the past six months, underperforming even companies like Tilray (NASDAQ: TLRY) and Canopy Growth (NYSE: CGC) in their recent struggles. With the price around $0.70 per share recently, the reverse split should send Aurora's stock price soaring to around $8.40 per share. After the reverse split, that shareholder will have 12 times less stock -- just 100 shares. |
37559.0 | 2020-04-16 00:00:00 UTC | Aurora Cannabis (ACB): Not All Reverse Splits Are Negative | ACB | https://www.nasdaq.com/articles/aurora-cannabis-acb%3A-not-all-reverse-splits-are-negative-2020-04-16 | nan | nan | Aurora Cannabis (ACB) is taking another hit as the company proposes a reverse split to satisfy NYSE listing requirements. Such moves to boost the stock price are typically signs of companies in distress, but the move doesn’t alter the financial position of Aurora. The company is still participating in 2020 growth catalysts while the stock will remain volatile during this period.
Reverse Stock Split Details
The Board of Directors has proposed that Aurora Cannabis complete a 1-for-12 reverse stock split. The company now lists 1,313,494,990 common shares outstanding leading to a post-split share count of 109,457,915 shares.
The company forecasts the reverse split to take place around a month from now on May 11. Aurora Cannabis has an ongoing at-the-market equity plan suggesting additional shares will be sold to raise cash over the next month leading to a higher share count when the split is complete.
The key to the reverse split is the stock has a market valuation below $1 billion before and after the split with the share price at $0.71 here. Aurora Cannabis would trade near $9 following the split without any further stock changes.
Typically, stocks trade down after a split as the higher share price makes the stock appealing to short sellers again. Aurora Cannabis suggests FQ3 results were on plan for small sequential growth and the company remains on path to reach business transformation goals of reducing quarterly operating expenses to C$45 million. The ability to hit revenue targets while cutting costs is a major positive going forward.
Rite Aid Example
The majority of reverse splits end up negative for existing shareholders as the move does nothing to improve the fundamentals of the business that pushed the stock so low to require a split. Rite Aid (RAD) is a prime example of a company that thrived after a reverse split providing some hope for Aurora Cannabis shareholders.
The pharmacy chain announced a 1-for-20 reverse split back over one year ago in January. At the time, Rite Aid was a penny stock similar to Aurora Cannabis.
After the split, the stock traded around $10 and eventually hit a low of $5. By the end of 2019, Rite Aid soared to over $20 and currently trades above the split levels near $15.
If anything, Rite Aid is a weak third player in the pharmacy space while Aurora Cannabis remains a top player in the Canadian cannabis market and the push into global operations. The cannabis company made several mistakes along the path to this point of needing a reverse stock split to meet NYSE minimum requirements of $1, but Aurora Cannabis appears in a far better competitive position here.
Takeaway
The key investor takeaway is that the valuation equation for Aurora Cannabis isn’t impacted by a reverse stock split. The stock will trade volatile over this next few months, but any investors liking the stock prior to the split should like Aurora Cannabis on any dips now.
The key to the story remains whether the company can turn current sales levels into a profitable business. The preliminary March quarter results suggest Aurora Cannabis is on the right path just in time for more retail stores in Ontario when the Covid-19 pandemic wanes.
All in all, Wall Street isn’t jumping for joy — but isn’t sounding the alarms, either. TipRanks analysis of 15 analyst ratings shows a consensus Hold rating, with one analyst suggesting Buy, 11 saying Hold and 3 recommending Sell. The average price target among these analysts stands at US$1.69, which implies 138.5% upside from current levels. (See Aurora Cannabis stock analysis on TipRanks)
To find good ideas for cannabis stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Aurora Cannabis (ACB) is taking another hit as the company proposes a reverse split to satisfy NYSE listing requirements. Aurora Cannabis suggests FQ3 results were on plan for small sequential growth and the company remains on path to reach business transformation goals of reducing quarterly operating expenses to C$45 million. Rite Aid (RAD) is a prime example of a company that thrived after a reverse split providing some hope for Aurora Cannabis shareholders. | Aurora Cannabis (ACB) is taking another hit as the company proposes a reverse split to satisfy NYSE listing requirements. Reverse Stock Split Details The Board of Directors has proposed that Aurora Cannabis complete a 1-for-12 reverse stock split. Aurora Cannabis suggests FQ3 results were on plan for small sequential growth and the company remains on path to reach business transformation goals of reducing quarterly operating expenses to C$45 million. | Aurora Cannabis (ACB) is taking another hit as the company proposes a reverse split to satisfy NYSE listing requirements. Reverse Stock Split Details The Board of Directors has proposed that Aurora Cannabis complete a 1-for-12 reverse stock split. The cannabis company made several mistakes along the path to this point of needing a reverse stock split to meet NYSE minimum requirements of $1, but Aurora Cannabis appears in a far better competitive position here. | Aurora Cannabis (ACB) is taking another hit as the company proposes a reverse split to satisfy NYSE listing requirements. Aurora Cannabis would trade near $9 following the split without any further stock changes. After the split, the stock traded around $10 and eventually hit a low of $5. |
37560.0 | 2020-04-16 00:00:00 UTC | Aurora Cannabis Just Gave Investors 350 Million Reasons to Avoid It Like the Plague | ACB | https://www.nasdaq.com/articles/aurora-cannabis-just-gave-investors-350-million-reasons-to-avoid-it-like-the-plague-2020 | nan | nan | If you think restaurants or oil stocks have had it bad lately, you haven't been paying attention to marijuana stocks, which have fallen off of a veritable cliff since the end of March 2019.
Although the long-term outlook for the cannabis industry remains promising -- after all, tens of billions of dollars in weed sales are conducted in the black market each year -- the near-term outlook isn't so hot. Regulatory issues in Canada at the national and provincial level have created everything from product shortage to sizable supply bottlenecks, depending on the region. Meanwhile, high tax rates have made it difficult for legal producers in the U.S. to compete with illicit growers. And as the icing on the cake, North American | Although the long-term outlook for the cannabis industry remains promising -- after all, tens of billions of dollars in weed sales are conducted in the black market each year -- the near-term outlook isn't so hot. Regulatory issues in Canada at the national and provincial level have created everything from product shortage to sizable supply bottlenecks, depending on the region. Meanwhile, high tax rates have made it difficult for legal producers in the U.S. to compete with illicit growers. | If you think restaurants or oil stocks have had it bad lately, you haven't been paying attention to marijuana stocks, which have fallen off of a veritable cliff since the end of March 2019. Although the long-term outlook for the cannabis industry remains promising -- after all, tens of billions of dollars in weed sales are conducted in the black market each year -- the near-term outlook isn't so hot. Regulatory issues in Canada at the national and provincial level have created everything from product shortage to sizable supply bottlenecks, depending on the region. | Although the long-term outlook for the cannabis industry remains promising -- after all, tens of billions of dollars in weed sales are conducted in the black market each year -- the near-term outlook isn't so hot. Regulatory issues in Canada at the national and provincial level have created everything from product shortage to sizable supply bottlenecks, depending on the region. Meanwhile, high tax rates have made it difficult for legal producers in the U.S. to compete with illicit growers. | If you think restaurants or oil stocks have had it bad lately, you haven't been paying attention to marijuana stocks, which have fallen off of a veritable cliff since the end of March 2019. Although the long-term outlook for the cannabis industry remains promising -- after all, tens of billions of dollars in weed sales are conducted in the black market each year -- the near-term outlook isn't so hot. Regulatory issues in Canada at the national and provincial level have created everything from product shortage to sizable supply bottlenecks, depending on the region. |
37561.0 | 2020-04-15 00:00:00 UTC | Pandemic Pot Purchases Will Bolster Aurora Stock | ACB | https://www.nasdaq.com/articles/pandemic-pot-purchases-will-bolster-aurora-stock-2020-04-15 | nan | nan | InvestorPlace - Stock Market News, Stock Advice & Trading Tips
Few commentators are willing to defend Aurora Cannabis (NYSE:ACB) now. Over the past year, Aurora stock has steadily declined from $9 to under $1. And catching a proverbial falling knife is a dangerous game to play.
Source: Jarretera / Shutterstock.com
There’s a thesis, though, that the market has excessively punished Aurora stockholders. With a trailing 12-month price-to-earnings ratio of 4.06, this stock is cheap on a relative basis. Or are the shares just dead money? A broader look at the cannabis market could yield some clues.
A Recession Boost for Cannabis
While financial experts are busy talking about how the novel coronavirus has impacted the cruise-ship, airline and ride-share markets, investors shouldn’t ignore how it has affected the cannabis industry. Common sense might tell us that the net impact would be negative.
However, common sense can lead us astray sometimes. Sure, the prevalent stay-at-home mandates have caused some dispensaries to shut down. But in anticipation of this, consumers have flocked to the remaining open cannabis stores to stock up on weed.
7 Media Stocks That Will Power Higher After the Pandemic Subsides
Canada is often considered the pot capital of the world, and in Nova Scotia, cannabis sales increased by 76% in just one week. A number of Canadian provinces, including Quebec and Ontario, have declared cannabis stores “essential.” That’s pretty mind-blowing considering marijuana was illegal in the not-too-distant past.
As for Aurora, the company has been perfectly positioned for a situation like this. In fact, Aurora had 216 million CAD worth of cannabis inventory on their books prior to the sudden demand boost. This could be enough pot to meet a year’s worth of demand.
Cannabis at Your Doorstep
We’ve only discussed in-store pot sales so far, but that’s only a piece of the overall picture. As you probably are well aware, doorstep delivery has become a way of life as more cities institute stay-at-home mandates.
This means that businesses have had to shift their product-delivery strategies, while some local governments have relaxed their cannabis-related rules. For instance, Illinois has permitted the curbside pickup of cannabis-product orders during the coronavirus crisis. Nevada, moreover, is having its licensees deliver cannabis.
States don’t want to lose the tax revenues they receive from cannabis sales. Therefore, rather than lose this “economic stimulus,” it’s conceivable that more states will allow cannabis delivery. Many bored stay-at-homers would undoubtedly welcome such deliveries, both for their medicinal and their recreational benefits.
Not to suggest that the industry’s oversupply issues are completely solved, but the demand spike is well-timed. It’s also encouraging that Aurora is implementing a cost-reduction program. This proactive move could bring Aurora’s quarterly operating expenses under 45 million CAD.
The ability to produce high-quality cannabis in large quantities is key to Aurora’s success during this pivotal time. Aurora’s press release for 2020’s second fiscal quarter suggests that the company remains productive and ready to meet the demand: “Production volume in fiscal Q2 was 30,691 kilograms, in-line with previous expectations as Aurora realigned its cultivation strategy to produce a greater amount of higher value and higher potency strains.”
The Takeaway on Aurora Stock
The trading community really beat up on Aurora stock over the past year. It seems excessive and that could present a chance to buy shares at a steep discount. Stay-at-home orders might actually prove to be the catalyst that resurrects Aurora and the cannabis market as a whole.
David Moadel has provided compelling content – and crossed the occasional line – on behalf of Crush the Street, Market Realist, TalkMarkets, Finom Group, Benzinga, and (of course) InvestorPlace.com. He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets. As of this writing, he did not hold a position in any of the aforementioned securities.
The post Pandemic Pot Purchases Will Bolster Aurora Stock appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips Few commentators are willing to defend Aurora Cannabis (NYSE:ACB) now. 7 Media Stocks That Will Power Higher After the Pandemic Subsides Canada is often considered the pot capital of the world, and in Nova Scotia, cannabis sales increased by 76% in just one week. A number of Canadian provinces, including Quebec and Ontario, have declared cannabis stores “essential.” That’s pretty mind-blowing considering marijuana was illegal in the not-too-distant past. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips Few commentators are willing to defend Aurora Cannabis (NYSE:ACB) now. Over the past year, Aurora stock has steadily declined from $9 to under $1. Aurora’s press release for 2020’s second fiscal quarter suggests that the company remains productive and ready to meet the demand: “Production volume in fiscal Q2 was 30,691 kilograms, in-line with previous expectations as Aurora realigned its cultivation strategy to produce a greater amount of higher value and higher potency strains.” The Takeaway on Aurora Stock The trading community really beat up on Aurora stock over the past year. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips Few commentators are willing to defend Aurora Cannabis (NYSE:ACB) now. A Recession Boost for Cannabis While financial experts are busy talking about how the novel coronavirus has impacted the cruise-ship, airline and ride-share markets, investors shouldn’t ignore how it has affected the cannabis industry. Aurora’s press release for 2020’s second fiscal quarter suggests that the company remains productive and ready to meet the demand: “Production volume in fiscal Q2 was 30,691 kilograms, in-line with previous expectations as Aurora realigned its cultivation strategy to produce a greater amount of higher value and higher potency strains.” The Takeaway on Aurora Stock The trading community really beat up on Aurora stock over the past year. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips Few commentators are willing to defend Aurora Cannabis (NYSE:ACB) now. This could be enough pot to meet a year’s worth of demand. Cannabis at Your Doorstep We’ve only discussed in-store pot sales so far, but that’s only a piece of the overall picture. |
37562.0 | 2020-04-15 00:00:00 UTC | Aurora Stock Needed to Reverse Split, But It’s Still Not a Buy | ACB | https://www.nasdaq.com/articles/aurora-stock-needed-to-reverse-split-but-its-still-not-a-buy-2020-04-15 | nan | nan | InvestorPlace - Stock Market News, Stock Advice & Trading Tips
Aurora Cannabis (NYSE:ACB) shares tumbled 13.3% on Monday, April 13. That’s after the company announced a 1-for-12 reverse split. With Aurora stock trading below $1, the company had little choice but to engineer the move.
Source: Shutterstock
To be fair, sometimes reverse splits do generate positive reactions once complete. At one point, Citigroup (NYSE:C) had to reverse split its stock to get it out of the doldrums. While the company has done better lately though, it still lags many of its peers in terms of performance and valuation.
However, plenty of other stocks have engineered the move with little to no success. Will Aurora stock be one of those, or will they pull a Citigroup and gain traction? There’s no way to know with a large degree of certainty, but it’s not the cannabis name we want to bet on.
Aurora Stock Splits
Companies have to maintain certain requirements to remain on the stock exchanges where they are listed. The New York Stock Exchange, which is where Aurora stock is listed, does not want a bunch of penny stocks on its board. When stocks fall below $1, they face the potential to be delisted.
7 Bank Stocks to Watch as Earnings Season Heats Up
As a result, Aurora management plans to reverse split the stock, offering 1 share for every 12 shares of stock investors own. Obviously that does not equate to a 12-fold return when the share price balloons higher. It’s a simple sleight-of-hand, altering the share count to elevate the stock price. It’s the same when companies want a lower stock price — like Apple (NASDAQ:AAPL) or Starbucks (NASDAQ:SBUX) — and split their stocks.
It’s not unethical, but it does nothing to change the realities at Aurora.
Will Aurora Stay Afloat?
In addition to the reverse stock split, the company said it plans to raise more capital. That’s even with 205 million CAD sitting on its balance sheet as of the most recent quarter. Further, management says that the company’s facilities continue to operate and that it remains on track with its business transformation announcement.
A lot has happened since we last heard from management on Feb. 13. That’s when Aurora announced its fiscal second-quarter results, missing on revenue estimates and reporting an adjusted EBITDA loss of 80.2 million CAD.
That release came just days after the company announced a 17% to 18% reduction in its workforce, while its CEO stepped down as well. Management also slashed its revenue outlook and took a number of impairment charges.
It’s true that Aurora stock needed change at the top, and its Canadian operations are running more smoothly than its international expansion efforts. While the industry as a whole has an optimistic future, there are simply too many red flags here.
While the cannabis group has struggled over the past year or so, Aurora has looked lost at sea. There’s a reason the stock is down 91% over the past 12 months and 67% year to date. The outbreak of the novel coronavirus certainly doesn’t help the stock price, but this company’s issues began long before the global pandemic.
Simply put, its financials are not in strong enough standing to convince us to bet on this horse. Sales are struggling, losses are mounting, and the balance sheet does not suggest robust staying power. For those reasons, we are avoiding Aurora stock, even below $1.
Click to Enlarge
Source: Chart courtesy of Statista, Source from SAMHSA; RTI International
Bottom Line on ACB Stock
The cannabis space is enjoying deregulation around the world. Companies, startups and medical teams are studying the various effects and increasing uses for cannabis and cannabinoid-related products. The industry is moving forward at a pace it has never seen.
But that doesn’t mean every company will succeed. Perhaps Aurora stock will do just that — defying the odds, raising capital and reverse-splitting its way to success. Right now though, ACB presents too much risk.
While other stocks in the group have been beaten down too, we feel more comfortable in a stock like Canopy Growth (NYSE:CGC). It has a stronger balance sheet, a strong partner in Constellation Brands (NYSE:STZ), and stands on stronger ground at the moment.
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The post Aurora Stock Needed to Reverse Split, But It’s Still Not a Buy appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips Aurora Cannabis (NYSE:ACB) shares tumbled 13.3% on Monday, April 13. Click to Enlarge Source: Chart courtesy of Statista, Source from SAMHSA; RTI International Bottom Line on ACB Stock The cannabis space is enjoying deregulation around the world. Right now though, ACB presents too much risk. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips Aurora Cannabis (NYSE:ACB) shares tumbled 13.3% on Monday, April 13. Click to Enlarge Source: Chart courtesy of Statista, Source from SAMHSA; RTI International Bottom Line on ACB Stock The cannabis space is enjoying deregulation around the world. Right now though, ACB presents too much risk. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips Aurora Cannabis (NYSE:ACB) shares tumbled 13.3% on Monday, April 13. Click to Enlarge Source: Chart courtesy of Statista, Source from SAMHSA; RTI International Bottom Line on ACB Stock The cannabis space is enjoying deregulation around the world. Right now though, ACB presents too much risk. | InvestorPlace - Stock Market News, Stock Advice & Trading Tips Aurora Cannabis (NYSE:ACB) shares tumbled 13.3% on Monday, April 13. Click to Enlarge Source: Chart courtesy of Statista, Source from SAMHSA; RTI International Bottom Line on ACB Stock The cannabis space is enjoying deregulation around the world. Right now though, ACB presents too much risk. |
37563.0 | 2020-04-14 00:00:00 UTC | Is Aphria Stock a Buy? | ACB | https://www.nasdaq.com/articles/is-aphria-stock-a-buy-2020-04-14 | nan | nan | The cannabis industry hasn't escaped the recent market sell-off. The industry as a whole, as measured by the Horizons Marijuana Life Sciences ETF, is down by 30% year-to-date. Aphria (NYSE: APHA), one of the largest cannabis companies by market cap, has performed slightly worse: Its shares are down by about 30.8% since the beginning of the year.
However, the Ontario-based pot grower is now much more attractively valued than it was just a few months ago. At writing, Aphria is trading at only 2.5 times forward sales, which is a bargain when compared to many of its peers in the cannabis industry. For instance, Canopy Growth (NYSE: CGC) is currently trading at more than 10 times forward sales. Does Aphria's comparatively attractive valuation make the company a buy?
How will the ongoing pandemic affect Aphria?
Aphria is one of the few cannabis companies that has managed to sign supply agreements with every Canadian province. Also, the company's projected peak production capacity is about 255,000 kilograms, making Aphria one of the leaders in this category in the Canadian pot market. Thanks to these factors, Aphria is well-positioned to profit from the cannabis market. In particular, the company is planning to take advantage of the market for derivative products, which officially opened in Canada on Oct. 17.
Image Source: Getty Images.
During Aphria's first-quarterearnings conference call Carl Merton, who at the time was the company's interim CEO (and is currently serving as Aphria's CFO), said, "Our internal models are really based around 60% market share for dried cannabis, 20% to 30% for vapes, and the remainder being split between drinks, edibles, and the other new product formats."
However, the ongoing COVID-19 outbreak is forcing people to stay indoors and reducing foot traffic in physical stores, including legally licensed retail cannabis stores where Aphria's products are sold. In the province of Ontario, which is where Aphria is based, the government has cracked down on business closures and has opted to allow only "essential businesses" to remain open. The government of Ontario initially deemed cannabis stores essential businesses, only to remove them from that list about a week and a half later.
Fortunately, the government eventually reversed course and decided to allow pot stores to reopen for pickup and delivery services. This new verdict is set to last only 14 days, but it could be extended. It is also worth noting that sales of cannabis products have been booming during the pandemic, which means Aphria and its peers in the pot market may not suffer deep financial losses as a result of the outbreak.
Recent financial results
Aphria has recorded strong financial results of late, at least compared to most other companies in the cannabis industry. The following table compares some of Aphria's key financial metrics for its latest reported quarter -- the second quarter of its fiscal year 2020 -- with that of two of its biggest competitors, namely Canopy Growth and Aurora Cannabis (NYSE: ACB).
COMPANY
MARKET CAP
NET REVENUE
OPERATING LOSS
NET LOSS
CASH AND EQUIVALENTS
Aphria
$852.6 million
$120.6 million
$9.6 million
$7.9 million
$497.7 million
Canopy Growth
$5.1 billion
$123.8 million
$171.5 million
$124.2 million
$1.6 billion
Aurora Cannabis
$1 billion
$56 million
$119.6 million
$1.3 billion
$156.3 million
All Figures in Canadian Dollars. Source: Company Financial Statements.
Canopy recorded a net revenue slightly above that of Aphria and also has far more cash on hand. However, Canopy also posted much deeper operating and net losses. Aphria's metrics compare very favorably to that of Aurora Cannabis across the board. Also, Aphria has been the most consistent of the three over the past few quarters in terms of their respective financial results. And given the company's attractive valuation, Aphria may well be the better choice of the three.
Should you buy Aphira?
Aphria's stock will likely continue to be volatile moving forward, as will much of the cannabis industry. And although Aphria has recorded decent financial results of late, I think its stock remains on the risky side, and only those investors comfortable with a little risk should consider opening a position in Aphria.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The following table compares some of Aphria's key financial metrics for its latest reported quarter -- the second quarter of its fiscal year 2020 -- with that of two of its biggest competitors, namely Canopy Growth and Aurora Cannabis (NYSE: ACB). Aphria (NYSE: APHA), one of the largest cannabis companies by market cap, has performed slightly worse: Its shares are down by about 30.8% since the beginning of the year. Also, the company's projected peak production capacity is about 255,000 kilograms, making Aphria one of the leaders in this category in the Canadian pot market. | The following table compares some of Aphria's key financial metrics for its latest reported quarter -- the second quarter of its fiscal year 2020 -- with that of two of its biggest competitors, namely Canopy Growth and Aurora Cannabis (NYSE: ACB). Does Aphria's comparatively attractive valuation make the company a buy? Recent financial results Aphria has recorded strong financial results of late, at least compared to most other companies in the cannabis industry. | The following table compares some of Aphria's key financial metrics for its latest reported quarter -- the second quarter of its fiscal year 2020 -- with that of two of its biggest competitors, namely Canopy Growth and Aurora Cannabis (NYSE: ACB). During Aphria's first-quarterearnings conference call Carl Merton, who at the time was the company's interim CEO (and is currently serving as Aphria's CFO), said, "Our internal models are really based around 60% market share for dried cannabis, 20% to 30% for vapes, and the remainder being split between drinks, edibles, and the other new product formats." Recent financial results Aphria has recorded strong financial results of late, at least compared to most other companies in the cannabis industry. | The following table compares some of Aphria's key financial metrics for its latest reported quarter -- the second quarter of its fiscal year 2020 -- with that of two of its biggest competitors, namely Canopy Growth and Aurora Cannabis (NYSE: ACB). Does Aphria's comparatively attractive valuation make the company a buy? Recent financial results Aphria has recorded strong financial results of late, at least compared to most other companies in the cannabis industry. |
37564.0 | 2020-04-14 00:00:00 UTC | TSX climbs on upbeat China data, signs of easing lockdowns | ACB | https://www.nasdaq.com/articles/tsx-climbs-on-upbeat-china-data-signs-of-easing-lockdowns-2020-04-14 | nan | nan | April 14 (Reuters) - Canada's main stock index rose on Tuesday as sentiment was helped by better-than-expected trade data from China and signs that some economies were preparing to ease lockdowns after coronavirus cases seemed to plateau.
Data from China showed exports and imports shrank less than expected in March as factories restarted production, but analysts warned a sure-footed recovery was months away.
In the United States, President Donald Trump said his administration was close to completing a plan to re-open the economy, while in Spain some businesses reopened, although shops, bars and public spaces were set to stay closed until at least April 26. MKTS/GLOB
* At 09:41 a.m. ET (13:41 GMT), the Toronto Stock Exchange's S&P/TSX composite index .GSPTSE was up 273.5 points, or 1.94%, at 14,349.44.
* The materials sector .GSPTTMT, which includes precious and base metals miners and fertilizer companies, rose 2.6% helped by higher gold prices. GOL/MET/L
* Gold prices hit their highest level in more than seven years on Tuesday as concerns over global economic growth and a wave of stimulus measures from central banks and governments lifted bullion's appeal. GOL/
* The largest percentage gainer on the TSX was Torex Gold Resources TXG.TO, which jumped 9.3%, and MAG Silver Corp MAG.TO followed with a 6.9% rise.
* Baytex Energy Co BTE.TO fell 3.8%, the most on the TSX, and the second biggest decliner was Enerflex Ltd EFX.TO, down 2.7%, after Scotiabank cut its price target on stock.
* On the TSX, 206 issues were higher, while 24 issues declined for a 8.58-to-1 ratio favouring gainers, with 29.92 million shares traded.
* The most heavily traded shares by volume were Toronto Dominion Bank TD.TO, B2gold Corp BTO.TO and Aurora Cannabis ACB.TO.
* The TSX posted seven new 52-week highs and no new low.
* Across all Canadian issues there were 16 new 52-week highs and one new low, with total volume of 53.34 million shares.
(Reporting by Susan Mathew in Bengaluru; Editing by Amy Caren Daniel)
((susan.mathew@thomsonreuters.com; +91-80-6287-2704;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | * The most heavily traded shares by volume were Toronto Dominion Bank TD.TO, B2gold Corp BTO.TO and Aurora Cannabis ACB.TO. April 14 (Reuters) - Canada's main stock index rose on Tuesday as sentiment was helped by better-than-expected trade data from China and signs that some economies were preparing to ease lockdowns after coronavirus cases seemed to plateau. Data from China showed exports and imports shrank less than expected in March as factories restarted production, but analysts warned a sure-footed recovery was months away. | * The most heavily traded shares by volume were Toronto Dominion Bank TD.TO, B2gold Corp BTO.TO and Aurora Cannabis ACB.TO. April 14 (Reuters) - Canada's main stock index rose on Tuesday as sentiment was helped by better-than-expected trade data from China and signs that some economies were preparing to ease lockdowns after coronavirus cases seemed to plateau. * The materials sector .GSPTTMT, which includes precious and base metals miners and fertilizer companies, rose 2.6% helped by higher gold prices. | * The most heavily traded shares by volume were Toronto Dominion Bank TD.TO, B2gold Corp BTO.TO and Aurora Cannabis ACB.TO. April 14 (Reuters) - Canada's main stock index rose on Tuesday as sentiment was helped by better-than-expected trade data from China and signs that some economies were preparing to ease lockdowns after coronavirus cases seemed to plateau. GOL/MET/L * Gold prices hit their highest level in more than seven years on Tuesday as concerns over global economic growth and a wave of stimulus measures from central banks and governments lifted bullion's appeal. | * The most heavily traded shares by volume were Toronto Dominion Bank TD.TO, B2gold Corp BTO.TO and Aurora Cannabis ACB.TO. April 14 (Reuters) - Canada's main stock index rose on Tuesday as sentiment was helped by better-than-expected trade data from China and signs that some economies were preparing to ease lockdowns after coronavirus cases seemed to plateau. * On the TSX, 206 issues were higher, while 24 issues declined for a 8.58-to-1 ratio favouring gainers, with 29.92 million shares traded. |
37565.0 | 2020-04-13 00:00:00 UTC | BUZZ-U.S. STOCKS ON THE MOVE-Netflix, Amazon.com, Dish Network, GE, AMC Entertainment, Aurora Cannabis | ACB | https://www.nasdaq.com/articles/buzz-u.s.-stocks-on-the-move-netflix-amazon.com-dish-network-ge-amc-entertainment-aurora | nan | nan | Eikon search string for individual stock moves: STXBZ
The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi
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U.S. stock markets slipped in subdued trading on Monday after a strong rally last week, as corporate America launches into what is expected to be a painful quarterly earnings season due to the coronavirus pandemic. .N
At 01:08 pm ET, the Dow Jones Industrial Average .DJI was down 2.14% at 23,212.28. The S&P 500 .SPX was down 1.76% at 2,740.79 and the Nasdaq Composite .IXIC was down 0.75% at 8,092.516. The top three S&P 500 .PG.INX percentage gainers: ** Netflix Inc , up 5.9% ** National Oilwell Varco Inc , up 5.3% ** Newmont Corp , up 5% The top three S&P 500 .PL.INX percentage losers: ** Royal Caribbean Cruises Ltd , down 14.3% ** Norwegian Cruise Line Holdings Ltd , down 13.1% ** Alliance Data Systems Corp , down 10.3% The top three NYSE .PG.N percentage gainers: ** Independence Contract Drilling Inc , up 60.8% ** Manning & Napier Inc , up 51.4% ** Can Fite Biofarma Ltd , up 40.8% The top two NYSE .PL.N percentage losers: ** IQ US Real Estate Small Cap ETF , down 23.4% ** AMC Entertainment Holdings Inc , down 20% The top three Nasdaq .PG.O percentage gainers: ** Scworx Corp , up 508.4% ** Borqs Technologies Inc , up 372% ** NN Inc, up 67.1% The top three Nasdaq .PL.O percentage losers: ** Sabre Corp , down 20.1% ** Mid-Con Energy Partners LP , down 16.2% ** Sotherly Hotels Inc , down 15.7% ** Ford Motor Co F.N: down 5.5%
BUZZ-Falls as co projects Q1 loss of about $600 mln ** Dish Network Corp DISH.O: down 5.8%
BUZZ- Falls as co cuts jobs, re-evaluates business ** Aurora Cannabis ACB.N: down 14.9% ** Tilray Inc TLRY.O: down 8.7%
BUZZ-Falls on capital raise plans, reverse stock split ** Amazon.com Inc AMZN.O: up 4.7% ** Netflix NFLX.O: up 5.9% BUZZ-With millions stuck at home, Canaccord raises PT on Netflix, Amazon
BUZZ-Amazon rises on plans to hire 75,000 workers amid coronavirus spread ** FedEx Corp FDX.N: up 0.5%
BUZZ-FedEx rises as BofA upgrades to "buy" on Amazon shipping pause ** NXP Semiconductors NV NXPI.O: down 1.8%
BUZZ-Evercore downgrades on falling demand from automotive sector ** AMC Entertainment Holdings Inc AMC.N: down 20.0%
BUZZ-AMC tumbles 20% after unconfirmed report it may hire bankruptcy law firm ** General Electric Co GE.N: down 3.9%
BUZZ-Falls after refinancing debt
** Carnival Corp CCL.N: down 7.2% ** Royal Caribbean Cruises Ltd RCL.N: down 14.3% ** Norwegian Cruise Line Holdings Ltd NCLH.N: down 13.1%
BUZZ-Cruise operators dip after CDC extends "no sail" order ** BioCryst Pharmaceuticals Inc BCRX.O: up 13.3%
BUZZ-Surges on beginning trial for potential COVID-19 treatment ** Boston Scientific Corp BSX.N: down 5.5%
BUZZ-JPM cuts PT on bumpy near-term ** Biocept Inc BIOC.O: up 65.0%
BUZZ-Up on plan to begin testing services for COVID-19 ** Gilead Sciencs Inc GILD.O: up 1.4%
BUZZ-Street View: Gilead's coronavirus drug data leaves Wall St cautiously optimistic
** Alibaba Group Holding Ltd BABA.N: up 0.9%
Buzz-KeyBanc raises PT on China recovery ** Athersys Inc ATHX.O: up 16.8%
BUZZ-Jumps after FDA clears cell therapy trial in COVID-19 patients ** Yelp Inc YELP.N: down 4.1%
BUZZ-J.P.Morgan cuts PT, earnings estimate on coronavirus impact ** Pluristem Therapeutics Inc PSTI.O: up 15.4%
BUZZ-Pluristem jumps after its therapy treats 1st U.S. patient with COVID-19 complications ** Dropbox Inc DBX.O: up 2.4% BUZZ-Jefferies highlights work from home winners & losers ** Digital Realty Trust Inc DLR.N: down 4.1%
BUZZ-Baird cuts data center REIT Digital Realty to "neutral" on valuation ** Zimmer Biomet Holdings Inc ZBH.N: down 3.8%
BUZZ-Credit Suisse cuts PTs for MedTech as coronavirus slows elective surgeries ** CytoSorbents Corp CTSO.O: up 21.2%
BUZZ- Up as FDA approves therapy for emergency use in COVID-19 patients ** Caterpillar Inc CAT.N: down 8.6%
BUZZ-Caterpillar falls on BofA downgrade ** Quintana Energy Services Inc QES.N: down 21.0%
BUZZ-Crashes on dismal industry outlook, furlough plans ** Qualstar Corp QBAK.O: down 19.1%
BUZZ-Down on plans to delist from Nasdaq ** Johnson & Johnson JNJ.N: down 2.0%
BUZZ-Credit Suisse cuts PT on coronavirus impact on surgeries
BUZZ-PREVIEW: J&J set for Q1, med devices seen taking elective procedure hit ** Burlington Stores Inc BURL.N: down 6.0%
BUZZ-Burlington Stores falls as co launches $1 bln capital raise, furloughs most staff ** Alimera Sciences Inc ALIM.O: up 14.7%
BUZZ-Jumps after forecasting Q1 revenue ahead of estimates ** Natera Inc NTRA.O: down 9.4%
BUZZ-Slips after withdrawing 2020 forecast ** Macy's Inc M.N: down 7.6%
BUZZ-Macy's down on report of hiring Lazard for finance boosting options ** EBay Inc EBAY.O: up 2.4%
BUZZ-Rises after CEO appointment ** JPMorgan Chase & Co JPM.N: down 4.0%
BUZZ-PREVIEW: JPMorgan shares tumble amid expectations for dim Q1 results ** Enzo Biochem Inc ENZ.N: down 10.7%
BUZZ-Drops as co's lab-testing volumes fall due to COVID-19 ** Borqs Technologies Inc BRQS.O: up 372.0%
BUZZ-Borqs set for best day ever after receiving $150 mln line of credit ** Zoetis Inc ZTS.N: down 4.6%
BUZZ-Guggenheim optimistic about animal health firms The 11 major S&P 500 sectors:
Communication Services
.SPLRCL
down 1.26%
Consumer Discretionary
.SPLRCD
up 0.01%
Consumer Staples
.SPLRCS
down 1.40%
Energy
.SPNY
down 0.65%
Financial
.SPSY
down 3.63%
Health
.SPXHC
down 1.94%
Industrial
.SPLRCI
down 3.40%
Information Technology
.SPLRCT
down 1.25%
Materials
.SPLRCM
down 2.69%
Real Estate
.SPLRCR
down 4.47%
Utilities
.SPLRCU
down 2.99%
(Compiled by Shradha Singh in Bengaluru)
((Shradha.Singh@thomsonreuters.com))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The top three S&P 500 .PG.INX percentage gainers: ** Netflix Inc , up 5.9% ** National Oilwell Varco Inc , up 5.3% ** Newmont Corp , up 5% The top three S&P 500 .PL.INX percentage losers: ** Royal Caribbean Cruises Ltd , down 14.3% ** Norwegian Cruise Line Holdings Ltd , down 13.1% ** Alliance Data Systems Corp , down 10.3% The top three NYSE .PG.N percentage gainers: ** Independence Contract Drilling Inc , up 60.8% ** Manning & Napier Inc , up 51.4% ** Can Fite Biofarma Ltd , up 40.8% The top two NYSE .PL.N percentage losers: ** IQ US Real Estate Small Cap ETF , down 23.4% ** AMC Entertainment Holdings Inc , down 20% The top three Nasdaq .PG.O percentage gainers: ** Scworx Corp , up 508.4% ** Borqs Technologies Inc , up 372% ** NN Inc, up 67.1% The top three Nasdaq .PL.O percentage losers: ** Sabre Corp , down 20.1% ** Mid-Con Energy Partners LP , down 16.2% ** Sotherly Hotels Inc , down 15.7% ** Ford Motor Co F.N: down 5.5% BUZZ-Falls as co projects Q1 loss of about $600 mln ** Dish Network Corp DISH.O: down 5.8% BUZZ- Falls as co cuts jobs, re-evaluates business ** Aurora Cannabis ACB.N: down 14.9% ** Tilray Inc TLRY.O: down 8.7% BUZZ-Falls on capital raise plans, reverse stock split ** Amazon.com Inc AMZN.O: up 4.7% ** Netflix NFLX.O: up 5.9% BUZZ-With millions stuck at home, Canaccord raises PT on Netflix, Amazon BUZZ-Amazon rises on plans to hire 75,000 workers amid coronavirus spread ** FedEx Corp FDX.N: up 0.5% BUZZ-FedEx rises as BofA upgrades to "buy" on Amazon shipping pause ** NXP Semiconductors NV NXPI.O: down 1.8% BUZZ-Evercore downgrades on falling demand from automotive sector ** AMC Entertainment Holdings Inc AMC.N: down 20.0% BUZZ-AMC tumbles 20% after unconfirmed report it may hire bankruptcy law firm ** General Electric Co GE.N: down 3.9% BUZZ-Falls after refinancing debt ** Carnival Corp CCL.N: down 7.2% ** Royal Caribbean Cruises Ltd RCL.N: down 14.3% ** Norwegian Cruise Line Holdings Ltd NCLH.N: down 13.1% BUZZ-Cruise operators dip after CDC extends "no sail" order ** BioCryst Pharmaceuticals Inc BCRX.O: up 13.3% BUZZ-Surges on beginning trial for potential COVID-19 treatment ** Boston Scientific Corp BSX.N: down 5.5% BUZZ-JPM cuts PT on bumpy near-term ** Biocept Inc BIOC.O: up 65.0% BUZZ-Up on plan to begin testing services for COVID-19 ** Gilead Sciencs Inc GILD.O: up 1.4% BUZZ-Street View: Gilead's coronavirus drug data leaves Wall St cautiously optimistic ** Alibaba Group Holding Ltd BABA.N: up 0.9% Buzz-KeyBanc raises PT on China recovery ** Athersys Inc ATHX.O: up 16.8% BUZZ-Jumps after FDA clears cell therapy trial in COVID-19 patients ** Yelp Inc YELP.N: down 4.1% BUZZ-J.P.Morgan cuts PT, earnings estimate on coronavirus impact ** Pluristem Therapeutics Inc PSTI.O: up 15.4% BUZZ-Pluristem jumps after its therapy treats 1st U.S. patient with COVID-19 complications ** Dropbox Inc DBX.O: up 2.4% BUZZ-Jefferies highlights work from home winners & losers ** Digital Realty Trust Inc DLR.N: down 4.1% BUZZ-Baird cuts data center REIT Digital Realty to "neutral" on valuation ** Zimmer Biomet Holdings Inc ZBH.N: down 3.8% BUZZ-Credit Suisse cuts PTs for MedTech as coronavirus slows elective surgeries ** CytoSorbents Corp CTSO.O: up 21.2% BUZZ- Up as FDA approves therapy for emergency use in COVID-19 patients ** Caterpillar Inc CAT.N: down 8.6% BUZZ-Caterpillar falls on BofA downgrade ** Quintana Energy Services Inc QES.N: down 21.0% BUZZ-Crashes on dismal industry outlook, furlough plans ** Qualstar Corp QBAK.O: down 19.1% BUZZ-Down on plans to delist from Nasdaq ** Johnson & Johnson JNJ.N: down 2.0% BUZZ-Credit Suisse cuts PT on coronavirus impact on surgeries BUZZ-PREVIEW: J&J set for Q1, med devices seen taking elective procedure hit ** Burlington Stores Inc BURL.N: down 6.0% BUZZ-Burlington Stores falls as co launches $1 bln capital raise, furloughs most staff ** Alimera Sciences Inc ALIM.O: up 14.7% BUZZ-Jumps after forecasting Q1 revenue ahead of estimates ** Natera Inc NTRA.O: down 9.4% BUZZ-Slips after withdrawing 2020 forecast ** Macy's Inc M.N: down 7.6% BUZZ-Macy's down on report of hiring Lazard for finance boosting options ** EBay Inc EBAY.O: up 2.4% BUZZ-Rises after CEO appointment ** JPMorgan Chase & Co JPM.N: down 4.0% BUZZ-PREVIEW: JPMorgan shares tumble amid expectations for dim Q1 results ** Enzo Biochem Inc ENZ.N: down 10.7% BUZZ-Drops as co's lab-testing volumes fall due to COVID-19 ** Borqs Technologies Inc BRQS.O: up 372.0% BUZZ-Borqs set for best day ever after receiving $150 mln line of credit ** Zoetis Inc ZTS.N: down 4.6% BUZZ-Guggenheim optimistic about animal health firms The 11 major S&P 500 sectors: Communication Services Eikon search string for individual stock moves: STXBZ The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh U.S. stock markets slipped in subdued trading on Monday after a strong rally last week, as corporate America launches into what is expected to be a painful quarterly earnings season due to the coronavirus pandemic. down 2.99% (Compiled by Shradha Singh in Bengaluru) ((Shradha.Singh@thomsonreuters.com)) The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The top three S&P 500 .PG.INX percentage gainers: ** Netflix Inc , up 5.9% ** National Oilwell Varco Inc , up 5.3% ** Newmont Corp , up 5% The top three S&P 500 .PL.INX percentage losers: ** Royal Caribbean Cruises Ltd , down 14.3% ** Norwegian Cruise Line Holdings Ltd , down 13.1% ** Alliance Data Systems Corp , down 10.3% The top three NYSE .PG.N percentage gainers: ** Independence Contract Drilling Inc , up 60.8% ** Manning & Napier Inc , up 51.4% ** Can Fite Biofarma Ltd , up 40.8% The top two NYSE .PL.N percentage losers: ** IQ US Real Estate Small Cap ETF , down 23.4% ** AMC Entertainment Holdings Inc , down 20% The top three Nasdaq .PG.O percentage gainers: ** Scworx Corp , up 508.4% ** Borqs Technologies Inc , up 372% ** NN Inc, up 67.1% The top three Nasdaq .PL.O percentage losers: ** Sabre Corp , down 20.1% ** Mid-Con Energy Partners LP , down 16.2% ** Sotherly Hotels Inc , down 15.7% ** Ford Motor Co F.N: down 5.5% BUZZ-Falls as co projects Q1 loss of about $600 mln ** Dish Network Corp DISH.O: down 5.8% BUZZ- Falls as co cuts jobs, re-evaluates business ** Aurora Cannabis ACB.N: down 14.9% ** Tilray Inc TLRY.O: down 8.7% BUZZ-Falls on capital raise plans, reverse stock split ** Amazon.com Inc AMZN.O: up 4.7% ** Netflix NFLX.O: up 5.9% BUZZ-With millions stuck at home, Canaccord raises PT on Netflix, Amazon BUZZ-Amazon rises on plans to hire 75,000 workers amid coronavirus spread ** FedEx Corp FDX.N: up 0.5% BUZZ-FedEx rises as BofA upgrades to "buy" on Amazon shipping pause ** NXP Semiconductors NV NXPI.O: down 1.8% BUZZ-Evercore downgrades on falling demand from automotive sector ** AMC Entertainment Holdings Inc AMC.N: down 20.0% BUZZ-AMC tumbles 20% after unconfirmed report it may hire bankruptcy law firm ** General Electric Co GE.N: down 3.9% BUZZ-Falls after refinancing debt ** Carnival Corp CCL.N: down 7.2% ** Royal Caribbean Cruises Ltd RCL.N: down 14.3% ** Norwegian Cruise Line Holdings Ltd NCLH.N: down 13.1% BUZZ-Cruise operators dip after CDC extends "no sail" order ** BioCryst Pharmaceuticals Inc BCRX.O: up 13.3% BUZZ-Surges on beginning trial for potential COVID-19 treatment ** Boston Scientific Corp BSX.N: down 5.5% BUZZ-JPM cuts PT on bumpy near-term ** Biocept Inc BIOC.O: up 65.0% BUZZ-Up on plan to begin testing services for COVID-19 ** Gilead Sciencs Inc GILD.O: up 1.4% BUZZ-Street View: Gilead's coronavirus drug data leaves Wall St cautiously optimistic ** Alibaba Group Holding Ltd BABA.N: up 0.9% Buzz-KeyBanc raises PT on China recovery ** Athersys Inc ATHX.O: up 16.8% BUZZ-Jumps after FDA clears cell therapy trial in COVID-19 patients ** Yelp Inc YELP.N: down 4.1% BUZZ-J.P.Morgan cuts PT, earnings estimate on coronavirus impact ** Pluristem Therapeutics Inc PSTI.O: up 15.4% BUZZ-Pluristem jumps after its therapy treats 1st U.S. patient with COVID-19 complications ** Dropbox Inc DBX.O: up 2.4% BUZZ-Jefferies highlights work from home winners & losers ** Digital Realty Trust Inc DLR.N: down 4.1% BUZZ-Baird cuts data center REIT Digital Realty to "neutral" on valuation ** Zimmer Biomet Holdings Inc ZBH.N: down 3.8% BUZZ-Credit Suisse cuts PTs for MedTech as coronavirus slows elective surgeries ** CytoSorbents Corp CTSO.O: up 21.2% BUZZ- Up as FDA approves therapy for emergency use in COVID-19 patients ** Caterpillar Inc CAT.N: down 8.6% BUZZ-Caterpillar falls on BofA downgrade ** Quintana Energy Services Inc QES.N: down 21.0% BUZZ-Crashes on dismal industry outlook, furlough plans ** Qualstar Corp QBAK.O: down 19.1% BUZZ-Down on plans to delist from Nasdaq ** Johnson & Johnson JNJ.N: down 2.0% BUZZ-Credit Suisse cuts PT on coronavirus impact on surgeries BUZZ-PREVIEW: J&J set for Q1, med devices seen taking elective procedure hit ** Burlington Stores Inc BURL.N: down 6.0% BUZZ-Burlington Stores falls as co launches $1 bln capital raise, furloughs most staff ** Alimera Sciences Inc ALIM.O: up 14.7% BUZZ-Jumps after forecasting Q1 revenue ahead of estimates ** Natera Inc NTRA.O: down 9.4% BUZZ-Slips after withdrawing 2020 forecast ** Macy's Inc M.N: down 7.6% BUZZ-Macy's down on report of hiring Lazard for finance boosting options ** EBay Inc EBAY.O: up 2.4% BUZZ-Rises after CEO appointment ** JPMorgan Chase & Co JPM.N: down 4.0% BUZZ-PREVIEW: JPMorgan shares tumble amid expectations for dim Q1 results ** Enzo Biochem Inc ENZ.N: down 10.7% BUZZ-Drops as co's lab-testing volumes fall due to COVID-19 ** Borqs Technologies Inc BRQS.O: up 372.0% BUZZ-Borqs set for best day ever after receiving $150 mln line of credit ** Zoetis Inc ZTS.N: down 4.6% BUZZ-Guggenheim optimistic about animal health firms The 11 major S&P 500 sectors: Communication Services Eikon search string for individual stock moves: STXBZ The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh U.S. stock markets slipped in subdued trading on Monday after a strong rally last week, as corporate America launches into what is expected to be a painful quarterly earnings season due to the coronavirus pandemic. down 2.69% Real Estate | The top three S&P 500 .PG.INX percentage gainers: ** Netflix Inc , up 5.9% ** National Oilwell Varco Inc , up 5.3% ** Newmont Corp , up 5% The top three S&P 500 .PL.INX percentage losers: ** Royal Caribbean Cruises Ltd , down 14.3% ** Norwegian Cruise Line Holdings Ltd , down 13.1% ** Alliance Data Systems Corp , down 10.3% The top three NYSE .PG.N percentage gainers: ** Independence Contract Drilling Inc , up 60.8% ** Manning & Napier Inc , up 51.4% ** Can Fite Biofarma Ltd , up 40.8% The top two NYSE .PL.N percentage losers: ** IQ US Real Estate Small Cap ETF , down 23.4% ** AMC Entertainment Holdings Inc , down 20% The top three Nasdaq .PG.O percentage gainers: ** Scworx Corp , up 508.4% ** Borqs Technologies Inc , up 372% ** NN Inc, up 67.1% The top three Nasdaq .PL.O percentage losers: ** Sabre Corp , down 20.1% ** Mid-Con Energy Partners LP , down 16.2% ** Sotherly Hotels Inc , down 15.7% ** Ford Motor Co F.N: down 5.5% BUZZ-Falls as co projects Q1 loss of about $600 mln ** Dish Network Corp DISH.O: down 5.8% BUZZ- Falls as co cuts jobs, re-evaluates business ** Aurora Cannabis ACB.N: down 14.9% ** Tilray Inc TLRY.O: down 8.7% BUZZ-Falls on capital raise plans, reverse stock split ** Amazon.com Inc AMZN.O: up 4.7% ** Netflix NFLX.O: up 5.9% BUZZ-With millions stuck at home, Canaccord raises PT on Netflix, Amazon BUZZ-Amazon rises on plans to hire 75,000 workers amid coronavirus spread ** FedEx Corp FDX.N: up 0.5% BUZZ-FedEx rises as BofA upgrades to "buy" on Amazon shipping pause ** NXP Semiconductors NV NXPI.O: down 1.8% BUZZ-Evercore downgrades on falling demand from automotive sector ** AMC Entertainment Holdings Inc AMC.N: down 20.0% BUZZ-AMC tumbles 20% after unconfirmed report it may hire bankruptcy law firm ** General Electric Co GE.N: down 3.9% BUZZ-Falls after refinancing debt ** Carnival Corp CCL.N: down 7.2% ** Royal Caribbean Cruises Ltd RCL.N: down 14.3% ** Norwegian Cruise Line Holdings Ltd NCLH.N: down 13.1% BUZZ-Cruise operators dip after CDC extends "no sail" order ** BioCryst Pharmaceuticals Inc BCRX.O: up 13.3% BUZZ-Surges on beginning trial for potential COVID-19 treatment ** Boston Scientific Corp BSX.N: down 5.5% BUZZ-JPM cuts PT on bumpy near-term ** Biocept Inc BIOC.O: up 65.0% BUZZ-Up on plan to begin testing services for COVID-19 ** Gilead Sciencs Inc GILD.O: up 1.4% BUZZ-Street View: Gilead's coronavirus drug data leaves Wall St cautiously optimistic ** Alibaba Group Holding Ltd BABA.N: up 0.9% Buzz-KeyBanc raises PT on China recovery ** Athersys Inc ATHX.O: up 16.8% BUZZ-Jumps after FDA clears cell therapy trial in COVID-19 patients ** Yelp Inc YELP.N: down 4.1% BUZZ-J.P.Morgan cuts PT, earnings estimate on coronavirus impact ** Pluristem Therapeutics Inc PSTI.O: up 15.4% BUZZ-Pluristem jumps after its therapy treats 1st U.S. patient with COVID-19 complications ** Dropbox Inc DBX.O: up 2.4% BUZZ-Jefferies highlights work from home winners & losers ** Digital Realty Trust Inc DLR.N: down 4.1% BUZZ-Baird cuts data center REIT Digital Realty to "neutral" on valuation ** Zimmer Biomet Holdings Inc ZBH.N: down 3.8% BUZZ-Credit Suisse cuts PTs for MedTech as coronavirus slows elective surgeries ** CytoSorbents Corp CTSO.O: up 21.2% BUZZ- Up as FDA approves therapy for emergency use in COVID-19 patients ** Caterpillar Inc CAT.N: down 8.6% BUZZ-Caterpillar falls on BofA downgrade ** Quintana Energy Services Inc QES.N: down 21.0% BUZZ-Crashes on dismal industry outlook, furlough plans ** Qualstar Corp QBAK.O: down 19.1% BUZZ-Down on plans to delist from Nasdaq ** Johnson & Johnson JNJ.N: down 2.0% BUZZ-Credit Suisse cuts PT on coronavirus impact on surgeries BUZZ-PREVIEW: J&J set for Q1, med devices seen taking elective procedure hit ** Burlington Stores Inc BURL.N: down 6.0% BUZZ-Burlington Stores falls as co launches $1 bln capital raise, furloughs most staff ** Alimera Sciences Inc ALIM.O: up 14.7% BUZZ-Jumps after forecasting Q1 revenue ahead of estimates ** Natera Inc NTRA.O: down 9.4% BUZZ-Slips after withdrawing 2020 forecast ** Macy's Inc M.N: down 7.6% BUZZ-Macy's down on report of hiring Lazard for finance boosting options ** EBay Inc EBAY.O: up 2.4% BUZZ-Rises after CEO appointment ** JPMorgan Chase & Co JPM.N: down 4.0% BUZZ-PREVIEW: JPMorgan shares tumble amid expectations for dim Q1 results ** Enzo Biochem Inc ENZ.N: down 10.7% BUZZ-Drops as co's lab-testing volumes fall due to COVID-19 ** Borqs Technologies Inc BRQS.O: up 372.0% BUZZ-Borqs set for best day ever after receiving $150 mln line of credit ** Zoetis Inc ZTS.N: down 4.6% BUZZ-Guggenheim optimistic about animal health firms The 11 major S&P 500 sectors: Communication Services down 1.26% Consumer Discretionary up 0.01% Consumer Staples | The top three S&P 500 .PG.INX percentage gainers: ** Netflix Inc , up 5.9% ** National Oilwell Varco Inc , up 5.3% ** Newmont Corp , up 5% The top three S&P 500 .PL.INX percentage losers: ** Royal Caribbean Cruises Ltd , down 14.3% ** Norwegian Cruise Line Holdings Ltd , down 13.1% ** Alliance Data Systems Corp , down 10.3% The top three NYSE .PG.N percentage gainers: ** Independence Contract Drilling Inc , up 60.8% ** Manning & Napier Inc , up 51.4% ** Can Fite Biofarma Ltd , up 40.8% The top two NYSE .PL.N percentage losers: ** IQ US Real Estate Small Cap ETF , down 23.4% ** AMC Entertainment Holdings Inc , down 20% The top three Nasdaq .PG.O percentage gainers: ** Scworx Corp , up 508.4% ** Borqs Technologies Inc , up 372% ** NN Inc, up 67.1% The top three Nasdaq .PL.O percentage losers: ** Sabre Corp , down 20.1% ** Mid-Con Energy Partners LP , down 16.2% ** Sotherly Hotels Inc , down 15.7% ** Ford Motor Co F.N: down 5.5% BUZZ-Falls as co projects Q1 loss of about $600 mln ** Dish Network Corp DISH.O: down 5.8% BUZZ- Falls as co cuts jobs, re-evaluates business ** Aurora Cannabis ACB.N: down 14.9% ** Tilray Inc TLRY.O: down 8.7% BUZZ-Falls on capital raise plans, reverse stock split ** Amazon.com Inc AMZN.O: up 4.7% ** Netflix NFLX.O: up 5.9% BUZZ-With millions stuck at home, Canaccord raises PT on Netflix, Amazon BUZZ-Amazon rises on plans to hire 75,000 workers amid coronavirus spread ** FedEx Corp FDX.N: up 0.5% BUZZ-FedEx rises as BofA upgrades to "buy" on Amazon shipping pause ** NXP Semiconductors NV NXPI.O: down 1.8% BUZZ-Evercore downgrades on falling demand from automotive sector ** AMC Entertainment Holdings Inc AMC.N: down 20.0% BUZZ-AMC tumbles 20% after unconfirmed report it may hire bankruptcy law firm ** General Electric Co GE.N: down 3.9% BUZZ-Falls after refinancing debt ** Carnival Corp CCL.N: down 7.2% ** Royal Caribbean Cruises Ltd RCL.N: down 14.3% ** Norwegian Cruise Line Holdings Ltd NCLH.N: down 13.1% BUZZ-Cruise operators dip after CDC extends "no sail" order ** BioCryst Pharmaceuticals Inc BCRX.O: up 13.3% BUZZ-Surges on beginning trial for potential COVID-19 treatment ** Boston Scientific Corp BSX.N: down 5.5% BUZZ-JPM cuts PT on bumpy near-term ** Biocept Inc BIOC.O: up 65.0% BUZZ-Up on plan to begin testing services for COVID-19 ** Gilead Sciencs Inc GILD.O: up 1.4% BUZZ-Street View: Gilead's coronavirus drug data leaves Wall St cautiously optimistic ** Alibaba Group Holding Ltd BABA.N: up 0.9% Buzz-KeyBanc raises PT on China recovery ** Athersys Inc ATHX.O: up 16.8% BUZZ-Jumps after FDA clears cell therapy trial in COVID-19 patients ** Yelp Inc YELP.N: down 4.1% BUZZ-J.P.Morgan cuts PT, earnings estimate on coronavirus impact ** Pluristem Therapeutics Inc PSTI.O: up 15.4% BUZZ-Pluristem jumps after its therapy treats 1st U.S. patient with COVID-19 complications ** Dropbox Inc DBX.O: up 2.4% BUZZ-Jefferies highlights work from home winners & losers ** Digital Realty Trust Inc DLR.N: down 4.1% BUZZ-Baird cuts data center REIT Digital Realty to "neutral" on valuation ** Zimmer Biomet Holdings Inc ZBH.N: down 3.8% BUZZ-Credit Suisse cuts PTs for MedTech as coronavirus slows elective surgeries ** CytoSorbents Corp CTSO.O: up 21.2% BUZZ- Up as FDA approves therapy for emergency use in COVID-19 patients ** Caterpillar Inc CAT.N: down 8.6% BUZZ-Caterpillar falls on BofA downgrade ** Quintana Energy Services Inc QES.N: down 21.0% BUZZ-Crashes on dismal industry outlook, furlough plans ** Qualstar Corp QBAK.O: down 19.1% BUZZ-Down on plans to delist from Nasdaq ** Johnson & Johnson JNJ.N: down 2.0% BUZZ-Credit Suisse cuts PT on coronavirus impact on surgeries BUZZ-PREVIEW: J&J set for Q1, med devices seen taking elective procedure hit ** Burlington Stores Inc BURL.N: down 6.0% BUZZ-Burlington Stores falls as co launches $1 bln capital raise, furloughs most staff ** Alimera Sciences Inc ALIM.O: up 14.7% BUZZ-Jumps after forecasting Q1 revenue ahead of estimates ** Natera Inc NTRA.O: down 9.4% BUZZ-Slips after withdrawing 2020 forecast ** Macy's Inc M.N: down 7.6% BUZZ-Macy's down on report of hiring Lazard for finance boosting options ** EBay Inc EBAY.O: up 2.4% BUZZ-Rises after CEO appointment ** JPMorgan Chase & Co JPM.N: down 4.0% BUZZ-PREVIEW: JPMorgan shares tumble amid expectations for dim Q1 results ** Enzo Biochem Inc ENZ.N: down 10.7% BUZZ-Drops as co's lab-testing volumes fall due to COVID-19 ** Borqs Technologies Inc BRQS.O: up 372.0% BUZZ-Borqs set for best day ever after receiving $150 mln line of credit ** Zoetis Inc ZTS.N: down 4.6% BUZZ-Guggenheim optimistic about animal health firms The 11 major S&P 500 sectors: Communication Services Eikon search string for individual stock moves: STXBZ The Day Ahead newsletter: http://tmsnrt.rs/2ggOmBi The Morning News Call newsletter: http://tmsnrt.rs/2fwPLTh U.S. stock markets slipped in subdued trading on Monday after a strong rally last week, as corporate America launches into what is expected to be a painful quarterly earnings season due to the coronavirus pandemic. .N At 01:08 pm ET, the Dow Jones Industrial Average .DJI was down 2.14% at 23,212.28. |
37566.0 | 2020-04-13 00:00:00 UTC | TSX falls 0.64% to 14,075.94 | ACB | https://www.nasdaq.com/articles/tsx-falls-0.64-to-14075.94-2020-04-13 | nan | nan | * The Toronto Stock Exchange's TSX falls 0.64 percent to 14,075.94
* Leading the index were Eldorado Gold Corp , up 12.0%, Sandstorm Gold Ltd SSL.TO, up 11.6%, and Torex Gold Resources Inc TXG.TO, higher by 10.7%.
* Lagging shares were Aurora Cannabis Inc ACB.TO, down 13.1%, Cineplex Inc CGX.TO, down 11.1%, and MTY Food Group Inc MTY.TO, lower by 8.6%.
* On the TSX 84 issues rose and 145 fell as a 0.6-to-1 ratio favored decliners. There were 5 new highs and no new lows, with total volume of 326.4 million shares.
* The most heavily traded shares by volume were Aurora Cannabis Inc ACB.TO, Toronto-dominion Bank TD.TO and Yamana Gold Inc YRI.TO.
* The TSX's energy group .SPTTEN fell 0.53 points, or 0.8%, while the financials sector .SPTTFS slipped 7.07 points, or 2.8%.
* West Texas Intermediate crude futures CLc1 fell 1.49%, or $0.34, to $22.42 a barrel. Brent crude LCOc1 rose 1.11%, or $0.35, to $31.83 O/R
* The TSX is off 17.5% for the year.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | * Lagging shares were Aurora Cannabis Inc ACB.TO, down 13.1%, Cineplex Inc CGX.TO, down 11.1%, and MTY Food Group Inc MTY.TO, lower by 8.6%. * The most heavily traded shares by volume were Aurora Cannabis Inc ACB.TO, Toronto-dominion Bank TD.TO and Yamana Gold Inc YRI.TO. * On the TSX 84 issues rose and 145 fell as a 0.6-to-1 ratio favored decliners. | * Lagging shares were Aurora Cannabis Inc ACB.TO, down 13.1%, Cineplex Inc CGX.TO, down 11.1%, and MTY Food Group Inc MTY.TO, lower by 8.6%. * The most heavily traded shares by volume were Aurora Cannabis Inc ACB.TO, Toronto-dominion Bank TD.TO and Yamana Gold Inc YRI.TO. * The TSX's energy group .SPTTEN fell 0.53 points, or 0.8%, while the financials sector .SPTTFS slipped 7.07 points, or 2.8%. | * The most heavily traded shares by volume were Aurora Cannabis Inc ACB.TO, Toronto-dominion Bank TD.TO and Yamana Gold Inc YRI.TO. * Lagging shares were Aurora Cannabis Inc ACB.TO, down 13.1%, Cineplex Inc CGX.TO, down 11.1%, and MTY Food Group Inc MTY.TO, lower by 8.6%. * The Toronto Stock Exchange's TSX falls 0.64 percent to 14,075.94 * Leading the index were Eldorado Gold Corp , up 12.0%, Sandstorm Gold Ltd SSL.TO, up 11.6%, and Torex Gold Resources Inc TXG.TO, higher by 10.7%. | * The most heavily traded shares by volume were Aurora Cannabis Inc ACB.TO, Toronto-dominion Bank TD.TO and Yamana Gold Inc YRI.TO. * Lagging shares were Aurora Cannabis Inc ACB.TO, down 13.1%, Cineplex Inc CGX.TO, down 11.1%, and MTY Food Group Inc MTY.TO, lower by 8.6%. * The TSX's energy group .SPTTEN fell 0.53 points, or 0.8%, while the financials sector .SPTTFS slipped 7.07 points, or 2.8%. |
37567.0 | 2020-04-13 00:00:00 UTC | Aurora Cannabis falls on capital raise, reverse stock split | ACB | https://www.nasdaq.com/articles/aurora-cannabis-falls-on-capital-raise-reverse-stock-split-2020-04-13 | nan | nan | April 13 (Reuters) - Aurora Cannabis Inc's ACB.TO, ACB.N U.S.-listed shares fell nearly 14% in morning trade on Monday after the Canadian pot producer renewed an at-the-market offering under which it can raise as much as $350 million in equity capital.
The company said its board also approved a reverse stock split of 1:12 to boost its share price above $1, the minimum required to maintain a listing on the New York Stock Exchange.
Aurora's U.S.-listed shares were last trading below 80 cents.
Companies in the nascent marijuana industry had a rough 2019 and things are worsening this year, with many running out of cash at a time when the coronavirus pandemic has investors on the sidelines across all sectors.
Producers CannTrust Holdings Inc TRST.TO and James E Wagner Cultivation Corp JWCAh.V filed for bankruptcy protection two weeks earlier.
Edmonton, Alberta-based Aurora said on Monday it had about C$205 million ($146.8 million) cash as of March 31, including all the money it raised under the original at-the-market offering announced in May 2019.
Shares of other cannabis companies were also down on Monday with Tilray Inc TLRY.O down more than 8%, Hexo Corp HEXO.TO off 5% and Cronos Group Inc CRON.TO and Canopy Growth Corp WEED.TO down over 3%.
($1 = 1.3966 Canadian dollars)
(Reporting by Shariq Khan in Bengaluru; Editing by Shounak Dasgupta)
((Shariq.Khan@thomsonreuters.com; Within U.S.+1 646 223 8780, outside U.S. +91 80 6182 2681; Twitter: @shariqrtrs))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | April 13 (Reuters) - Aurora Cannabis Inc's ACB.TO, ACB.N U.S.-listed shares fell nearly 14% in morning trade on Monday after the Canadian pot producer renewed an at-the-market offering under which it can raise as much as $350 million in equity capital. Companies in the nascent marijuana industry had a rough 2019 and things are worsening this year, with many running out of cash at a time when the coronavirus pandemic has investors on the sidelines across all sectors. Producers CannTrust Holdings Inc TRST.TO and James E Wagner Cultivation Corp JWCAh.V filed for bankruptcy protection two weeks earlier. | April 13 (Reuters) - Aurora Cannabis Inc's ACB.TO, ACB.N U.S.-listed shares fell nearly 14% in morning trade on Monday after the Canadian pot producer renewed an at-the-market offering under which it can raise as much as $350 million in equity capital. Aurora's U.S.-listed shares were last trading below 80 cents. Edmonton, Alberta-based Aurora said on Monday it had about C$205 million ($146.8 million) cash as of March 31, including all the money it raised under the original at-the-market offering announced in May 2019. | April 13 (Reuters) - Aurora Cannabis Inc's ACB.TO, ACB.N U.S.-listed shares fell nearly 14% in morning trade on Monday after the Canadian pot producer renewed an at-the-market offering under which it can raise as much as $350 million in equity capital. Edmonton, Alberta-based Aurora said on Monday it had about C$205 million ($146.8 million) cash as of March 31, including all the money it raised under the original at-the-market offering announced in May 2019. Shares of other cannabis companies were also down on Monday with Tilray Inc TLRY.O down more than 8%, Hexo Corp HEXO.TO off 5% and Cronos Group Inc CRON.TO and Canopy Growth Corp WEED.TO down over 3%. | April 13 (Reuters) - Aurora Cannabis Inc's ACB.TO, ACB.N U.S.-listed shares fell nearly 14% in morning trade on Monday after the Canadian pot producer renewed an at-the-market offering under which it can raise as much as $350 million in equity capital. The company said its board also approved a reverse stock split of 1:12 to boost its share price above $1, the minimum required to maintain a listing on the New York Stock Exchange. Companies in the nascent marijuana industry had a rough 2019 and things are worsening this year, with many running out of cash at a time when the coronavirus pandemic has investors on the sidelines across all sectors. |
37568.0 | 2020-04-13 00:00:00 UTC | Aurora Cannabis Plans Reverse Stock Split to Avoid NYSE Delisting | ACB | https://www.nasdaq.com/articles/aurora-cannabis-plans-reverse-stock-split-to-avoid-nyse-delisting-2020-04-13 | nan | nan | Aurora Cannabis (NYSE: ACB) will soon have considerably fewer shares of common stock outstanding.
The company announced it is planning a 1-for-12 reverse stock split. This would reduce its outstanding share count from just over 1.3 billion to just under 109.5 million, assuming no additional stock is issued before that happens.
Aurora says the consolidation will occur on or about May 11. For most shareholders, this process will be automatic, although owners of physical stock certificates will need to complete and mail official paperwork in order to receive certificates for the newly consolidated stock.
Image source: Getty Images.
Reverse stock splits are relatively rare occurrences. Aurora is doing this one because otherwise, it is at serious risk of being delisted from the New York Stock Exchange (NYSE). As per the Exchange's listing standards, a listed stock cannot trade below an average of $1 for 30 consecutive days; Aurora's stock has closed under $1 consistently since late March.
The decision was announced in an investor update Aurora published on Monday. The marijuana company said that its "business transformation targets" were being met. These include cuts in operating costs and capital expenditures, and what it terms "reducing complexity in the organization." It also reaffirmed its revenue guidance for the third quarter of its fiscal 2020, saying that it still expects "modest" quarter-over-quarter growth.
Aurora also aims to raise more capital. It said in the update that it will refresh its at-the-market program, under which it will sell as much as $350 million in stock.
The company's already-precarious share price took another hit on the news, falling by 13% on Monday. This was significantly steeper than the declines recorded by the major equities indexes on the day.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Aurora Cannabis (NYSE: ACB) will soon have considerably fewer shares of common stock outstanding. This would reduce its outstanding share count from just over 1.3 billion to just under 109.5 million, assuming no additional stock is issued before that happens. Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks. | Aurora Cannabis (NYSE: ACB) will soon have considerably fewer shares of common stock outstanding. The company announced it is planning a 1-for-12 reverse stock split. Reverse stock splits are relatively rare occurrences. | Aurora Cannabis (NYSE: ACB) will soon have considerably fewer shares of common stock outstanding. For most shareholders, this process will be automatic, although owners of physical stock certificates will need to complete and mail official paperwork in order to receive certificates for the newly consolidated stock. As per the Exchange's listing standards, a listed stock cannot trade below an average of $1 for 30 consecutive days; Aurora's stock has closed under $1 consistently since late March. | Aurora Cannabis (NYSE: ACB) will soon have considerably fewer shares of common stock outstanding. Aurora says the consolidation will occur on or about May 11. The decision was announced in an investor update Aurora published on Monday. |
37569.0 | 2020-04-13 00:00:00 UTC | 5 Very Good Reasons Not to Buy Aurora Cannabis | ACB | https://www.nasdaq.com/articles/5-very-good-reasons-not-to-buy-aurora-cannabis-2020-04-13 | nan | nan | It's incredible what a difference a year can make.
At this time last year, expectations for the marijuana industry were (pardon the pun) high. Canada had somewhat recently launched recreational weed sales, and our northerly neighbor was preparing for the launch of high-margin derivatives, such as edibles, vapes, and infused beverages. Meanwhile, numerous U.S. states looked to be on the verge of legalizing recreational pot.
Image source: Getty Images.
Then the rug was pulled out from beneath pot stocks. Over the trailing 12 months, there's probably not a collectively worse-performing group of stocks than cannabis. Everything from supply issues to a resilient black market has stymied marijuana stock growth over the past year, and previously bloated valuations have come crashing back to Earth.
One such stock that's taken it on the chin is Aurora Cannabis (NYSE: ACB). Aurora just so happens to be the most widely held stock on millennial-focused investment app Robinhood. But as investors have discovered, popularity and profitability don't necessarily go hand in hand. Since mid-March 2019, Aurora's share price has declined by about 91%.
For some marijuana stock investors, this decline in Aurora Cannabis looks to be the perfect buying opportunity. After all, this was a company that, just nine months ago, was projected to lead the world in legal cannabis production and had access to more overseas countries than any other licensed producer in Canada. But here are five very good reasons why investors should keep their distance and not buy Aurora Cannabis.
Image source: Getty Images.
1. No immediate path to profitability
To begin with, Aurora Cannabis is still a long way off from officially generating a recurring profit. And profits are more in focus now, given the coronavirus disease 2019 (COVID-19) crash, than in recent memory.
With supply bottlenecked in Ontario due to an inadequate number of dispensaries being opened since October 2018, Aurora Cannabis' management team has chosen to focus on pushing toward profitability by slashing costs. Within the past six months, the company has halted construction on two of its largest cultivation farms (Aurora Sun in Alberta and Aurora Nordic 2 in Denmark), announced that it would put the 1-million-square-foot Exeter greenhouse up for sale, and cut 500 jobs. While cost-cutting was likely a necessity given the willy nilly expansion of the Canadian pot industry, growth by cost-cutting can only take Aurora Cannabis so far.
Based on Wall Street's current estimates, don't expect Aurora to be profitable on a recurring basis until at least fiscal 2022.
Image source: Getty Images.
2. Ongoing share-based dilution
From tiny cannabis companies to the most popular pot stocks, financing is a big problem right now – even for a well-known name like Aurora Cannabis. Despite marijuana being legal in Canada, no bank that can read a balance sheet or income statement is going to give Aurora a large loan. Thus, the company's only means of consistently raising cash over the years has been to sell its common stock.
Though selling its common stock has been effective, it's absolutely destroyed shareholder value. Between June 2014 and December 2019, Aurora's outstanding share count has risen from approximately 16 million to 1.17 billion!
Making matters worse, the company's management discussion and analysis, posted following the end of its fiscal second quarter, showed $156.3 million Canadian in cash and cash equivalents, CA$26.1 million in marketable securities, and CA$373.6 million in short-term liabilities. In layman's terms, the company's expected costs for calendar year 2020 broadly outweigh its available cash.
Image source: Getty Images.
3. A high probability of a writedown
Speaking of ugly balance sheets, Aurora Cannabis gets my nod for worst in class.
Aside from an expected cash shortfall, Aurora has also built up quite the mountain of goodwill – i.e., the premium paid above and beyond tangible assets when making an acquisition. Since August 2016, it acquired more than a dozen businesses, practically all of which were grossly overvalued in hindsight. Even after taking a CA$762 million writedown during the fiscal second quarter, Aurora is still left with CA$2.41 billion in goodwill on its balance sheet. That's roughly twice its current market cap, and it still represents 52% of total assets.
What's more, the writedown Aurora took in Q2 2020 was primarily reflective of its overseas assets in South America and Denmark. To me this is maddening, because the company's most overvalued acquisition of all was its CA$2.64 billion purchase of Canadian licensed producer MedReleaf. With Exeter now up for sale, all Aurora ever received for its CA$2.64 billion purchase is 35,000 kilos of annual cannabis output and a handful of MedReleaf pot brands. In short, big writedowns still await.
Image source: Getty Images.
4. It's "stuck" with idled assets
Fourthly, investors can't overlook the fact that cost-cutting is going to leave Aurora Cannabis with a lot of nonproducing assets.
Don't get me wrong – I do believe the best course of action for Aurora Cannabis is to lay off workers and idle production given that domestic retail channels aren't yet prepared to handle the type of output Aurora is capable of. But there's no denying that going from more than 650,000 kilos in peak projected annual output to less than 250,000 kilos of run-rate annual output (based on what's currently operational) is going to sting.
Another problem here is that there's no readily available way to sell these assets if Aurora needs cash. Given the persistent problems Canada's pot industry has faced, and the lack of traditional financing options available, Aurora is basically stuck with a number of nonperforming or underperforming assets.
Image source: Getty Images.
5. Delisting may be imminent
As the icing on the cake, Aurora Cannabis has spent much of the past month trading below $1 a share. Even with the stock market bouncing decisively off of its lows, Aurora Cannabis' stock has hardly budged.
In order for public companies to remain listed on the New York Stock Exchange, they need to maintain a minimum share price of $1. The good news is that Aurora could appeal a delisting notice, should it receive one, and hope its share price rebounds to north of $1 on a consistent basis. But given its mammoth number of outstanding shares, the company already has an arguably bloated market cap of nearly $1 billion at less than $1 per share.
With the possibility of delisting on the horizon, investors have more than enough reasons to steer clear of Aurora Cannabis.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Sean Williams has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | One such stock that's taken it on the chin is Aurora Cannabis (NYSE: ACB). Everything from supply issues to a resilient black market has stymied marijuana stock growth over the past year, and previously bloated valuations have come crashing back to Earth. With supply bottlenecked in Ontario due to an inadequate number of dispensaries being opened since October 2018, Aurora Cannabis' management team has chosen to focus on pushing toward profitability by slashing costs. | One such stock that's taken it on the chin is Aurora Cannabis (NYSE: ACB). Making matters worse, the company's management discussion and analysis, posted following the end of its fiscal second quarter, showed $156.3 million Canadian in cash and cash equivalents, CA$26.1 million in marketable securities, and CA$373.6 million in short-term liabilities. To me this is maddening, because the company's most overvalued acquisition of all was its CA$2.64 billion purchase of Canadian licensed producer MedReleaf. | One such stock that's taken it on the chin is Aurora Cannabis (NYSE: ACB). Ongoing share-based dilution From tiny cannabis companies to the most popular pot stocks, financing is a big problem right now – even for a well-known name like Aurora Cannabis. Don't get me wrong – I do believe the best course of action for Aurora Cannabis is to lay off workers and idle production given that domestic retail channels aren't yet prepared to handle the type of output Aurora is capable of. | One such stock that's taken it on the chin is Aurora Cannabis (NYSE: ACB). To me this is maddening, because the company's most overvalued acquisition of all was its CA$2.64 billion purchase of Canadian licensed producer MedReleaf. It's "stuck" with idled assets Fourthly, investors can't overlook the fact that cost-cutting is going to leave Aurora Cannabis with a lot of nonproducing assets. |
37570.0 | 2020-04-11 00:00:00 UTC | Italy Medical Pot Sales Rise Almost 50% to New Record in 2019 | ACB | https://www.nasdaq.com/articles/italy-medical-pot-sales-rise-almost-50-to-new-record-in-2019-2020-04-12 | nan | nan | Similar to the dynamic seen in many U.S. states and Canadian provinces, Italy bought significantly more cannabis in 2019 than in the previous year. Citing official government statistics, Marijuana Business Daily reported that the volume of cannabis sold in the country rose almost 50%.
All told, Italians purchased 861 kilos of medical marijuana during the year, well up from the 578 kilos of 2018. Italy is one of the few European countries that has legalized the medical form of the drug; recreational cannabis remains illegal.
Image source: Getty Images.
That amount makes Italy the No. 2 consumer of licensed medical marijuana in Europe, second only to Germany. The latter's government recently admitted that it did not know how much product its citizens purchased in 2019, although one reliable number -- the 6,714 kilos it important during the year -- shows it's clearly the leader.
Both Italy and Germany legalized medical marijuana in the 2010s. Italy did so in 2013, and Germany turned on the green light in 2017.
In Italy, most cannabis sold is exported by the Dutch Office of Medical Cannabis and grown by that country's only commercial cultivator, Bedrocan. A small amount of Italian marijuana is grown domestically by an arm of the Ministry of Defense.
The only publicly traded North American marijuana company involved in Italy is Aurora Cannabis (NYSE: ACB), which began shipping a modest amount of product there in 2018, and the following year won a tender to provide 400 kilos over a two-year stretch. Aurora is also active on the German market, although it temporarily had its license suspended late last year.
On Thursday, Aurora's share price rose by 2.8%, exceeding the gains of the key stock market indexes on the day.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The only publicly traded North American marijuana company involved in Italy is Aurora Cannabis (NYSE: ACB), which began shipping a modest amount of product there in 2018, and the following year won a tender to provide 400 kilos over a two-year stretch. Citing official government statistics, Marijuana Business Daily reported that the volume of cannabis sold in the country rose almost 50%. The latter's government recently admitted that it did not know how much product its citizens purchased in 2019, although one reliable number -- the 6,714 kilos it important during the year -- shows it's clearly the leader. | The only publicly traded North American marijuana company involved in Italy is Aurora Cannabis (NYSE: ACB), which began shipping a modest amount of product there in 2018, and the following year won a tender to provide 400 kilos over a two-year stretch. All told, Italians purchased 861 kilos of medical marijuana during the year, well up from the 578 kilos of 2018. Both Italy and Germany legalized medical marijuana in the 2010s. | The only publicly traded North American marijuana company involved in Italy is Aurora Cannabis (NYSE: ACB), which began shipping a modest amount of product there in 2018, and the following year won a tender to provide 400 kilos over a two-year stretch. In Italy, most cannabis sold is exported by the Dutch Office of Medical Cannabis and grown by that country's only commercial cultivator, Bedrocan. See the 10 stocks Stock Advisor returns as of 2/1/20 Eric Volkman has no position in any of the stocks mentioned. | The only publicly traded North American marijuana company involved in Italy is Aurora Cannabis (NYSE: ACB), which began shipping a modest amount of product there in 2018, and the following year won a tender to provide 400 kilos over a two-year stretch. All told, Italians purchased 861 kilos of medical marijuana during the year, well up from the 578 kilos of 2018. Both Italy and Germany legalized medical marijuana in the 2010s. |
37571.0 | 2020-04-11 00:00:00 UTC | 1 Pot Stock That's in Danger of Being Delisted | ACB | https://www.nasdaq.com/articles/1-pot-stock-thats-in-danger-of-being-delisted-2020-04-11 | nan | nan | Trading on a major exchange can give a company access to a significant pool of investors, meaning easier access to funding and expedited growth. That's why listing on an exchange like the NYSE or NASDAQ is the goal for many pot stocks. However, with marijuana still illegal at the federal level in the U.S., cannabis companies operating in the U.S. are in violation of federal laws, meaning they cannot trade on either of those major exchanges.
Canada-based cannabis companies have been able to avoid that problem because pot is legal in Canada. Unfortunately, with many pot stocks struggling and the Horizons Marijuana Life Sciences ETF (OTC: HMLSF) down more than 30% this year, some of them face a new problem -- getting delisted from the NYSE.
The NYSE's $1 requirement may push one company to make a big decision
One of the ways a company can run into trouble on the NYSE is if its share price drops below $1 for 30 trading days. If this happens, the exchange sends a warning requiring the company to make a plan for bringing its share price back above $1. That's what happened to Rite Aid (NYSE: RAD) in early 2019, when its stock was trading at $0.75 and was averaging a price of less than $1 over the past month. The company ended up staying on the exchange, but in order to do so, it made a 1:20 reverse stock split. The move instantly pushed the stock above $1.
It's something that marijuana giant Aurora Cannabis (NYSE: ACB) may need to do in order to remain on the NYSE as well. Before the coronavirus, the stock was hovering at about $1.30. In March, when the pandemic became front-and-center on newscasts around the world, the stock plummeted below $1, and it's been around that mark for the past few weeks. It briefly spiked up above $1, but for the most part, it's struggled below that level.
Image source: Getty Images.
If Aurora were to do a reverse stock split, it wouldn't affect its valuation; it would only change its number of shares outstanding. It's not great for investors to see a company using a reverse split just to stay on an exchange, but it doesn't lead to dilution, either -- it just suggests there's little confidence from the company that the stock can stay above the $1 threshold on its own.
In the Rite Aid example, the stock would crater more than 40% in 2019 in what was looking to be another bad year for the company after the reverse stock split. However, the year was salvaged by an impressive earnings beat in December that sent the stock skyrocketing, erasing many of those losses.
A reverse stock split may fix one problem -- staying on a major exchange -- but it won't get investors excited about a stock. The danger for Aurora investors is that a reverse stock split could make it an attractive option for short-sellers, and that could lead to more losses along the way. Some brokerages have limits to prevent investors from shorting stocks that are trading below a certain value. That's where a boost in the price via a reverse stock split could actually do more harm than good for investors.
Why Aurora may be safe -- for now
The good news for Aurora investors is that in the wake of the coronavirus pandemic, the NYSE has decided to temporarily waive the minimum $1 requirement for a stock. In a statement, the NYSE said: "In its conversations with listed companies, the Exchange has learned that many companies are experiencing severe disruptions to their businesses during the current crisis, including employees who have contracted the COVID-19 virus and the need to adopt emergency measures to protect their employees from infection."
The last time the NYSE resorted to similar measures was during the housing-related financial crisis more than a decade ago.
What does this mean for investors?
Since the NYSE is not going to come after stocks hit hard as a result of the coronavirus pandemic, Aurora investors won't have to worry about the stock being delisted from the NYSE, at least for now. There was no date given as to when the NYSE's original rules may come back into play, but the new state of affairs may very well last at least until the pandemic is under control and businesses can resume their day-to-day operations.
In the end, this may prove to be just a waiting game for Aurora; the stock is already down about 60% this year, significantly worse than the benchmark Horizons ETF and the S&P 500, which is down just 14% year to date. The company is coming off a disappointing second-quarter result in February in which it posted another loss and forecasted potentially no sales growth for the next quarter.
There's simply little reason to be bullish on Aurora right now. Even if the pandemic temporarily stops the NYSE from warning the company to get its share price back up, it may only be a matter of time before that happens. Until the pot stock can show significant progress in its earnings reports and demonstrate a realistic possibility of breaking even, this is a stock investors should stay far away from.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
David Jagielski has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | It's something that marijuana giant Aurora Cannabis (NYSE: ACB) may need to do in order to remain on the NYSE as well. Unfortunately, with many pot stocks struggling and the Horizons Marijuana Life Sciences ETF (OTC: HMLSF) down more than 30% this year, some of them face a new problem -- getting delisted from the NYSE. There was no date given as to when the NYSE's original rules may come back into play, but the new state of affairs may very well last at least until the pandemic is under control and businesses can resume their day-to-day operations. | It's something that marijuana giant Aurora Cannabis (NYSE: ACB) may need to do in order to remain on the NYSE as well. A reverse stock split may fix one problem -- staying on a major exchange -- but it won't get investors excited about a stock. Since the NYSE is not going to come after stocks hit hard as a result of the coronavirus pandemic, Aurora investors won't have to worry about the stock being delisted from the NYSE, at least for now. | It's something that marijuana giant Aurora Cannabis (NYSE: ACB) may need to do in order to remain on the NYSE as well. It's not great for investors to see a company using a reverse split just to stay on an exchange, but it doesn't lead to dilution, either -- it just suggests there's little confidence from the company that the stock can stay above the $1 threshold on its own. A reverse stock split may fix one problem -- staying on a major exchange -- but it won't get investors excited about a stock. | It's something that marijuana giant Aurora Cannabis (NYSE: ACB) may need to do in order to remain on the NYSE as well. A reverse stock split may fix one problem -- staying on a major exchange -- but it won't get investors excited about a stock. What does this mean for investors? |
37572.0 | 2020-04-10 00:00:00 UTC | 3 Pot Stocks to Avoid as the Coronavirus Pandemic Continues | ACB | https://www.nasdaq.com/articles/3-pot-stocks-to-avoid-as-the-coronavirus-pandemic-continues-2020-04-10 | nan | nan | Even before the coronavirus pandemic, most cannabis companies were struggling to get a grip on their financial situations. Whether the issue was continued losses, increasing inventory buildups, or substantial goodwill write-downs, few companies were thriving going into this pandemic.
As COVID-19 continues to spread and shut down various aspects of the economy, the vast majority of pot stocks are now trading at steep discounts. While there are some stocks worth buying at these low prices, investors should be cautious about investing in most cannabis companies.
In particular, these three | Whether the issue was continued losses, increasing inventory buildups, or substantial goodwill write-downs, few companies were thriving going into this pandemic. As COVID-19 continues to spread and shut down various aspects of the economy, the vast majority of pot stocks are now trading at steep discounts. While there are some stocks worth buying at these low prices, investors should be cautious about investing in most cannabis companies. | Even before the coronavirus pandemic, most cannabis companies were struggling to get a grip on their financial situations. Whether the issue was continued losses, increasing inventory buildups, or substantial goodwill write-downs, few companies were thriving going into this pandemic. While there are some stocks worth buying at these low prices, investors should be cautious about investing in most cannabis companies. | Whether the issue was continued losses, increasing inventory buildups, or substantial goodwill write-downs, few companies were thriving going into this pandemic. As COVID-19 continues to spread and shut down various aspects of the economy, the vast majority of pot stocks are now trading at steep discounts. While there are some stocks worth buying at these low prices, investors should be cautious about investing in most cannabis companies. | Even before the coronavirus pandemic, most cannabis companies were struggling to get a grip on their financial situations. Whether the issue was continued losses, increasing inventory buildups, or substantial goodwill write-downs, few companies were thriving going into this pandemic. As COVID-19 continues to spread and shut down various aspects of the economy, the vast majority of pot stocks are now trading at steep discounts. |
37573.0 | 2020-04-08 00:00:00 UTC | Why Aurora Cannabis Stock Lost 30% in March | ACB | https://www.nasdaq.com/articles/why-aurora-cannabis-stock-lost-30-in-march-2020-04-08 | nan | nan | What happened
Shares of Aurora Cannabis (NYSE: ACB) underperformed the market last month, falling 30% compared with a 12.5% decline in the S&P 500, according to data provided by S&P Global Market Intelligence.
That slump added to a rough run for owners of the pot stock, who are down over 60% since the start of the year.
Image source: Getty Images.
So what
Aurora Cannabis was caught up in the general market turmoil around COVID-19 and related containment measures, which have ground commerce to a standstill in key industries like travel and in major economies across Europe and North America. The company joined its peers in sinking last month as volatility picked up and investors avoided stocks with weaknesses such as unprofitable business models and high levels of debt.
Now what
Aurora faces significant challenges over the short term, including a potential delisting by the New York Stock Exchange for trading below $1 per share. Yet the long-term path of the stock will depend more on management's ability to get its business operating in the black even as competition in the marijuana industry remains fierce.
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*Stock Advisor returns as of March 18, 2020
Demitrios Kalogeropoulos has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | What happened Shares of Aurora Cannabis (NYSE: ACB) underperformed the market last month, falling 30% compared with a 12.5% decline in the S&P 500, according to data provided by S&P Global Market Intelligence. So what Aurora Cannabis was caught up in the general market turmoil around COVID-19 and related containment measures, which have ground commerce to a standstill in key industries like travel and in major economies across Europe and North America. The company joined its peers in sinking last month as volatility picked up and investors avoided stocks with weaknesses such as unprofitable business models and high levels of debt. | What happened Shares of Aurora Cannabis (NYSE: ACB) underperformed the market last month, falling 30% compared with a 12.5% decline in the S&P 500, according to data provided by S&P Global Market Intelligence. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market. * David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Aurora Cannabis Inc. wasn't one of them! | What happened Shares of Aurora Cannabis (NYSE: ACB) underperformed the market last month, falling 30% compared with a 12.5% decline in the S&P 500, according to data provided by S&P Global Market Intelligence. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market. * David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Aurora Cannabis Inc. wasn't one of them! | What happened Shares of Aurora Cannabis (NYSE: ACB) underperformed the market last month, falling 30% compared with a 12.5% decline in the S&P 500, according to data provided by S&P Global Market Intelligence. 10 stocks we like better than Aurora Cannabis Inc. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market. |
37574.0 | 2020-04-08 00:00:00 UTC | The Coronavirus Just Gut-Punched Canadian Pot Stocks | ACB | https://www.nasdaq.com/articles/the-coronavirus-just-gut-punched-canadian-pot-stocks-2020-04-08 | nan | nan | For the past year, there hasn't been a more disappointing industry for investors than cannabis. Following a blazing-hot first quarter in 2019 that saw more than a dozen pot stocks return at least 70%, virtually all marijuana stocks have retraced anywhere from 50% to 95% over the past year.
What's particularly interesting is that the country given the first crack at becoming a global cannabis leader -- Canada -- has completely flopped at the task. Now, with the coronavirus disease 2019 (COVID-19) spreading globally, things for the Canadian pot industry have gone from bad to worse.
Image source: Getty Images.
A trio of problems have plagued the Canadian marijuana industry
On Oct. 17, 2018, Canada officially became the first industrialized country in the modern era to allow for the sale of adult-use marijuana. The expectation at the time from Wall Street analysts was that Canadian demand would quickly build to between 800,000 kilos and 1 million kilos per year, with Canadian marijuana stocks turning the corner to profitability toward the end of calendar year 2019. It was a time of rapid cultivation expansion and acquisitions galore.
However, the Canadian weed industry has been completely derailed by regulatory issues, financing concerns, and ugly balance sheets.
In terms of regulatory issues, Health Canada was slow to approve cultivation and sales license applications, and delayed the launch of high-margin derivatives, such as edibles, beverages, and vapes, by two months. Meanwhile, provincial regulators in Ontario utilized a lottery system to assign dispensary licenses until the end of 2019, resulting in far too few store openings and a supply bottleneck in Canada's most-populous province.
Second, there have been financing concerns. Even with banks free to lend to a legal cannabis industry, most financial institutions have chosen not to given the many supply bottlenecks plaguing the industry. For instance, in an effort to reduce its expenses, HEXO (NYSE: HEXO) has reduced its peak output potential by about a third and shed 200 jobs. HEXO's also been forced to sell its common stock and/or issue convertible debt to bolster its balance sheet.
Then there are the aforementioned "ugly balance sheets" that have kept marijuana stocks from excelling. For example, Aurora Cannabis (NYSE: ACB) wound up grossly overspending on capacity, pushing its goodwill up to nearly $3.2 billion Canadian at one point. Aurora has since laid off 500 workers, halted construction on two of its largest projects, and planned to sell another greenhouse that was expected to play a major role in production, once retrofit for cannabis plants.
Image source: Getty Images.
COVID-19's gut punch to the Canadian cannabis industry
In theory, just about nothing could have gone worse for our neighbor to the north following its marijuana launch 1.5 years ago. Then the coronavirus pandemic hit, and it's turned the industry into a virtual dumpster fire.
Just this past week, Ontario's provincial regulators announced that cannabis shops were not considered essential services, and were thus forced to close for two weeks, as of 11:59pm EDT on April 4. Thankfully, two days following the closure, an emergency order allowed pot shops to reopen, albeit only for phone and online orders
Nevertheless, this is a blow in two major respects. First, Ontario is Canada's largest province, accounting for nearly 40% of its population. Even shutting down in-store access to pot shops for two weeks, at minimum, should substantially slow sales in the region.
The dispensary closure announcement wound up hitting Canopy Growth (NYSE: CGC), the largest marijuana stock by market cap, particularly hard given its physical retail presence in Ontario. Canopy Growth opened five Tokyo Smoke retail stores in late 2019 (bringing the total number of Tokyo Smoke operating retail stores in Ontario to seven), and as of January was working on opening an additional five dispensaries.
The second issue being that Ontario ditched its ineffective lottery system for assigning dispensary licenses at the end of 2019 in favor of a more traditional application vetting process. With a meager 52 open dispensaries in a province that could easily accommodate 1,000 retail cannabis stores, April was expected to be the month where real progress was to be made with regard to new licenses issuances and store openings. But with COVID-19 shutting down in-store access, progress on easing a massive product supply bottleneck in Ontario has come to a grinding halt.
Image source: Getty Images.
But wait -- there's more
Mind you, the partial shutdown of marijuana dispensaries in Ontario isn't the only adverse impact from the coronavirus. It's merely the latest domino to fall.
One the biggest issues that Canadian licensed producers (LPs) like Canopy Growth, Aurora Cannabis, and HEXO have had to contend with is supply chain disruption caused by COVID-19. More recently, the shutdown of nonessential businesses represents a direct threat to the needs of cultivators and pot retailers throughout Canada. But even before mitigation measures for the coronavirus became commonplace in Canada, LPs were dealing with shutdowns throughout parts of mainland China in late 2019 and the early portion of 2020. China is the primary source of vaporizer pen and vape accessories, and it's also a common source to purchase lightning and ventilation equipment used in cultivation.
The coronavirus also put an end to a handful of trade shows that were supposed to take place in Canada. Trade shows are the perfect platform for LPs to show off new products, and can even be a place to forge distribution deals.
We've also witnessed COVID-19 bring international and domestic travel to a near halt. For popular Canadian destinations, such as Vancouver in British Columbia or Toronto in Ontario, it means even less opportunity to sell legal cannabis.
The Canadian pot industry was already troubled well before the coronavirus came along. Unfortunately, it's become the gut punch that pot stocks simply didn't need.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Sean Williams has no position in any of the stocks mentioned. The Motley Fool recommends HEXO. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | For example, Aurora Cannabis (NYSE: ACB) wound up grossly overspending on capacity, pushing its goodwill up to nearly $3.2 billion Canadian at one point. In terms of regulatory issues, Health Canada was slow to approve cultivation and sales license applications, and delayed the launch of high-margin derivatives, such as edibles, beverages, and vapes, by two months. Aurora has since laid off 500 workers, halted construction on two of its largest projects, and planned to sell another greenhouse that was expected to play a major role in production, once retrofit for cannabis plants. | For example, Aurora Cannabis (NYSE: ACB) wound up grossly overspending on capacity, pushing its goodwill up to nearly $3.2 billion Canadian at one point. Just this past week, Ontario's provincial regulators announced that cannabis shops were not considered essential services, and were thus forced to close for two weeks, as of 11:59pm EDT on April 4. The dispensary closure announcement wound up hitting Canopy Growth (NYSE: CGC), the largest marijuana stock by market cap, particularly hard given its physical retail presence in Ontario. | For example, Aurora Cannabis (NYSE: ACB) wound up grossly overspending on capacity, pushing its goodwill up to nearly $3.2 billion Canadian at one point. A trio of problems have plagued the Canadian marijuana industry On Oct. 17, 2018, Canada officially became the first industrialized country in the modern era to allow for the sale of adult-use marijuana. The expectation at the time from Wall Street analysts was that Canadian demand would quickly build to between 800,000 kilos and 1 million kilos per year, with Canadian marijuana stocks turning the corner to profitability toward the end of calendar year 2019. | For example, Aurora Cannabis (NYSE: ACB) wound up grossly overspending on capacity, pushing its goodwill up to nearly $3.2 billion Canadian at one point. Meanwhile, provincial regulators in Ontario utilized a lottery system to assign dispensary licenses until the end of 2019, resulting in far too few store openings and a supply bottleneck in Canada's most-populous province. The Canadian pot industry was already troubled well before the coronavirus came along. |
37575.0 | 2020-04-08 00:00:00 UTC | Coronavirus Market Crash: 2 Cannabis Stocks to Avoid | ACB | https://www.nasdaq.com/articles/coronavirus-market-crash%3A-2-cannabis-stocks-to-avoid-2020-04-08 | nan | nan | As a result of the recent market correction, many stocks are much cheaper than they were just a few months ago. However, just because a stock is cheap doesn't necessarily mean it's a buy. While now may be an opportune time to buy shares of great businesses with solid prospects, there are many stocks investors should avoid no matter how cheap they seem to be. In particular, here are two cannabis companies I think investors had better stay away from: Aurora Cannabis (NYSE: ACB) and Hexo (NYSE: HEXO).
Aurora Cannabis
Last year, shares of Aurora Cannabis plunged by 56.5%; that was even worse than the industry benchmark, the Horizons Marijuana Life Sciences Index ETF (OTC: HMLSF), which slid by about 36% over the same time. Unfortunately for Aurora, so far, 2020 hasn't been much better: The company's shares are down by 63% year to date. At writing, Aurora's stock is worth a mere $0.81. However, investors shouldn't be fooled into thinking Aurora is a buy at current levels. Let's consider two reasons why the pot grower is not worth the trouble.
Image Source: Getty Images.
First, the company continues to record poor financial performance. Aurora's latest earnings report -- which was for the second quarter of its fiscal year 2020 -- was nothing short of a dumpster fire. The company's net revenue was 56 million Canadian dollars, representing a 25.5% sequential decrease. Aurora recorded a loss from operations of CA$119.6 million and a net loss of CA$1.3 billion. And the company's performance in the first quarter wasn't much better.
Second, there's Aurora's ugly balance sheet. In particular, the company has an abnormal amount of goodwill (intangible assets). During the second quarter, Aurora's goodwill was CA$2.4 billion. Aurora may have to incur significant write-downs in the future, which would hurt its bottom line. And considering the company is far from profitable, this is something investors should keep in mind. That is why despite the recent opening of the cannabis derivative market in Canada, I think investors should stay away from Aurora Cannabis.
Hexo
Hexo has been a hot mess in recent weeks, and not just because the company's stock is down 57% since the beginning of the year. On March 17, Hexo announced that the release of its earnings report for the second quarter of its fiscal year 2020 would be delayed. The delay was because Hexo had failed to file its "interim financial statements and related management's discussion and analysis" by the appropriate deadline. This wasn't the first time the company's quarterly financial report was delayed, either -- something similar happened with Hexo's fourth-quarter earnings report for fiscal 2019.
With that said, though, I believe Hexo has to contend with much bigger problems than just this delay. For instance, the pot grower's actual financial results continue to be unimpressive. During the second quarter, Hexo reported a net loss of CA$298.2 million, its deepest quarterly net loss ever. And although Hexo reported a net revenue of CA$17 million -- representing a 17% sequential increase -- investors weren't pleased with the company's performance, and Hexo's shares plunged on the heels of its earnings release.
Another reason to stay away from Hexo is the fact that the pot grower has been heavily resorting to dilutive forms of financing recently. In October, the company decided to launch a round of funding (which closed in December) during which Hexo raised CA$70 million by issuing convertible debentures. The cannabis company then started another round of financing in late December, raising CA$25 million by issuing new shares; this round of financing closed in early January. Lastly, Hexo raised another CA$20 million in January by issuing new shares once again. Hexo's latest round of funding closed Jan. 22.
Hexo is probably not done with these dilutive forms of financing. In its press release announcing its second-quarter financial results, the company said the following: "Management estimates that the working capital as [of] January 31, 2020 and forecasted cash flows will require additional capitalization in order to meet the Company's obligations, commitments and budgeted expenditures through January 31, 2021." Share dilution problems will keep plaguing Hexo in the future; coupled with the company's poor financial results, this makes its stock unattractive. In short, investors had better keep their distances from Hexo, despite its shares going for less than a dollar apiece at the moment.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Prosper Junior Bakiny owns shares of Aurora Cannabis Inc. The Motley Fool recommends HEXO. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | In particular, here are two cannabis companies I think investors had better stay away from: Aurora Cannabis (NYSE: ACB) and Hexo (NYSE: HEXO). In October, the company decided to launch a round of funding (which closed in December) during which Hexo raised CA$70 million by issuing convertible debentures. Share dilution problems will keep plaguing Hexo in the future; coupled with the company's poor financial results, this makes its stock unattractive. | In particular, here are two cannabis companies I think investors had better stay away from: Aurora Cannabis (NYSE: ACB) and Hexo (NYSE: HEXO). During the second quarter, Hexo reported a net loss of CA$298.2 million, its deepest quarterly net loss ever. And although Hexo reported a net revenue of CA$17 million -- representing a 17% sequential increase -- investors weren't pleased with the company's performance, and Hexo's shares plunged on the heels of its earnings release. | In particular, here are two cannabis companies I think investors had better stay away from: Aurora Cannabis (NYSE: ACB) and Hexo (NYSE: HEXO). Hexo Hexo has been a hot mess in recent weeks, and not just because the company's stock is down 57% since the beginning of the year. And although Hexo reported a net revenue of CA$17 million -- representing a 17% sequential increase -- investors weren't pleased with the company's performance, and Hexo's shares plunged on the heels of its earnings release. | In particular, here are two cannabis companies I think investors had better stay away from: Aurora Cannabis (NYSE: ACB) and Hexo (NYSE: HEXO). That is why despite the recent opening of the cannabis derivative market in Canada, I think investors should stay away from Aurora Cannabis. Another reason to stay away from Hexo is the fact that the pot grower has been heavily resorting to dilutive forms of financing recently. |
37576.0 | 2020-04-07 00:00:00 UTC | Is Marijuana Stock Aurora Cannabis Headed to $0? | ACB | https://www.nasdaq.com/articles/is-marijuana-stock-aurora-cannabis-headed-to-%240-2020-04-07 | nan | nan | If you think the past seven weeks have been ugly for investors, narrow your focus a bit and take a gander at cannabis stocks.
Through the first quarter of last year, more than dozen marijuana stocks had gained at least 70% over a three-month period, and sales projections for legal cannabis kept creeping higher. Then, the bubble burst, with most pot stocks losing anywhere from 50% to 95% of their value over the past 12-plus months.
Perhaps the poster child of the boom-bust nature of cannabis investing is Aurora Cannabis (NYSE: ACB). Aurora, the most popular stock by a long-shot on millennial-focused online investing app Robinhood, has lost approximately 92% of its value since mid-March 2019. Now valued at a mere $0.80 per share (albeit still equating to a $960 million market cap), the question has to be raised: Could Aurora Cannabis go to $0?
Image source: Getty Images.
Aurora Cannabis was once pegged for greatness
At one time, Aurora's outlook was promising. The company had 15 prospective cultivation sites around the world with a peak annual run-rate that was likely nearing 700,000 kilos. Inclusive of Canada, the company also had a production, research, export, or collaborative presence in 25 countries. Both the peak production potential and overseas reach were far and away tops in the marijuana industry. Having two dozen international markets at its disposal was designed to ensure that domestic oversupply never became a problem.
Aurora Cannabis also wound up hiring billionaire activist investor Nelson Peltz as a strategic advisor in March 2019. Peltz has a long history of investing in food and beverage companies, which made him the perfect individual to potentially bridge a partnership or equity investment with a brand-name consumer-packaged goods company. This hiring came just months after Constellation Brands sunk $4 billion into Canopy Growth as an equity investment, and Altria Group purchased a 45% stake in Cronos Group for $1.8 billion.
Then there was Aurora's management commentary, with longtime (and now-former) CEO Terry Booth predicting at least 625,000 kilos of run-rate output by the end of the company's fiscal 2020 year (June 30, 2020), and a real chance at positive adjusted EBIDTA by the end of calendar year 2019.
It all looked great on paper, but not one lick of this vision is still in play today.
Image source: Getty Images.
Absolutely nothing has gone right for the most popular pot stock
In November, Aurora Cannabis announced that it would be halting construction on two of its largest production farms (Aurora Sun in Alberta and Aurora Nordic 2 in Denmark) in order to conserve capital. Not long thereafter, the company placed the 1-million-square-foot Exeter greenhouse on the sale block for about $17 million Canadian. Exeter is a vegetable-growing greenhouse acquired in the MedReleaf purchase that Aurora has yet to retrofit for cannabis production. These construction halts, and the presumed sale of Exeter, essentially takes more than 400,000 kilos of peak annual output off the table.
As for Peltz, his signing as a strategic advisor has resulted in absolutely nothing. With the exception of landing a role as a supplier for PAX Labs Era vaping device, Aurora Cannabis hasn't attracted a brand-name partner, nor has it received a coveted equity investment.
And as for those visions of positive adjusted EBITDA, they've been thrown completely out the window. In fact, the real question, after perusing Aurora's balance sheet, is whether it has the ability to even survive?
On one hand, Aurora's overzealous acquisition strategy has left it with a mountain of goodwill – i.e., it grossly overpaid for the companies it acquired. Even after writing down CA$762 million in goodwill in the most recent quarter, Aurora's remaining CA$2.41 billion in goodwill dwarfs its market cap. In my view, additional writedowns are almost certainly coming.
Image source: Getty Images.
On the other hand, the company's available cash looks wholly insufficient to cover its upcoming expenses. In mid-February, when Aurora filed its fiscal second quarter management discussion and analysis, the company forecast expected liabilities over the next 12 months of CA$373.6 million. This compares to CA$156.3 million in cash and cash equivalents and CA$26.1 million in marketable securities. The company is really down to its final option of late, which has been to issue stock like Monopoly money to raise capital. That's why the company's outstanding share count has ballooned to 1.17 billion from 16 million in about 5.5 years.
Making matters worse, selling assets may not net Aurora Cannabis the capital it needs to cover its expenses. Although it lists CA$1 billion in property, plant, and equipment on its balance sheet, the retail market for cultivation and processing assets is grim throughout Canada given the regulatory supply bottlenecks plaguing the country. Translation: Aurora Cannabis is really short of ways to raise money, aside from continuing to issue its own common stock.
But does this lack of cash mean it's going to $0? While I remain decisively bearish on Aurora Cannabis and believe it should be avoided by investors at all costs, the company's ability to halt cultivation activity, shed more jobs, and continue to issue stock at the detriment of its shareholders, will likely keep it from going to $0. However, without a stroke of good fortune in the near future, delisting from the New York Stock Exchange and further downside will await.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Sean Williams has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Constellation Brands. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Perhaps the poster child of the boom-bust nature of cannabis investing is Aurora Cannabis (NYSE: ACB). With the exception of landing a role as a supplier for PAX Labs Era vaping device, Aurora Cannabis hasn't attracted a brand-name partner, nor has it received a coveted equity investment. Although it lists CA$1 billion in property, plant, and equipment on its balance sheet, the retail market for cultivation and processing assets is grim throughout Canada given the regulatory supply bottlenecks plaguing the country. | Perhaps the poster child of the boom-bust nature of cannabis investing is Aurora Cannabis (NYSE: ACB). Now valued at a mere $0.80 per share (albeit still equating to a $960 million market cap), the question has to be raised: Could Aurora Cannabis go to $0? Then there was Aurora's management commentary, with longtime (and now-former) CEO Terry Booth predicting at least 625,000 kilos of run-rate output by the end of the company's fiscal 2020 year (June 30, 2020), and a real chance at positive adjusted EBIDTA by the end of calendar year 2019. | Perhaps the poster child of the boom-bust nature of cannabis investing is Aurora Cannabis (NYSE: ACB). Then there was Aurora's management commentary, with longtime (and now-former) CEO Terry Booth predicting at least 625,000 kilos of run-rate output by the end of the company's fiscal 2020 year (June 30, 2020), and a real chance at positive adjusted EBIDTA by the end of calendar year 2019. Absolutely nothing has gone right for the most popular pot stock In November, Aurora Cannabis announced that it would be halting construction on two of its largest production farms (Aurora Sun in Alberta and Aurora Nordic 2 in Denmark) in order to conserve capital. | Perhaps the poster child of the boom-bust nature of cannabis investing is Aurora Cannabis (NYSE: ACB). Not long thereafter, the company placed the 1-million-square-foot Exeter greenhouse on the sale block for about $17 million Canadian. This compares to CA$156.3 million in cash and cash equivalents and CA$26.1 million in marketable securities. |
37577.0 | 2020-04-07 00:00:00 UTC | Why the Picture for Aurora Cannabis Just Got Bleaker | ACB | https://www.nasdaq.com/articles/why-the-picture-for-aurora-cannabis-just-got-bleaker-2020-04-07 | nan | nan | There's been nothing but bad news for Aurora Cannabis (NYSE: ACB) lately. The Canadian cannabis producer posted dismal fiscal 2020 Q2 results in February. Its longtime CEO stepped down. Aurora laid off staff. Its stock is down more than 60% year to date.
And now the picture for Aurora just got bleaker. One of the biggest problems for the company in 2019 became worse over the weekend.
Image source: Getty Images.
The dreaded word
Canada's most heavily populated province, Ontario, shut down all retail cannabis stores effective 11:59 p.m. on April 4. Ontario's government now classifies cannabis stores under the dreaded word "nonessential."
The province had previously designated cannabis stores as essential businesses with its response to the coronavirus pandemic announced on March 24. Essential businesses were allowed to stay open, while nonessential businesses were required to close.
However, Ontario Premier Doug Ford announced on April 3 that further steps were needed to slow the spread of the novel coronavirus and limit the cases of COVID-19. He stated that the province had to take "additional steps to flatten the curve" by "announcing the closure of many more sectors of the economy." Ford added, "I can tell you this was no easy task."
The shutdown will extend through April 18. However, it remains to be seen if the closures of non-essential businesses will be extended for an even longer period.
Why it hits Aurora especially hard
Aurora Cannabis hasn't been shy in the past at pointing the finger at Ontario's inadequate number of retail cannabis stores as a big reason its revenue growth hasn't been as high as it expected. For at least the next couple of weeks, the big province won't have any retail cannabis stores open. Aurora's only venue for selling cannabis products in the province will be online through the Ontario Cannabis Store.
Obviously, the situation in Ontario affects many other Canadian cannabis producers as well. But it will hit Aurora especially hard, particularly as compared with Canopy Growth (NYSE: CGC) and Cronos Group (NASDAQ: CRON), because of Aurora's precarious cash position.
Aurora is already burning through cash quickly, even with its efforts to reduce capital spending and cut back staffing costs. The company had a little over $201 million Canadian in cash, cash equivalents, and restricted cash at the end of 2019. That's not enough to fund operations for very long, and particularly with what's sure to be lower cannabis sales in Ontario with the retail store closures.
Canopy Growth and Cronos Group have much larger cash positions. They also have big partners with deep pockets. Largely because of Aurora's past strategy of trying to remain independent without taking on an equity partner, it's in a more vulnerable position than these rivals.
Is there a light at the end of the tunnel for Aurora?
Maybe, just maybe, Ontario's cannabis stores will reopen this month. If the number of COVID-19 cases in Canada began to really fall off, it's possible that cannabis sales will pick up this summer.
Ontario had previously committed to issuing more licenses for retail cannabis stores before the coronavirus pandemic. If the province quickly resumes those efforts, the addition of those stores could benefit Aurora Cannabis and other Canadian marijuana stocks this year.
Canada's cannabis derivatives products market could also gain momentum. Aurora has already launched vape and edible products and still hopes that this market will be a significant driver of revenue growth.
It's possible that there is a light at the end of the tunnel for Aurora. But with the company's financial woes, the present reality for Aurora remains pretty dark for now.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Keith Speights has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | There's been nothing but bad news for Aurora Cannabis (NYSE: ACB) lately. The dreaded word Canada's most heavily populated province, Ontario, shut down all retail cannabis stores effective 11:59 p.m. on April 4. If the province quickly resumes those efforts, the addition of those stores could benefit Aurora Cannabis and other Canadian marijuana stocks this year. | There's been nothing but bad news for Aurora Cannabis (NYSE: ACB) lately. Why it hits Aurora especially hard Aurora Cannabis hasn't been shy in the past at pointing the finger at Ontario's inadequate number of retail cannabis stores as a big reason its revenue growth hasn't been as high as it expected. But it will hit Aurora especially hard, particularly as compared with Canopy Growth (NYSE: CGC) and Cronos Group (NASDAQ: CRON), because of Aurora's precarious cash position. | There's been nothing but bad news for Aurora Cannabis (NYSE: ACB) lately. Why it hits Aurora especially hard Aurora Cannabis hasn't been shy in the past at pointing the finger at Ontario's inadequate number of retail cannabis stores as a big reason its revenue growth hasn't been as high as it expected. Aurora's only venue for selling cannabis products in the province will be online through the Ontario Cannabis Store. | There's been nothing but bad news for Aurora Cannabis (NYSE: ACB) lately. Aurora's only venue for selling cannabis products in the province will be online through the Ontario Cannabis Store. The company had a little over $201 million Canadian in cash, cash equivalents, and restricted cash at the end of 2019. |
37578.0 | 2020-04-05 00:00:00 UTC | There Are Big Changes Coming to the Cannabis Industry in 2020 | ACB | https://www.nasdaq.com/articles/there-are-big-changes-coming-to-the-cannabis-industry-in-2020-2020-04-05 | nan | nan | Marijuana stocks had a rough 2019. The Horizons Marijuana Life Sciences ETF (OTC: HMLSF) fell 39% last year as the S&P 500 rose by 29%. The honeymoon stage for the cannabis industry is long over. And although the outbreak of the coronavirus isn't going to do the industry any favors this year, the reality is that marijuana stocks were going to face problems in 2020 either way. It's a year that will separate the pretenders from those that will be around for years, and it's not going to be an easy one for many companies. Here are some of the things investors can expect to see in 2020.
Layoffs and cost reductions wherever possible
Aurora Cannabis (NYSE: ACB) made headlines in February when it announced that not only would CEO Terry Booth be stepping down, but also that it would be cutting 500 jobs. It also wrote down more than one billion Canadian dollars' worth of assets, including goodwill, from its balance sheet. It was a big blow for the pot stock, which was once a key rival of industry leader Canopy Growth (NYSE: CGC). And even Canopy Growth had its own round of layoffs, when it announced in early March that it would be letting go of 500 workers and shutting down two of its greenhouses.
These are two of the bigger, more notable cannabis companies in the industry, and these decisions happened before the coronavirus pandemic really took center stage. That means we've likely seen just the first wave of job cuts, as companies in the industry are going to face even more pressure to trim their costs as much as they can in what's likely to be a very difficult year for economies around the world.
Image source: Getty Images.
Smaller cannabis companies are facing even bigger problems, as many are still in their early growth stages. Raising cash, for instance, is going to be more difficult going forward. To say that investors are bearish on pot stocks would be a gross understatement, as 90% stock losses over the past year aren't uncommon.
ACB data by YCharts
That's where being self-sufficient and keeping costs down is going to be more important than ever before.
Bankruptcies
In February, Kentucky-based hemp producer GenCanna filed for bankruptcy . And that may be just the first of many this year for the industry.
A full year of legal edibles and ingestibles in Canada, along with more states in the U.S. legalizing pot, was supposed to make 2020 a stronger year for the cannabis industry. But with the coronavirus pandemic creating job losses and lots of instability in the economy, the recreational market for pot is bound to suffer. And with revenue growth out of the question, the one option left for companies who need to conserve cash is to continue slashing their costs.
That's why more layoffs are likely in the future, and cannabis companies will need to operate tighter ships if they want to be operating at all. But the problem is that there may not be enough time. Investment bank Ello Capital already saw many cannabis companies struggling with liquidity pre-coronavirus -- in February, for example, it calculated that Aurora may only have enough cash on hand to continue operating for a little more than two months.
Bankruptcy may be the only option at this point, as companies are moving away from acquisitions rather than pursuing them, despite the potential targets' low valuations. Harvest Health & Recreation (OTC: HRVSF) announced on March 26 that it was walking away from an $850 million acquisition of Verano Holdings. The companies initially announced the deal in March 2019, but both companies have since agreed to abandon it, blaming the challenges in getting the necessary regulatory approvals and "current market conditions."
Although valuations may be low, companies have to be extra careful in deciding where to spend their limited cash. And issuing shares at a time when pot stocks are crashing is not going to win over many investors, either. That's why there may not be many mergers and acquisitions this year to bail out struggling pot stocks -- again, leaving bankruptcy as possibly the only option.
A good example of that is CannTrust Holdings (NYSE: CTST), which entered creditor protection on March 31. The company acknowledged that its shares will likely soon be delisted from both the NYSE and the TSX. CannTrust's fall was predictable, given that Health Canada suspended its license to sell pot last year after officials found that about its illegal growing operations. But what may be more surprising is that no one acquired the company for its assets. Aphria (NYSE: APHA) did show an interest in CannTrust's assets, but nothing materialized from that.
What does this mean for investors?
The days of cannabis companies aggressively pursuing growth opportunities and acquisitions in Europe or even North America are likely long gone, at least for now. Whether it's because of the coronavirus or a desire to keep costs down, growth is not something cannabis producers will be able to focus on moving forward. This year could be a critical one for the industry, as many companies could go under if they're not able to trim enough costs from their financials to become sustainable.
The safest route for investors at this point is to hold off investing in any pot stock until the dust clears and the coronavirus pandemic is under control. It could be a hectic year, and while some pot stocks could double if they can weather the storm, there are others that are likely to file for bankruptcy.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
David Jagielski has no position in any of the stocks mentioned. The Motley Fool recommends CannTrust Holdings Inc. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Layoffs and cost reductions wherever possible Aurora Cannabis (NYSE: ACB) made headlines in February when it announced that not only would CEO Terry Booth be stepping down, but also that it would be cutting 500 jobs. ACB data by YCharts That's where being self-sufficient and keeping costs down is going to be more important than ever before. Investment bank Ello Capital already saw many cannabis companies struggling with liquidity pre-coronavirus -- in February, for example, it calculated that Aurora may only have enough cash on hand to continue operating for a little more than two months. | Layoffs and cost reductions wherever possible Aurora Cannabis (NYSE: ACB) made headlines in February when it announced that not only would CEO Terry Booth be stepping down, but also that it would be cutting 500 jobs. ACB data by YCharts That's where being self-sufficient and keeping costs down is going to be more important than ever before. Smaller cannabis companies are facing even bigger problems, as many are still in their early growth stages. | Layoffs and cost reductions wherever possible Aurora Cannabis (NYSE: ACB) made headlines in February when it announced that not only would CEO Terry Booth be stepping down, but also that it would be cutting 500 jobs. ACB data by YCharts That's where being self-sufficient and keeping costs down is going to be more important than ever before. That means we've likely seen just the first wave of job cuts, as companies in the industry are going to face even more pressure to trim their costs as much as they can in what's likely to be a very difficult year for economies around the world. | Layoffs and cost reductions wherever possible Aurora Cannabis (NYSE: ACB) made headlines in February when it announced that not only would CEO Terry Booth be stepping down, but also that it would be cutting 500 jobs. ACB data by YCharts That's where being self-sufficient and keeping costs down is going to be more important than ever before. And that may be just the first of many this year for the industry. |
37579.0 | 2020-04-03 00:00:00 UTC | 3 Extremely Popular Stocks to Avoid Like the Plague in April | ACB | https://www.nasdaq.com/articles/3-extremely-popular-stocks-to-avoid-like-the-plague-in-april-2020-04-03 | nan | nan | To be blunt, the past six weeks haven't been pretty for investors. Fear and uncertainty surrounding the spread of the coronavirus disease 2019 (COVID-19) has squashed equities and sent the stock market tumbling into bear market territory faster than at any point in its long history. With the scope of the economic damage caused by mitigation measures to slow the spread of COVID-19 still unknown, there could be further downside to come.
Then again, bear markets are historically a good thing. That's because they've always represented an opportune time for long-term investors to buy into sound businesses for the long run. Eventually, all bear markets have been completely erased by a bull-market rally.
Image source: Getty Images.
Unfortunately, not every company can be a winner. And when it comes to investing, it's important to remember that popular stocks aren't always profitable stocks.
With this being said, here are three extremely popular stocks with investors that should be avoided like the plague in April (and beyond).
Aurora Cannabis
Marijuana stock Aurora Cannabis (NYSE: ACB) isn't just a popular stock -- it's by far the most popular stock held by millennials on online investing app Robinhood. According to a forecast at the midpoint of 2019, this Canadian licensed pot producer was on track to produce 625,000 kilos of weed on an annual run-rate basis by the end of June 2020. Plus, billionaire Nelson Peltz was hired as a strategic advisor in March 2019, and a brand-name partnership was expected.
However, neither of these prognostications have come true or mattered for Aurora Cannabis, which has been nothing short of a dumpster fire. The company has halted production at two of its largest grow farms (Aurora Sun and Aurora Nordic 2) and plans to sell the 1 million-square-foot Exeter greenhouse that it acquired with the $2 billion MedReleaf acquisition. Exeter was expected to generate 105,000 kilos per year when retrofit to cannabis production.
All told, Aurora's peak output has been slashed by more than 400,000 kilos per year (at least for now), and the company has landed no major partners.
Image source: Getty Images.
What's even worse than sales forecasts badly missing the mark is the company's balance sheet. Aurora Cannabis ended 2019 with $156.3 million Canadian in cash and cash equivalents and CA$26.1 million in marketable securities, but outlined CA$373.6 million in expected liabilities over the next year in its management discussion and analysis filing with SEDAR. In other words, there could be a serious cash crunch brewing, even with the outlined reduction in production.
Also, Aurora's overzealous expansion efforts led it to grossly overpay for its acquisitions. Even after a monstrous CA$762.2 million goodwill writedown in the fiscal second quarter, the company is still lugging around CA$2.41 billion in goodwill, accounting for 52% of total assets.
Aurora Cannabis' operating losses are expected to continue and it has an abysmal balance sheet. Investors would be wise to steer clear.
American Airlines Group
Another popular stock among investors that's gained a lot of interest of late is American Airlines Group (NASDAQ: AAL).
American Airlines has been pulverized by the COVID-19 outbreak, as has the entire airline industry. However, the passage of the CARES Act -- that's the Coronavirus Aid, Relief, and Economic Security (CARES) Act -- apportions up to $50 billion to passenger airline companies as a form of bailout to keep them afloat and keep their staffs from being laid off.
This $50 billion parachute from the federal government has investors feeling a lot better about the airline industry, and American in particular. But this optimism is likely misplaced.
Image source: American Airlines.
I'll admit that, with very few exceptions, I'm not a fan of the airline industry. It's an exceptionally capital-intensive industry that often yields mind-numbingly thin margins and has shown time and time again that it doesn't fare well during recessions. And almost every airline dips deeply into debt to broaden and modernize their fleets.
In American Airlines' case, the company absolutely ballooned its debt load to modernize its fleet and wound up retiring planes that my Foolish colleague Adam Levine-Weinberg noted were far from needing replacement. The end result is that American is the most debt-burdened major of the group, with close to $30 billion in net debt. This is a deep hole from which I'm not certain it can dig itself out.
Furthermore, as one of the conditions of the CARES Act airline bailout, airlines will be prevented from buying back their own stock. The $11.9 billion American Airlines spent on buybacks over the past five years might be the only positive thing going for this company. Without buybacks and with dividends on the chopping block, major airlines are giving investors no reason to buy them -- especially the worst of the bunch.
Tesla
Lastly, hold the hate mail, but despite Tesla's (NASDAQ: TSLA) popularity, I believe it's worth avoiding the electric-vehicle (EV) manufacturer like the plague in April and for the foreseeable future.
On one hand, Tesla has a pretty long list of people it's proved wrong over the past decade. Clearly, CEO Elon Musk is a genuine asset for the company, and he's done something that hasn't been done in about five decades -- namely, build a brand new, mass-produced auto company from the ground up. But I don't believe Musk being a visionary is going to be enough to justify a $93 billion valuation in this economic environment.
A Tesla Model S plugged in to charge. Image source: Tesla.
Putting aside the fact that the company has shut down production at its Fremont factory per California's mandated shelter-in-place order, one of the bigger concerns I have following the coronavirus crash is how Tesla is going to compete with plunging prices at the pump. Crude oil recently hit 18-year lows, which'll soon make it cheaper than it's been in a long time to fuel up trucks, SUVs, and sedans.
The comparative advantage on price over fossil fuels has arguably been Tesla's biggest edge for the past decade, but in one fell swoop it's disappeared. This isn't to say that there won't be buyers who prefer greener options so much as to say that at least some percentage of the customer pool will now be lost due to much lower gasoline prices.
This is notable because Tesla very much needs rapid growth to produce an income statement that justifies a $93 billion valuation. Only recently did Tesla cross the 1 million-vehicle mark since the release of its first EV in 2008, which is a production figure that many of its gas-powered competitors can produce in less than two months. Although Tesla has benefited frequently from zero-emission vehicle credits, the fact is that the company still hasn't produced a generally accepted accounting principles (GAAP) profit on an annual basis.
Other factors to consider here are Elon Musk's poor track record of meeting timelines when introducing new vehicles, as well as Tesla's awful acquisition of SolarCity, which has been losing money hand over fist.
Tesla has remained irrational longer than the naysayers have been able to stay solvent, but a recession just might be what opens investors' eyes.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Aurora Cannabis Marijuana stock Aurora Cannabis (NYSE: ACB) isn't just a popular stock -- it's by far the most popular stock held by millennials on online investing app Robinhood. In American Airlines' case, the company absolutely ballooned its debt load to modernize its fleet and wound up retiring planes that my Foolish colleague Adam Levine-Weinberg noted were far from needing replacement. Putting aside the fact that the company has shut down production at its Fremont factory per California's mandated shelter-in-place order, one of the bigger concerns I have following the coronavirus crash is how Tesla is going to compete with plunging prices at the pump. | Aurora Cannabis Marijuana stock Aurora Cannabis (NYSE: ACB) isn't just a popular stock -- it's by far the most popular stock held by millennials on online investing app Robinhood. Aurora Cannabis ended 2019 with $156.3 million Canadian in cash and cash equivalents and CA$26.1 million in marketable securities, but outlined CA$373.6 million in expected liabilities over the next year in its management discussion and analysis filing with SEDAR. However, the passage of the CARES Act -- that's the Coronavirus Aid, Relief, and Economic Security (CARES) Act -- apportions up to $50 billion to passenger airline companies as a form of bailout to keep them afloat and keep their staffs from being laid off. | Aurora Cannabis Marijuana stock Aurora Cannabis (NYSE: ACB) isn't just a popular stock -- it's by far the most popular stock held by millennials on online investing app Robinhood. American Airlines Group Another popular stock among investors that's gained a lot of interest of late is American Airlines Group (NASDAQ: AAL). * David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and Tesla wasn't one of them! | Aurora Cannabis Marijuana stock Aurora Cannabis (NYSE: ACB) isn't just a popular stock -- it's by far the most popular stock held by millennials on online investing app Robinhood. Image source: American Airlines. The $11.9 billion American Airlines spent on buybacks over the past five years might be the only positive thing going for this company. |
37580.0 | 2020-04-02 00:00:00 UTC | Aurora Cannabis (ACB): A Real Lift or a Dead Cat Bounce? | ACB | https://www.nasdaq.com/articles/aurora-cannabis-acb%3A-a-real-lift-or-a-dead-cat-bounce-2020-04-02 | nan | nan | In mid-March, Aurora Cannabis (ACB) hit a 52-week low of $0.60 per share, with some commentators believing it hadn't hit bottom yet. While it appears a bottom is in, the question going forward is whether or not the company can hold on to some of its recent gains.
After hitting its bottom, a little over a week later the company soared to over $1.13 per share, pulling back to $0.85 per share as I write.
In this article we'll look at whether or not the company will be able to sustain or increase these gains, and what it would take to do so.
The key factor in the near term
Without a doubt the key to short-term growth for Aurora is recreational sales in Canada. If it is able to do well there, it will surprise the market to the upside and give its share price another boost that would have a good chance to hold if there are no negative surprises in its next earnings report.
If Aurora is able to match last quarter's recreational pot revenue, it should exceed it by at least several million because of the inclusion of derivative sales in this quarter; that means higher revenue, margins and earnings from those sales. Another element would be if it is able to attract new customers to derivatives, which would represent a significant increase in its performance if the new customers represent meaningful numbers in the reporting period.
Add to that the gradual increase in retail outlets to sell in, and it points to a possible solid win in this quarter. The caveat will be if it is in fact able to at least sell as much recreational pot as it did last quarter; that's not a guarantee, so we'll have to wait and see if the increase in stores and sales of derivatives will allow it to exceed recreational pot sales expectations.
On the positive side, if it is able to generate the same number of sales with recreational pot without derivative sales, it could surprise to the upside in a big way. That could happen if it is able to regain some Canadian market share.
The negative catalyst would be if coronavirus ends up having a detrimental impact on Canadian sales.
International sales
After dropping the ball last quarter in regard to licensing in Germany, the company temporarily lost some business until it met German requirements. With that behind them, there is no doubt Aurora will win back that business, although it could take a couple of quarters to do so.
What it means is revenue from international sales in the last quarter should rebound, and combined with the potential increase in recreational sales, would add more fuel to the fire.
Over the long term Aurora Cannabis will be one of the international market leaders in the cannabis sector, but for now it'll take time to build that business out.
Eventually I think this will be the best performing segment Aurora competes in.
Consensus Verdict
Most of Wall Street is surveying the cannabis player from the sidelines, with TipRanks analytics demonstrating ACB as a Hold. Based on 16 analysts polled in the last 3 months, only 1 say "buy," while 11 suggest "hold," and 4 recommend "sell." That said, the 12-month average price target still stands at $1.69, which marks about 96% upside from where the stock is currently trading. (See Aurora Cannabis stock analysis on TipRanks)
Conclusion
As has been the case in the recent past, some of the things having a negative effect on Aurora Cannabis and its Canadian peers remain in place, and that has been potentially worsened with the emergence of coronavirus.
I don't think coronavirus will have an impact on sales to long-term cannabis users, but it may slow down the number of new users entering the market. That could undermine the company in the near term because it's highly probable that derivatives will be more palatable to new users who don't want the perceived stigma that smoking or vaping cannabis would have on them. The company has said about 20 percent of its sales in this quarter are from derivatives, which based upon sales from last quarter, would be over $7 million.
If it is exceeding last quarter's sales, that number could be higher.
How this will play out is Aurora is partially reliant on growth from opening new retail stores in Canada, and should grow nicely in conjunction with the openings.
Whether or not coronavirus has had a lot of impact on the performance of Aurora won't be known until the earnings report. So far it hasn't been suggested that has been the case, but it should be considered a probability.
If the things outlined in this article go right for Aurora, it will surprise the market to the upside in the short term, and would lay a foundation for incremental, sustainable growth.
As the number of retail stores multiply and international sales climb, Aurora's future prospects look bright, as it has the potential to quickly ramp up production with the production facilities it can quickly bring on line and complete construction on.
To find good ideas for cannabis stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | In mid-March, Aurora Cannabis (ACB) hit a 52-week low of $0.60 per share, with some commentators believing it hadn't hit bottom yet. Consensus Verdict Most of Wall Street is surveying the cannabis player from the sidelines, with TipRanks analytics demonstrating ACB as a Hold. International sales After dropping the ball last quarter in regard to licensing in Germany, the company temporarily lost some business until it met German requirements. | In mid-March, Aurora Cannabis (ACB) hit a 52-week low of $0.60 per share, with some commentators believing it hadn't hit bottom yet. Consensus Verdict Most of Wall Street is surveying the cannabis player from the sidelines, with TipRanks analytics demonstrating ACB as a Hold. If Aurora is able to match last quarter's recreational pot revenue, it should exceed it by at least several million because of the inclusion of derivative sales in this quarter; that means higher revenue, margins and earnings from those sales. | In mid-March, Aurora Cannabis (ACB) hit a 52-week low of $0.60 per share, with some commentators believing it hadn't hit bottom yet. Consensus Verdict Most of Wall Street is surveying the cannabis player from the sidelines, with TipRanks analytics demonstrating ACB as a Hold. If Aurora is able to match last quarter's recreational pot revenue, it should exceed it by at least several million because of the inclusion of derivative sales in this quarter; that means higher revenue, margins and earnings from those sales. | In mid-March, Aurora Cannabis (ACB) hit a 52-week low of $0.60 per share, with some commentators believing it hadn't hit bottom yet. Consensus Verdict Most of Wall Street is surveying the cannabis player from the sidelines, with TipRanks analytics demonstrating ACB as a Hold. After hitting its bottom, a little over a week later the company soared to over $1.13 per share, pulling back to $0.85 per share as I write. |
37581.0 | 2020-03-31 00:00:00 UTC | Top Cannabis Stocks Under $5 | ACB | https://www.nasdaq.com/articles/top-cannabis-stocks-under-%245-2020-03-31 | nan | nan | Investors are bullish on marijuana stocks again, and now could be the time to buy some cheap pot stocks before they take off. With the Horizons Marijuana Life Sciences ETF down more than 70% over the past year, many pot stocks are trading at their lowest levels ever. And although some have been rallying in recent days, there are still some top cannabis stocks that are trading below $5 that investors may want to add to their portfolios today.
1. Aurora Cannabis
Aurora Cannabis (NYSE: ACB) finally cracked the $1 market again on Friday, when the stock popped by double digits. The stock's disappointed investors in the past with underwhelming earnings reports, and news that it was laying off 500 positions only exacerbated investor concerns about the company's future. Aurora's facing no shortage of challenges these days, and one of the most serious is its lack of cash flow. Investment banking company Ello Capital believes that Aurora may only have a couple of months' worth of cash flow to work with, and that was in February.
But Aurora still remains a top cannabis company in the industry. It generated 56 million Canadian dollars in net revenue in the second-quarter results it released in February. Through the first two quarters of 2018 and 2019, it brought in CA$131 million in sales. And in its 2019 fiscal year, Aurora's top line of CA$248 million was nearly quadruple its prior-year tally of CA$55 million.
Image source: Getty Images.
The company's only anticipating modest growth, at best, during the third quarter. And with low expectations in place, there's potential for the stock to take off if it does well. There's new life in Aurora's stock of late, and this could be the start of a much bigger rally. A good performance in the third quarter could seal the deal and send the stock even higher.
2. Aphria
Aphria (NYSE: APHA) is arguably one of the safer pot stocks to buy. It's recorded a profit in two of its last three quarters and it's also generating much more revenue than Aurora. Aphria released its second-quarter results in January, and with more than CA$120 million in net revenue, that was nearly more than Aurora generated in two quarters combined.
But there's one reason that Aphria may not see as much of a bounce in its share price as Aurora: It hasn't fallen as hard. While Aphria's stock declined 70% in the past year, that's nothing compared to Aurora's 90% drop in price over the same period. However, with Aphria trading at around $3.50, it's well below its book value at a price-to-book multiple of 0.7 and a price-to-sales multiple of less than three. It may be one of the better bargains out there for cannabis investors. By comparison, Aurora trades at 0.5 times book value, but at six times its sales.
3. Curaleaf
Curaleaf Holdings (OTC: CURLF) was trading around $4 per share on Friday. The company's coming off the release of its year-end results on March 24, which pleasantly surprised investors as the company's revenue came in better than what analysts were expecting. Although it reported a loss of $26.6 million in the fourth quarter, its sales of $75.5 million were more than double the $32 million that Curaleaf recorded in the prior-year quarter. Analysts were only expecting revenue to reach $74.7 million in Q4. Curaleaf also reported pro forma revenue of $131.7 million, which includes pending acquisitions.
With a market cap of $1.9 billion and revenue of $221 million for 2019, investors are currently paying about 8.5 times sales for Curaleaf stock. It's also trading at five times its book value. However, given that its sales are larger than both Aurora's and Aphria's revenue numbers, and with a more lucrative U.S. market that it can tap into, investors may be more willing to pay a premium for Curaleaf shares. It's also been on a rough ride over the past year, losing more than half of its value during that time, and it could be overdue for a rally.
Which stock is the best buy today?
Despite its recent surge, Aurora Cannabis is still too big of a question mark to invest in today. From cash-flow issues to minimal growth and no profitability, there are many problems there that investors are better off not worrying about today. It's still a top cannabis stock, but it comes with some serious risks attached to it as well. Aphria is a safer buy given that it's at least proving to be more sustainable through its profits. But given the opportunities and the stronger sales numbers, Curaleaf looks to be the best cannabis stock of the three to buy today. And at a price of around $4, it could easily double with a few more good quarters under its belt.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
David Jagielski has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Aurora Cannabis Aurora Cannabis (NYSE: ACB) finally cracked the $1 market again on Friday, when the stock popped by double digits. Investment banking company Ello Capital believes that Aurora may only have a couple of months' worth of cash flow to work with, and that was in February. However, given that its sales are larger than both Aurora's and Aphria's revenue numbers, and with a more lucrative U.S. market that it can tap into, investors may be more willing to pay a premium for Curaleaf shares. | Aurora Cannabis Aurora Cannabis (NYSE: ACB) finally cracked the $1 market again on Friday, when the stock popped by double digits. It generated 56 million Canadian dollars in net revenue in the second-quarter results it released in February. Although it reported a loss of $26.6 million in the fourth quarter, its sales of $75.5 million were more than double the $32 million that Curaleaf recorded in the prior-year quarter. | Aurora Cannabis Aurora Cannabis (NYSE: ACB) finally cracked the $1 market again on Friday, when the stock popped by double digits. Investors are bullish on marijuana stocks again, and now could be the time to buy some cheap pot stocks before they take off. With a market cap of $1.9 billion and revenue of $221 million for 2019, investors are currently paying about 8.5 times sales for Curaleaf stock. | Aurora Cannabis Aurora Cannabis (NYSE: ACB) finally cracked the $1 market again on Friday, when the stock popped by double digits. And although some have been rallying in recent days, there are still some top cannabis stocks that are trading below $5 that investors may want to add to their portfolios today. The company's coming off the release of its year-end results on March 24, which pleasantly surprised investors as the company's revenue came in better than what analysts were expecting. |
37582.0 | 2020-03-30 00:00:00 UTC | Weekly Cannabis Stock News: Coronavirus Recovery? | ACB | https://www.nasdaq.com/articles/weekly-cannabis-stock-news%3A-coronavirus-recovery-2020-03-30 | nan | nan | Marijuana stocks rose at the end of last week, beating most top-share market indexes, quite dramatically in certain cases. Why the sudden and sharp rise? It seems to be down to two major factors.
First, investors might consider the steep price declines in the sector to be a bottom-feeding opportunity. Second, it's likely that more states will legalize marijuana. That's because public budgets are going to be strained after the SARS-CoV-2 coronavirus outbreak (hopefully) abates, and will require the extra dosh from taxes on legal weed.
So considering the circumstances, it was a relatively good week for pot stocks. Here are two more positive developments:
Image source: Getty Images.
The Canada stimulus bill
Unlike more traditional sectors of the economy, marijuana was excluded from the U.S. coronavirus stimulus bill passed into law last week. But cannabis companies might still benefit from North American government largesse.
The Canadian government is preparing its own stimulus bill, and it could really be a shot in the arm for companies it assists -- even though it's modest compared with the American version (roughly $144 billion, versus $2 trillion for the U.S. aid package). BNN Bloomberg reported that a clutch of executives from the country's marijuana companies collectively requested inclusion with a formal letter sent to the government.
This feels like the first step of a lobbying effort, and if so I think it has a reasonable shot at success. Canada is a global leader in marijuana legalization, being the inaugural Western country to fully sanction the drug. As such, it has something of an obligation to put cannabis on the same level with more traditional industries; if they're getting recovery funds from the public, marijuana should too.
Also, for all its mistakes and the many roadblocks still in its path, marijuana had been making a rapidly growing contribution to the domestic economy. This should only intensify in the future, not least because they're sure to be players in foreign markets as more U.S. states and foreign countries legalize marijuana.
We don't yet have a list of the companies whose representatives signed the letter; BNN Bloomberg said the lineup included Aurora Cannabis, Tilray, and the smaller, less-known operator Fire & Flower Holdings. If the government grants their request, we can imagine that these companies will benefit accordingly. So cannabis stock investors should keep a sharp eye on how the situation develops.
A tale of two Q4s: Curaleaf and Green Thumb Industries
Within our borders, two U.S.-based marijuana companies published their respective Q4 of fiscal 2019 results -- Curaleaf Holdings (OTC: CURLF) and Green Thumb Industries (OTC: GTBIF).
Let's take Curaleaf first. The Massachusetts-headquartered operator posted revenue that was slightly under $75.5 million, a 22% improvement over the Q3 figure and almost 140% better on a year-over-year basis. Going the opposite direction was the company's net loss, which at nearly $26.6 million was worse than both the Q3 figure (again a loss, at $6.8 million) and the Q4 2018 deficit of $11.2 million.
As for Green Thumb, its top line was quite similar -- it came in at $75.8 million. This represented sequential growth of nearly 12% and a very robust 265% year-over-year increase. Net loss was $13 million, narrower than Q3's $17.1 million but deeper than the year-ago shortfall of $3.1 million.
Analysts tracking the stocks were expecting lighter net losses for both companies, although the disparity between forecast and actual performance wasn't great in either case.
There is one solid reason for investors to be optimistic about the prospects for both companies (assuming they make it through the coronavirus situation more or less intact) -- geography.
Green Thumb is very well positioned in Illinois, which at the beginning of the year flipped the switch on recreational marijuana legalization. The company already operates a set of dispensaries in the state, and more are coming soon. The state has been a hot market for recreational weed, and once it gets past the coronavirus era, it should heat up again.
Massachusetts also recently gave the green light to recreational pot. Its population is significantly smaller, plus Curaleaf has a limited footprint there (five dispensaries, with three licensed to sell recreational product and the remainder medical marijuana only). Even so, like Illinois, it's a young market that still has room to grow. Like Green Thumb, Curaleaf is in the right place at the right time for this.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Eric Volkman has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Green Thumb Industries. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The Canadian government is preparing its own stimulus bill, and it could really be a shot in the arm for companies it assists -- even though it's modest compared with the American version (roughly $144 billion, versus $2 trillion for the U.S. aid package). We don't yet have a list of the companies whose representatives signed the letter; BNN Bloomberg said the lineup included Aurora Cannabis, Tilray, and the smaller, less-known operator Fire & Flower Holdings. Analysts tracking the stocks were expecting lighter net losses for both companies, although the disparity between forecast and actual performance wasn't great in either case. | The Canada stimulus bill Unlike more traditional sectors of the economy, marijuana was excluded from the U.S. coronavirus stimulus bill passed into law last week. This should only intensify in the future, not least because they're sure to be players in foreign markets as more U.S. states and foreign countries legalize marijuana. A tale of two Q4s: Curaleaf and Green Thumb Industries Within our borders, two U.S.-based marijuana companies published their respective Q4 of fiscal 2019 results -- Curaleaf Holdings (OTC: CURLF) and Green Thumb Industries (OTC: GTBIF). | A tale of two Q4s: Curaleaf and Green Thumb Industries Within our borders, two U.S.-based marijuana companies published their respective Q4 of fiscal 2019 results -- Curaleaf Holdings (OTC: CURLF) and Green Thumb Industries (OTC: GTBIF). Here's The Marijuana Stock You've Been Waiting For A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom. Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018. | So cannabis stock investors should keep a sharp eye on how the situation develops. Green Thumb is very well positioned in Illinois, which at the beginning of the year flipped the switch on recreational marijuana legalization. The company already operates a set of dispensaries in the state, and more are coming soon. |
37583.0 | 2020-03-28 00:00:00 UTC | Insurance Reimbursements for Medical Pot in Germany Rise 67% in 2019 | ACB | https://www.nasdaq.com/articles/insurance-reimbursements-for-medical-pot-in-germany-rise-67-in-2019-2020-03-28 | nan | nan | Medical marijuana in Germany, one of the world's top markets for that form of the drug, experienced a boom in 2019. Quoting statistics from the country's National Association of Statutory Health Insurance Funds, Marijuana Business Daily said that insurance companies reimbursed German patients 123 million euros ($136 million) that year for cannabis as medicine. That was 67% higher than the 2018 figure.
Much of this was due to a leap in the number of prescriptions for the drug. These rose by 44% year over year to reach over 267,000 in total. The disparity between the gains in the sales figure and the number of prescriptions suggests that patients were being prescribed larger amounts.
Image source: Getty Images.
This is despite the fact that major foreign supplier Aurora Cannabis (NYSE: ACB) was not active on the market. In November, Germany suspended Aurora's sales activity, apparently due to issues with its licensing. Those issues have since been rectified, and the marijuana company is again selling product.
Germany is a fairly new arrival on the global medical marijuana scene. The country's parliament legalized it in 2017, and it came into force in March of that year. Even now, however, Germany is one of the few European countries that has legalized any form of cannabis, although several have decriminalized recreational use and sale.
On Friday, Aurora shares rose nearly 14% while the broader stock market indexes sank by single-digit percentages. Most likely, this is not due to the news out of Germany; instead, investors are optimistic that state governments desperate for cash after the coronavirus outbreak subsides will legalize at least some form of marijuana (that is, if they haven't done so already).
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | This is despite the fact that major foreign supplier Aurora Cannabis (NYSE: ACB) was not active on the market. The disparity between the gains in the sales figure and the number of prescriptions suggests that patients were being prescribed larger amounts. Most likely, this is not due to the news out of Germany; instead, investors are optimistic that state governments desperate for cash after the coronavirus outbreak subsides will legalize at least some form of marijuana (that is, if they haven't done so already). | This is despite the fact that major foreign supplier Aurora Cannabis (NYSE: ACB) was not active on the market. Quoting statistics from the country's National Association of Statutory Health Insurance Funds, Marijuana Business Daily said that insurance companies reimbursed German patients 123 million euros ($136 million) that year for cannabis as medicine. In November, Germany suspended Aurora's sales activity, apparently due to issues with its licensing. | This is despite the fact that major foreign supplier Aurora Cannabis (NYSE: ACB) was not active on the market. Quoting statistics from the country's National Association of Statutory Health Insurance Funds, Marijuana Business Daily said that insurance companies reimbursed German patients 123 million euros ($136 million) that year for cannabis as medicine. Here's The Marijuana Stock You've Been Waiting For A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom. | This is despite the fact that major foreign supplier Aurora Cannabis (NYSE: ACB) was not active on the market. Medical marijuana in Germany, one of the world's top markets for that form of the drug, experienced a boom in 2019. Here's The Marijuana Stock You've Been Waiting For A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom. |
37584.0 | 2020-03-27 00:00:00 UTC | Report: Canadian Government Formally Solicits Pot Industry's Help With Coronavirus Testing | ACB | https://www.nasdaq.com/articles/report%3A-canadian-government-formally-solicits-pot-industrys-help-with-coronavirus-testing | nan | nan | Marijuana companies in Canada have donated equipment such as surgical masks to healthcare professionals fighting the SARS-CoV-2 coronavirus and the COVID-19 disease associated with it. Now their government is asking them for more help.
According to an article in BNN Bloomberg citing an email it obtained from the country's health authority Health Canada, which was subsequently confirmed by the organization, executives of licensed cannabis companies were asked if they had spare laboratory capacity. Health Canada aims to utilize this to test for COVID-19.
Image source: Getty Images.
In the email sent to numerous recipients, Health Canada acting director general Joanne Garrah wrote that her organization is "currently working to understand the specific needs and related questions, and we will be it touch in the coming days to request more information. If you have lab capacity within your facility and are interested in assisting, please notify us by email."
A Health Canada spokesperson did not disclose whether any of the recipients agreed to the solicitation.
One that says it's considering it seriously is Aurora Cannabis (NYSE: ACB). BNN Bloomberg quoted an Aurora spokesperson as saying that the company thinks the request is "an exciting opportunity and [is] quickly looking at whether our various lab spaces could meet needs."
She added that, "We just have to do due diligence in terms of seeing if our resources will meaningfully help fill gaps [Health Canada] is identifying, which is our hope."
According to the organization's latest statistics, as of Friday morning, there were 4,018 cases of COVID-19 in Canada, with 39 fatalities.
The performance of Aurora's shares was in sharp contrast to that of the broader market. The marijuana stock closed nearly 14% higher on the day.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | One that says it's considering it seriously is Aurora Cannabis (NYSE: ACB). In the email sent to numerous recipients, Health Canada acting director general Joanne Garrah wrote that her organization is "currently working to understand the specific needs and related questions, and we will be it touch in the coming days to request more information. BNN Bloomberg quoted an Aurora spokesperson as saying that the company thinks the request is "an exciting opportunity and [is] quickly looking at whether our various lab spaces could meet needs." | One that says it's considering it seriously is Aurora Cannabis (NYSE: ACB). According to an article in BNN Bloomberg citing an email it obtained from the country's health authority Health Canada, which was subsequently confirmed by the organization, executives of licensed cannabis companies were asked if they had spare laboratory capacity. A Health Canada spokesperson did not disclose whether any of the recipients agreed to the solicitation. | One that says it's considering it seriously is Aurora Cannabis (NYSE: ACB). According to an article in BNN Bloomberg citing an email it obtained from the country's health authority Health Canada, which was subsequently confirmed by the organization, executives of licensed cannabis companies were asked if they had spare laboratory capacity. In the email sent to numerous recipients, Health Canada acting director general Joanne Garrah wrote that her organization is "currently working to understand the specific needs and related questions, and we will be it touch in the coming days to request more information. | One that says it's considering it seriously is Aurora Cannabis (NYSE: ACB). According to an article in BNN Bloomberg citing an email it obtained from the country's health authority Health Canada, which was subsequently confirmed by the organization, executives of licensed cannabis companies were asked if they had spare laboratory capacity. Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks. |
37585.0 | 2020-03-27 00:00:00 UTC | Aurora Cannabis (ACB) Stock Gets a Recession Boost; What’s Next? | ACB | https://www.nasdaq.com/articles/aurora-cannabis-acb-stock-gets-a-recession-boost-whats-next-2020-03-27 | nan | nan | The global economic shutdown due to the coronavirus was a potential nightmare for Aurora Cannabis (ACB). The Canadian cannabis company is in the middle of cutting capacity and costs for the new reality in the market while trying to avoid running out of cash. A complete shutdown of cannabis stores would’ve crushed any remaining hope in financial improvements at the business, but the market has seen the opposite effect of the shutdown actually lead to a boost to cannabis sales as consumers stay at home.
Booming Sales
On March 17, Canopy Growth (CGC) announced the closure of all 23 of their retail stores in Canada due to the Covid-19 outbreak. Since this point, sales have soared in Canada as consumers have rushed to purchase weed.
Several provinces including Ontario and Quebec have deemed cannabis stores as essential while the Ontario Cannabis Store’s website had the director of communications confirm sales over the weekend doubled the sales from only two weeks ago. Likewise, Nova Scotia reported cannabis sales spiked 76% last week.
Whether due to fears of store closures or adult users staying at home with no work, people have flocked to cannabis stores to ensure supplies to wait out the virus from home. In addition, a supplier like Aurora Cannabis gets the extra benefit of not having Canopy Growth stores open.
The one major caveat is that Canadian cannabis sales could yet be impacted as the virus outbreak rolls throughout the country and any lingering impact is unknown.
Rescue
The sales boost couldn’t have come at a better time. The Canadian sector was flooded with cannabis supply and companies were struggling to generate profitable revenue growth. Aurora Cannabis alone had C$216 million in inventory on their books suggesting enough supply for the next year.
The company couldn’t afford another quarter of weak sales. Based on the initial sales indications from March, Aurora Cannabis should top analyst estimates for a revenue rebound to C$65 million in the current quarter. The company had net revenues of C$63 million in the December quarter.
The company has initiated a cost reduction program to get quarterly operating expenses below C$45 million. A key aspect of any turnaround is for Aurora Cannabis and the sector to actually generate revenue growth in 2020 with new retail stores opening and Cannabis 2.0 products launching. The combination will help cut the EBITDA losses.
Ontario was set to start allowing 20 new stores to open per month and the Covid-19 outbreak might provide some regulatory and construction delays, but the market should start seeing consistent growth in the key province. Aurora Cannabis has survived the bottom and can now continue with at-the-market equity sales to raise funds for operations and the last remaining capex spending.
Takeaway
The key investor takeaway is that Aurora Cannabis got the sales boost the company needed to get over the hump. The former CEO selling 12.16 million shares into the open market on March 16 was the headline that likely created a bottom in the stock below $0.70.
Aurora Cannabis should see the diluted share count balloon to 1.3 to 1.4 billion shares outstanding. As the company approaches an EBITDA breakeven level later in the year with the streamlined operations, the stock will finally get a footing back above $1.
According to TipRanks, the consensus on Wall Street is that Aurora stock is a “hold” for investors. But TipRanks might as well have said “buy” — because analysts, on average, think the stock, currently at $0.99, could zoom ahead to $1.71 within a year, delivering 71% profits to new investors. (See Aurora stock analysis on TipRanks)
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The global economic shutdown due to the coronavirus was a potential nightmare for Aurora Cannabis (ACB). Booming Sales On March 17, Canopy Growth (CGC) announced the closure of all 23 of their retail stores in Canada due to the Covid-19 outbreak. Based on the initial sales indications from March, Aurora Cannabis should top analyst estimates for a revenue rebound to C$65 million in the current quarter. | The global economic shutdown due to the coronavirus was a potential nightmare for Aurora Cannabis (ACB). The Canadian sector was flooded with cannabis supply and companies were struggling to generate profitable revenue growth. A key aspect of any turnaround is for Aurora Cannabis and the sector to actually generate revenue growth in 2020 with new retail stores opening and Cannabis 2.0 products launching. | The global economic shutdown due to the coronavirus was a potential nightmare for Aurora Cannabis (ACB). A complete shutdown of cannabis stores would’ve crushed any remaining hope in financial improvements at the business, but the market has seen the opposite effect of the shutdown actually lead to a boost to cannabis sales as consumers stay at home. Several provinces including Ontario and Quebec have deemed cannabis stores as essential while the Ontario Cannabis Store’s website had the director of communications confirm sales over the weekend doubled the sales from only two weeks ago. | The global economic shutdown due to the coronavirus was a potential nightmare for Aurora Cannabis (ACB). Booming Sales On March 17, Canopy Growth (CGC) announced the closure of all 23 of their retail stores in Canada due to the Covid-19 outbreak. The Canadian sector was flooded with cannabis supply and companies were struggling to generate profitable revenue growth. |
37586.0 | 2020-03-26 00:00:00 UTC | Stock Market Wrap-Up: Why Marijuana Stocks Soared but Beyond Meat Fell | ACB | https://www.nasdaq.com/articles/stock-market-wrap-up%3A-why-marijuana-stocks-soared-but-beyond-meat-fell-2020-03-26 | nan | nan | The stock market kept up its winning streak on Thursday, with the Dow Jones Industrial Average (DJINDICES: ^DJI) and the S&P 500 (SNPINDEX: ^GSPC) extending their winning streaks to three straight days. Investors were pleased with the Senate passage of the coronavirus stimulus bill, seeing it as a potential solution to the financial problems that the pandemic has caused. The Nasdaq Composite (NASDAQINDEX: ^IXIC) also rose on the day, with all three indexes seeing gains of around 5% to 6%.
Today's stock market
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Nasdaq Composite | The stock market kept up its winning streak on Thursday, with the Dow Jones Industrial Average (DJINDICES: ^DJI) and the S&P 500 (SNPINDEX: ^GSPC) extending their winning streaks to three straight days. Investors were pleased with the Senate passage of the coronavirus stimulus bill, seeing it as a potential solution to the financial problems that the pandemic has caused. The Nasdaq Composite (NASDAQINDEX: ^IXIC) also rose on the day, with all three indexes seeing gains of around 5% to 6%. | The stock market kept up its winning streak on Thursday, with the Dow Jones Industrial Average (DJINDICES: ^DJI) and the S&P 500 (SNPINDEX: ^GSPC) extending their winning streaks to three straight days. The Nasdaq Composite (NASDAQINDEX: ^IXIC) also rose on the day, with all three indexes seeing gains of around 5% to 6%. Today's stock market | The stock market kept up its winning streak on Thursday, with the Dow Jones Industrial Average (DJINDICES: ^DJI) and the S&P 500 (SNPINDEX: ^GSPC) extending their winning streaks to three straight days. Investors were pleased with the Senate passage of the coronavirus stimulus bill, seeing it as a potential solution to the financial problems that the pandemic has caused. The Nasdaq Composite (NASDAQINDEX: ^IXIC) also rose on the day, with all three indexes seeing gains of around 5% to 6%. | The stock market kept up its winning streak on Thursday, with the Dow Jones Industrial Average (DJINDICES: ^DJI) and the S&P 500 (SNPINDEX: ^GSPC) extending their winning streaks to three straight days. Investors were pleased with the Senate passage of the coronavirus stimulus bill, seeing it as a potential solution to the financial problems that the pandemic has caused. The Nasdaq Composite (NASDAQINDEX: ^IXIC) also rose on the day, with all three indexes seeing gains of around 5% to 6%. |
37587.0 | 2020-03-25 00:00:00 UTC | Have Marijuana Investors Just Given Up? | ACB | https://www.nasdaq.com/articles/have-marijuana-investors-just-given-up-2020-03-25 | nan | nan | The cannabis industry has gone through a rough period lately. After building extremely high expectations in 2018 with the legalization of recreational marijuana in Canada, marijuana stocks suffered significant losses in 2019. Just when it looked as though 2020 might be a better year for the cannabis industry, disruptions related to the coronavirus outbreak added new challenges.
In light of the broader stock market's declines, it's easy to see the poor performance of cannabis stocks so far this year as simply reflecting the poor overall environment. There's something, though, that throws cold water on that theory. Many of the year's worst performers turned things around to produce the best gains in Tuesday's massive market bounce, but many of the biggest cannabis cultivators in the industry failed even to keep up with broader stock indexes, let alone lead the entire market higher. That's the latest sign that marijuana investors just seem to be giving up on the industry as a place to make money.
Image source: Getty Images.
What goes down should go up
When you look at Tuesday's market action, you'll notice a lot of the industries that got hit the hardest in the coronavirus market crash were among the big leaders. Airlines, for instance, saw double-digit percentage gains, with the weaker players in the industry generally showing some of the biggest advances. Similarly, cruise ship operators, homebuilders, and related industries like aircraft parts and components suppliers all saw extremely encouraging bounces from their recent lows.
Cannabis stocks didn't show that kind of reaction at all. Tilray (NASDAQ: TLRY), which has lost more than three-quarters of its value so far this year, only managed a 4% advance. Cronos Group (NASDAQ: CRON) did slightly better, rising 7%, but it's still down almost 30% on the year. Gains of 5% for Aurora Cannabis (NYSE: ACB) still left its stock well below the $1 per share level on the New York Stock Exchange and off by two-third year to date. Even Canopy Growth (NYSE: CGC), which is down almost 40% so far in 2020, only managed to claw back about 4% today.
Should investors be more bullish?
Many of the same arguments favoring cannabis companies still exist despite the big drops in their share prices over the past year. The Canadian market remains full of promise, as cultivators haven't been able to increase their distribution as much as originally hoped because of a lack of retail locations in key parts of the country, especially Ontario. Moreover, Canada is moving forward with newer, value-added cannabis products that go well beyond simple marijuana flower and can fetch premium prices. Similarly, the opening of legal hemp in the U.S. market has provided opportunities for Canadian cannabis companies to move south -- and that could prepare them for a broader legalization if it comes in the future.
Also, the drop in cannabis stock prices has made them more affordable and attractive. Even though profitability has still eluded many marijuana companies, revenue levels have risen enough to justify current valuations in some investors' eyes.
Losing interest
Yet even with those favorable attributes, marijuana stocks just aren't getting any love. Even interest in the largest marijuana ETF, ETFMG Alternative Harvest (NYSEMKT: MJ), has been lackluster. Net assets now amount to just over $600 million, down from over $1 billion at its peak. Volume for the ETF was more than 20% below its average -- on a day when investors were eager to grab up shares of companies in other hard-hit industries.
Dismissing cannabis stocks entirely at this point would be a mistake for investors, given that the budding marijuana market is still growing and has good long-term prospects. However, those looking to buy should be picky in selecting the companies they think have the best chance to emerge on top in the long run.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Dan Caplinger has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Gains of 5% for Aurora Cannabis (NYSE: ACB) still left its stock well below the $1 per share level on the New York Stock Exchange and off by two-third year to date. Similarly, cruise ship operators, homebuilders, and related industries like aircraft parts and components suppliers all saw extremely encouraging bounces from their recent lows. The Canadian market remains full of promise, as cultivators haven't been able to increase their distribution as much as originally hoped because of a lack of retail locations in key parts of the country, especially Ontario. | Gains of 5% for Aurora Cannabis (NYSE: ACB) still left its stock well below the $1 per share level on the New York Stock Exchange and off by two-third year to date. After building extremely high expectations in 2018 with the legalization of recreational marijuana in Canada, marijuana stocks suffered significant losses in 2019. In light of the broader stock market's declines, it's easy to see the poor performance of cannabis stocks so far this year as simply reflecting the poor overall environment. | Gains of 5% for Aurora Cannabis (NYSE: ACB) still left its stock well below the $1 per share level on the New York Stock Exchange and off by two-third year to date. In light of the broader stock market's declines, it's easy to see the poor performance of cannabis stocks so far this year as simply reflecting the poor overall environment. Many of the year's worst performers turned things around to produce the best gains in Tuesday's massive market bounce, but many of the biggest cannabis cultivators in the industry failed even to keep up with broader stock indexes, let alone lead the entire market higher. | Gains of 5% for Aurora Cannabis (NYSE: ACB) still left its stock well below the $1 per share level on the New York Stock Exchange and off by two-third year to date. Should investors be more bullish? Many of the same arguments favoring cannabis companies still exist despite the big drops in their share prices over the past year. |
37588.0 | 2020-03-24 00:00:00 UTC | Canadian Cannabis Companies Ask to Be Included in Ottawa's Coronavirus Aid Package | ACB | https://www.nasdaq.com/articles/canadian-cannabis-companies-ask-to-be-included-in-ottawas-coronavirus-aid-package-2020-03 | nan | nan | A large group of Canadian marijuana companies are banding together to lobby for financial aid from their government, according to numerous reports in the media. They hope to be included in a planned 82 billion Canadian dollar ($57 billion) rescue package aimed at mitigating the economic damage caused by the SARS-CoV-2 coronavirus outbreak.
According to an article from news agency The Canadian Press, representatives of more than 70 companies and other parties involved in the marijuana business have signed the letter requesting support. It was addressed to Finance Minister Bill Morneau and Industry Minister Navdeep Bains.
Additionally, the petitioners have requested the right to borrow money from a pair of government agencies, Export Development Canada and the Business Development Bank of Canada.
Image source: Getty Images
BNN Bloomberg obtained a copy of the letter, which it quoted as saying: "Canada's cannabis industry has weathered several shocks in the past six months, including the loss of over 2,000 well-paying jobs in the sector. Our access to capital, including credit, is challenging."
BNN Bloomberg wrote that among the signatories are Adine Carter, chief marketing officer at Tilray (NASDAQ: TLRY) and Rick Savone, senior vice president of Aurora Cannabis (NYSE: ACB).
Last week, Prime Minister Justin Trudeau unveiled the plan, which will take the form of CA$27 billion ($19 billion) in direct assistance to individuals and enterprises, accompanied by CA$55 billion ($38 billion) worth of tax deferrals.
No arm of the government has yet officially commented on the request, nor have Aurora Cannabis or Tilray.
The fortunes of the two marijuana companies' stocks diverged on Monday. Aurora Cannabis fell 6.5%, which was a sharper decline than the broader market, while Tilray rose by 5.5%.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | BNN Bloomberg wrote that among the signatories are Adine Carter, chief marketing officer at Tilray (NASDAQ: TLRY) and Rick Savone, senior vice president of Aurora Cannabis (NYSE: ACB). A large group of Canadian marijuana companies are banding together to lobby for financial aid from their government, according to numerous reports in the media. According to an article from news agency The Canadian Press, representatives of more than 70 companies and other parties involved in the marijuana business have signed the letter requesting support. | BNN Bloomberg wrote that among the signatories are Adine Carter, chief marketing officer at Tilray (NASDAQ: TLRY) and Rick Savone, senior vice president of Aurora Cannabis (NYSE: ACB). A large group of Canadian marijuana companies are banding together to lobby for financial aid from their government, according to numerous reports in the media. They hope to be included in a planned 82 billion Canadian dollar ($57 billion) rescue package aimed at mitigating the economic damage caused by the SARS-CoV-2 coronavirus outbreak. | BNN Bloomberg wrote that among the signatories are Adine Carter, chief marketing officer at Tilray (NASDAQ: TLRY) and Rick Savone, senior vice president of Aurora Cannabis (NYSE: ACB). Last week, Prime Minister Justin Trudeau unveiled the plan, which will take the form of CA$27 billion ($19 billion) in direct assistance to individuals and enterprises, accompanied by CA$55 billion ($38 billion) worth of tax deferrals. Here's The Marijuana Stock You've Been Waiting For A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom. | BNN Bloomberg wrote that among the signatories are Adine Carter, chief marketing officer at Tilray (NASDAQ: TLRY) and Rick Savone, senior vice president of Aurora Cannabis (NYSE: ACB). Here's The Marijuana Stock You've Been Waiting For A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom. And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution. |
37589.0 | 2020-03-24 00:00:00 UTC | 3 Reasons Cannabis Stocks Are a Buy Right Now | ACB | https://www.nasdaq.com/articles/3-reasons-cannabis-stocks-are-a-buy-right-now-2020-03-24 | nan | nan | As bleak as things look in the stock market right now, the coronavirus-fueled stock market crash is presenting one of the best opportunities to buy stocks that you'll probably ever see. Some kinds of stocks are better options than others are, though.
You might think that cannabis stocks would be really low on the list to snatch up right now. After all, there was already a lot of speculation involved with investing in these stocks even before the coronavirus pandemic. But there are three solid reasons cannabis stocks are a buy right now.
Image source: Getty Images.
1. Demand remains strong
One important thing to keep in mind when checking out any stock to buy in these tumultuous times is the level of demand their products and services will have in the near term. The good news for many cannabis stocks is that demand appears to be resilient.
To be sure, social distancing, lockdowns, and quarantines are negatively impacting the retail market, in general, and that's spilling over to the cannabis industry. Canadian cannabis producers like Aurora Cannabis (NYSE: ACB) and Canopy Growth (NYSE: CGC) were already battling headwinds from the lack of enough retail cannabis stores in Ontario, Canada's most heavily populated province. The coronavirus pandemic is no doubt making these companies' retail problems even more pronounced.
However, throughout Canada and the U.S., reports are coming in indicating a surge in recreational marijuana sales. A lot of this buying likely stems from anxious consumers stocking up on pot in case they're unable to leave their homes in the near future.
The good news for medical cannabis businesses is that many key states are classifying them as "essential" and entitled to remain open during a lockdown. Several states have also enacted measures to encourage home delivery of medical cannabis products.
2. Valuations are dirt cheap
You'll run out fingers and toes counting the number of cannabis stocks that have plunged by 50% or more off their highs this year. Valuations of cannabis stocks are dirt cheap as a result of the coronavirus stock market crash.
Former high-flying Canadian marijuana stocks now boast reasonable price-to-sales multiples. That includes companies that have been managed quite well. Shares of Organigram (NASDAQ: OGI), for example, currently trade at close to 3.7 times trailing-12-month sales.
Profitable cannabis-related businesses have also seen their valuations plummet. Innovative Industrial Properties' (NYSE: IIPR) market cap has been nearly halved from its February high mark. Its shares now trade at a little over 15 times expected earnings, much lower than in the past.
3. The long-term opportunity is still huge
I've saved the most important reason to buy cannabis stocks right now for last. Despite the current uncertainty, the long-term opportunity for the global cannabis industry is still huge.
In Canada, the Cannabis 2.0 market will create tremendous opportunities for cannabis derivatives products -- even if those opportunities take longer to fully blossom due to the COVID-19 outbreak. In the U.S., legal cannabis markets in states will continue to mature and expand. And more states will likely legalize medical cannabis and recreational marijuana.
It's hard to focus on the future when the present is very troubling. But that's exactly what successful investors should do. The crisis resulting from the coronavirus pandemic will only be temporary. Nothing about the health scare diminishes the prospects for the cannabis industry. The myopic perspective that many investors have presents a great opportunity for other investors with long-term perspectives.
A critical criterion
Cannabis stocks are a buy right now -- but not all of them. There's one critical criterion that should be considered in choosing which individual stocks to invest in. That criterion is financial strength.
Companies that aren't profitable and don't have an ample cash stockpile could have to raise cash in the coming months. There's no guarantee that stocks will recover that quickly. As a result, some cannabis companies could have to issue new shares at a horrible time when stock prices remain very low. Aurora Cannabis could be the poster child for this scenario.
The ideal cannabis stocks to buy will be both profitable and have plenty of cash. Innovative Industrial Properties is a top pick, in my view. It's consistently profitable. It has a reliable revenue stream from the properties it's leased to medical cannabis operators. And IIP had nearly $237 million in cash, cash equivalents, restricted cash, and investments at the end of 2019. Investing in only cannabis stocks that are financially strong like IIP should increase your chances of generating great long-term returns.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Keith Speights has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Innovative Industrial Properties and OrganiGram Holdings. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Canadian cannabis producers like Aurora Cannabis (NYSE: ACB) and Canopy Growth (NYSE: CGC) were already battling headwinds from the lack of enough retail cannabis stores in Ontario, Canada's most heavily populated province. The good news for medical cannabis businesses is that many key states are classifying them as "essential" and entitled to remain open during a lockdown. Valuations are dirt cheap You'll run out fingers and toes counting the number of cannabis stocks that have plunged by 50% or more off their highs this year. | Canadian cannabis producers like Aurora Cannabis (NYSE: ACB) and Canopy Growth (NYSE: CGC) were already battling headwinds from the lack of enough retail cannabis stores in Ontario, Canada's most heavily populated province. The good news for medical cannabis businesses is that many key states are classifying them as "essential" and entitled to remain open during a lockdown. Valuations of cannabis stocks are dirt cheap as a result of the coronavirus stock market crash. | Canadian cannabis producers like Aurora Cannabis (NYSE: ACB) and Canopy Growth (NYSE: CGC) were already battling headwinds from the lack of enough retail cannabis stores in Ontario, Canada's most heavily populated province. As bleak as things look in the stock market right now, the coronavirus-fueled stock market crash is presenting one of the best opportunities to buy stocks that you'll probably ever see. Valuations of cannabis stocks are dirt cheap as a result of the coronavirus stock market crash. | Canadian cannabis producers like Aurora Cannabis (NYSE: ACB) and Canopy Growth (NYSE: CGC) were already battling headwinds from the lack of enough retail cannabis stores in Ontario, Canada's most heavily populated province. As bleak as things look in the stock market right now, the coronavirus-fueled stock market crash is presenting one of the best opportunities to buy stocks that you'll probably ever see. The long-term opportunity is still huge I've saved the most important reason to buy cannabis stocks right now for last. |
37590.0 | 2020-03-23 00:00:00 UTC | Ghana Legalizes Cannabis -- but Only the Hemp Variety | ACB | https://www.nasdaq.com/articles/ghana-legalizes-cannabis-but-only-the-hemp-variety-2020-03-23 | nan | nan | On Friday, Ghana's parliament passed the Narcotics Control Commission Bill, which will allow the use and cultivation of cannabis for medical and industrial uses -- but only the variety that is better known as hemp.
The new law limits the allowable concentration of tetrahydrocannabinol (THC) in the plants -- the substance that gets people high -- to less than 0.3%. That's the same level that was made legal for cultivation in the U.S. by the 2018 Farm Bill. However, cannabidiol (CBD), which is believed to provide health benefits, can be extracted from hemp. Recreational cannabis use remains illegal in Ghana.
Nana Kwaku Agyemang, president of the Hemp Association of Ghana, says legalizing hemp isn't about getting people high: "We are not promoting smoking, we are promoting the industry, we are promoting cleaning up the environment, we are promoting creating a new revenue stream for government in terms of taxing from cultivation and export and we are talking about promoting medicines that are far better than opioids, medicines that cannot kill you because no one has died from taking cannabis."
Ghana is just the latest African country to loosen laws surrounding cannabis. Earlier this month, Malawi also legalized marijuana for medical use. Other countries that have made similar moves include Zimbabwe, Zambia, South Africa, and Lesotho.
Image source: Getty Images.
Going global a key part of the strategy for North American producers
Aurora Cannabis (NYSE: ACB) has one of the largest global reaches of any cannabis company, with a presence in more than two dozen countries, including some in Africa. Its CanniMed subsidiary has an agreement with South African company Akula Trading to supply South Africa with cannabis. Cannabis companies have been looking beyond North America not only to reach a larger market of potential customers, but also to find sites for lower-cost cannabis production.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
David Jagielski has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Going global a key part of the strategy for North American producers Aurora Cannabis (NYSE: ACB) has one of the largest global reaches of any cannabis company, with a presence in more than two dozen countries, including some in Africa. On Friday, Ghana's parliament passed the Narcotics Control Commission Bill, which will allow the use and cultivation of cannabis for medical and industrial uses -- but only the variety that is better known as hemp. The new law limits the allowable concentration of tetrahydrocannabinol (THC) in the plants -- the substance that gets people high -- to less than 0.3%. | Going global a key part of the strategy for North American producers Aurora Cannabis (NYSE: ACB) has one of the largest global reaches of any cannabis company, with a presence in more than two dozen countries, including some in Africa. Its CanniMed subsidiary has an agreement with South African company Akula Trading to supply South Africa with cannabis. Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018. | Going global a key part of the strategy for North American producers Aurora Cannabis (NYSE: ACB) has one of the largest global reaches of any cannabis company, with a presence in more than two dozen countries, including some in Africa. Nana Kwaku Agyemang, president of the Hemp Association of Ghana, says legalizing hemp isn't about getting people high: "We are not promoting smoking, we are promoting the industry, we are promoting cleaning up the environment, we are promoting creating a new revenue stream for government in terms of taxing from cultivation and export and we are talking about promoting medicines that are far better than opioids, medicines that cannot kill you because no one has died from taking cannabis." Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018. | Going global a key part of the strategy for North American producers Aurora Cannabis (NYSE: ACB) has one of the largest global reaches of any cannabis company, with a presence in more than two dozen countries, including some in Africa. On Friday, Ghana's parliament passed the Narcotics Control Commission Bill, which will allow the use and cultivation of cannabis for medical and industrial uses -- but only the variety that is better known as hemp. Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018. |
37591.0 | 2020-03-23 00:00:00 UTC | Will the Coronavirus Crush These 2 Pot Stocks? | ACB | https://www.nasdaq.com/articles/will-the-coronavirus-crush-these-2-pot-stocks-2020-03-23 | nan | nan | It's a sensitive time on the stock market these days with the coronavirus sending investors into a panic. That's bad news, especially for the cannabis industry where stocks are cratering to all-time lows. Many investments are down 60% or more. Exchange-traded funds (ETFs) are normally safer investments since they hold a variety of different stocks, and yet the Horizons Marijuana Life Sciences ETF is down 80% in just one year.
Things could get even worse, and the two stocks listed below could be in a world of trouble.
1. Aurora Cannabis
Aurora Cannabis (NYSE: ACB) is one of the worst-performing pot stocks over the past year, as it's fallen around 93% in just 12 months. From trading close to $10 per share a year ago, the stock now finds itself well below the $1 mark. A big problem for Aurora is that the company's fallen short of not just analyst expectations, but even its own projections.
When the company reported its fourth-quarter results on Sept. 11, its sales didn't meet the guidance Aurora issued earlier. It wasn't startling that Aurora missed -- it was that it had issued an update just a month earlier saying net revenue would fall between 100 million Canadian dollars and CA$107 million. But when Aurora reported earnings on Sept. 11, the actual number came in at CA$98.9 million. The company also expected its earnings before interest, taxes, depreciation, and amortization (EBITDA) would be positive by that quarter. Instead, the company reported an adjusted EBITDA loss of CA$11.7 million.
Image source: Getty Images.
It wasn't just Q4 when Aurora disappointed investors. In the following two quarters, its sales fell to CA$75.2 million and then again to CA$56 million. Sales growth is a key reason investors have been willing to pay a premium for pot stocks in the past. And with the company now projecting "modest to no growth" in the upcoming quarter, the company isn't expecting a miraculous turnaround anytime soon. What makes the situation all the more challenging is the pot producer's lack of cash.
In the second quarter, Aurora reported having cash and cash equivalents totaling CA$156.3 million as of Dec. 31. And it could go through that in short order, given that over the past six months it burned through CA$229.6 million from its day-to-day operating activities. Investment bank Ello Capital projected last month that Aurora Cannabis may only have a couple of months of liquidity left and that its cash situation is among the worst in the industry.
As the coronavirus threatens to keep people home as the pandemic continues to spread, Aurora may generate even less revenue to cover its expenses. And while cannabis delivery is one option for consumers, Canada Post may not be of much help as it will no longer deliver products that require a signature, such as cannabis, to someone's door, and the recipient will need to sign for these packages at a post office. Cannabis stores remain open in many parts of the country, but it may not remain that way if the outbreak of COVID-19 becomes even worse in Canada and government officials impose lockdowns.
There's been an uptick in traffic of consumers stocking up on cannabis, but over the longer term, it's likely that sales may come to a halt in some parts of Canada if the spread of COVID-19 gets out of control. For Aurora, it creates a very sensitive situation where it could run out of money. And as challenging as 2020 has already been for the company, it's about to get even more difficult.
2. Cresco Labs
Cresco Labs (OTC: CURLF) is in a better position than Aurora in terms of cash, but it's still facing many challenges as a result of the COVID-19 pandemic. The company released its third-quarter results on Nov. 26, which showed that as of Sept. 30, Cresco had cash and cash equivalents totaling $73.7 million. And over the past nine months, it only used $18.6 million to fund its day-to-day activities, suggesting it may be in okay shape for the foreseeable future.
But the spread of COVID-19 is much worse in the U.S. than it is in Canada, with the former now at well over 10,000 cases while the latter is still below 1,000. Those numbers may change rapidly, but California is already under a lockdown due to the severity of the coronavirus and more cities and states around the country may follow suit.
Regardless of how much money Cresco Labs has on hand or how little cash it's burned through, if sales take a hit, the losses will mount and the situation will get worse. The government may help struggling businesses, but there's no guarantee that there will be enough money to go around to help cannabis producers like Cresco to stave off dire circumstances.
The reality is that COVID-19 is such an uncertain situation that it's difficult to predict how it may affect cannabis companies. But one thing's for sure: The longer it drags out, the worse of a problem it'll be for cannabis companies. Cresco may be in a better position than Aurora for now, but that still shouldn't put investors at ease. Shares of Cresco are down 75% over the past year.
Takeaway for investors
Pot stocks like Cresco and Aurora may be down and cheaper than they've been in the past, but there's good reason for it -- there's a lot more risk in the industry as well. These companies are at serious risk today, and even if they're able to withstand and survive this adversity, their valuations may continue to take a beating in the process. And that's why, for now, investors may want to avoid investing in either of these two pot stocks today.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
David Jagielski has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Aurora Cannabis Aurora Cannabis (NYSE: ACB) is one of the worst-performing pot stocks over the past year, as it's fallen around 93% in just 12 months. There's been an uptick in traffic of consumers stocking up on cannabis, but over the longer term, it's likely that sales may come to a halt in some parts of Canada if the spread of COVID-19 gets out of control. Takeaway for investors Pot stocks like Cresco and Aurora may be down and cheaper than they've been in the past, but there's good reason for it -- there's a lot more risk in the industry as well. | Aurora Cannabis Aurora Cannabis (NYSE: ACB) is one of the worst-performing pot stocks over the past year, as it's fallen around 93% in just 12 months. In the second quarter, Aurora reported having cash and cash equivalents totaling CA$156.3 million as of Dec. 31. The company released its third-quarter results on Nov. 26, which showed that as of Sept. 30, Cresco had cash and cash equivalents totaling $73.7 million. | Aurora Cannabis Aurora Cannabis (NYSE: ACB) is one of the worst-performing pot stocks over the past year, as it's fallen around 93% in just 12 months. Investment bank Ello Capital projected last month that Aurora Cannabis may only have a couple of months of liquidity left and that its cash situation is among the worst in the industry. Takeaway for investors Pot stocks like Cresco and Aurora may be down and cheaper than they've been in the past, but there's good reason for it -- there's a lot more risk in the industry as well. | Aurora Cannabis Aurora Cannabis (NYSE: ACB) is one of the worst-performing pot stocks over the past year, as it's fallen around 93% in just 12 months. What makes the situation all the more challenging is the pot producer's lack of cash. But the spread of COVID-19 is much worse in the U.S. than it is in Canada, with the former now at well over 10,000 cases while the latter is still below 1,000. |
37592.0 | 2020-03-20 00:00:00 UTC | When the Smoke Clears, Canopy Growth Stock Will Be a Winner | ACB | https://www.nasdaq.com/articles/when-the-smoke-clears-canopy-growth-stock-will-be-a-winner-2020-03-20 | nan | nan | InvestorPlace - Stock Market News, Stock Advice & Trading Tips
The selloff in the market and in Canopy Growth (NYSE:CGC) stock both continue. Markets plunged again earlier this week, and Canopy stock hasn’t been immune to the selling pressure. Now, shares trade back where they did in 2017.
Source: Jarretera / Shutterstock.com
As I’ve argued over the past few weeks, investors need to keep their cool. This selloff has not been easy and certainly has not been fun. But over time, the economy and the markets will recover.
In the meantime, however, the volatility is dispiriting. However, as I’ve told subscribers of my Cannabis Cash Weekly service, in these environments investors sometimes have to step back and let the chaos play out.
Taking that step back, the opportunity in CGC stock becomes more clear. The long-term growth opportunity in cannabis is delayed — not eliminated. Canopy is the industry’s leader, and should remain so. In fact, it may emerge with an even stronger position.
10 Stocks to Invest In for a Post-Coronavirus Whipsaw
Canopy isn’t going anywhere. This, too, shall pass — and when it does, CGC stock will rally sharply.
Canopy Cuts Back
Even before panic gripped the markets, it was becoming increasingly clear that the cannabis industry was headed for a shakeout. And that shakeout is almost guaranteed at this point.
In the sector as a whole, there is too much debt and too much capacity. Canopy chief executive officer David Klein made precisely that point in an interview on Feb. 14. “There’s not a lot of market demand for cannabis production facilities,” he told Yahoo! Finance. “There’s a lot of capacity in Canada and no logical buyers.”
That capacity is why Canopy announced earlier this month that it was closing two facilities in British Columbia. Furthermore, a greenhouse project in Ontario also is being canceled. Canopy isn’t throwing good money after bad.
Wall Street largely cheered the move — for good reason. It cuts Canopy’s costs, and in turn, speeds its path toward profitability. It also keeps the company from participating in “race to the bottom” pricing in wholesale cannabis.
It’s also a decision many other cannabis companies won’t be able to make.
An Industry Shakeout Looms
Canopy can make that decision because of its fortress balance sheet. In 2018, Constellation Brands (NYSE:STZ,NYSE:STZ.B) invested some $4 billion into Canopy Growth.
Much of that money has been spent. Canopy has made acquisitions, and spent heavily to build out production assets. In fact, it’s clear in retrospect that previous management spent too much. That’s a key reason why Constellation sent Klein — formerly its chief financial officer — to take the top spot at Canopy.
However, Canopy still has a good chunk of that cash remaining. As of Dec. 31, the company had 2.3 billion CAD (about $1.6 billion) in cash on its balance sheet. With losses coming down and long-term debt of just 536 million CAD ($373 million), the company is in excellent financial shape.
To put it simply, Canopy isn’t going bankrupt — but other producers will. There’s a real chance the equity in Aurora Cannabis (NYSE:ACB) gets wiped out, one reason I’ve long recommended even cannabis bulls avoid that name. Moreover, MedMen Enterprises (OTCMKTS:MMNFF) had to call off its acquisition of PharmaCann — likely due to financing worries. Its OTC stock price — just 19 cents — shows its desperate state.
The news is just as bad, if not worse, for many smaller, private operators. Those companies don’t have the cash to weather store closures or any short-term effects.
Canopy, however, does. And that positions it well going forward.
How CGC Stock Can Benefit
Certainly, a worldwide pandemic is not how anyone hoped the cannabis industry would become more rational. But it’s also likely that the response to the coronavirus from China simply will be the catalyst, not the cause. Given debt levels and overcapacity, many smaller operators were going to fail regardless.
That said, Canopy would benefit either way. In fact, a recent transaction shows how. Last week, Canopy and TerrAscend (OTCMKTS:TRSSF) entered into a loan agreement. Canopy is lending TerrAscend 80.5 million CAD, backed by TerrAscend’s assets.
The loan has an interest rate of 6.1% annually over the next decade — but that’s not the prize. Canopy also received more than 17 million warrants to buy TerrAscend shares, most of them at an exercise price of 3.74 CAD per share.
If TerrAscend, which currently trades below 2 CAD, posts a huge rally, Canopy will get its money back while also owning a nice chunk of the company at an attractive price.
If it doesn’t, though, Canopy has first claim on its assets, brands, and retail operations.
This kind of savvy deal is what Klein was hired to make. And it highlights the opportunities Canopy will have for the next few years. The company can patiently wait out the upheaval in its industry, and pick its spots to make investments that can drive significant value.
Of course, that’s exactly what investors should be doing right now. As they do so, they should give at least a long look to Canopy Growth stock.
Matthew McCall left Wall Street to actually help investors — by getting them into the world’s biggest, most revolutionary trends BEFORE anyone else. The power of being “first” gave Matt’s readers the chance to bank +2,438% in Stamps.com (STMP), +1,523% in Ulta Beauty (ULTA) and +1,044% in Tesla (TSLA), just to name a few. Click here to see what Matt has up his sleeve now. Matt does not directly own the aforementioned securities.
The post When the Smoke Clears, Canopy Growth Stock Will Be a Winner appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | There’s a real chance the equity in Aurora Cannabis (NYSE:ACB) gets wiped out, one reason I’ve long recommended even cannabis bulls avoid that name. However, as I’ve told subscribers of my Cannabis Cash Weekly service, in these environments investors sometimes have to step back and let the chaos play out. Canopy Cuts Back Even before panic gripped the markets, it was becoming increasingly clear that the cannabis industry was headed for a shakeout. | There’s a real chance the equity in Aurora Cannabis (NYSE:ACB) gets wiped out, one reason I’ve long recommended even cannabis bulls avoid that name. InvestorPlace - Stock Market News, Stock Advice & Trading Tips The selloff in the market and in Canopy Growth (NYSE:CGC) stock both continue. In 2018, Constellation Brands (NYSE:STZ,NYSE:STZ.B) invested some $4 billion into Canopy Growth. | There’s a real chance the equity in Aurora Cannabis (NYSE:ACB) gets wiped out, one reason I’ve long recommended even cannabis bulls avoid that name. InvestorPlace - Stock Market News, Stock Advice & Trading Tips The selloff in the market and in Canopy Growth (NYSE:CGC) stock both continue. Canopy Cuts Back Even before panic gripped the markets, it was becoming increasingly clear that the cannabis industry was headed for a shakeout. | There’s a real chance the equity in Aurora Cannabis (NYSE:ACB) gets wiped out, one reason I’ve long recommended even cannabis bulls avoid that name. InvestorPlace - Stock Market News, Stock Advice & Trading Tips The selloff in the market and in Canopy Growth (NYSE:CGC) stock both continue. Canopy, however, does. |
37593.0 | 2020-03-18 00:00:00 UTC | 2 Concerning Numbers That Highlight Some of the Biggest Marketing Challenges for the Cannabis Industry | ACB | https://www.nasdaq.com/articles/2-concerning-numbers-that-highlight-some-of-the-biggest-marketing-challenges-for-the | nan | nan | Cannabis company Canopy Growth (NYSE: CGC) has brought some big-name star power to its brand over the years, including Snoop Dogg, Martha Stewart, Drake, and Seth Rogen. But one of the challenges in the cannabis industry, especially in Canada where regulations are very rigid, is that Canopy Growth can't easily use its size, resources, or branding to its advantage. Spending a lot more on marketing may not pay off in the industry, and that's no more evident than in the following two numbers.
Thirty-five percent of cannabis consumers in Canada weren't sure what brand of product they purchased
Research company Brightfield Group has been following the industry's growth, and it found that more than one-third of Canadian consumers weren't even aware which brand of cannabis they had purchased. From that, we can derive that the brand didn't matter to at least one-third of customers. For investors who have seen the packaging of Canadian cannabis products, it's easy to understand why that's the case.
Unlike U.S. cannabis products that often have bright colors on them and attractive pictures, Canadian cannabis products are quite the opposite: plain white packaging with warning stickers taking up a lot of space and little to no room for a company to differentiate its products from others. It would take effort for a customer to ensure they're buying from a specific cannabis brand.
Image source: Getty Images.
Promotion of cannabis products is virtually nonexistent in Canada as well. That makes building any sort of brand loyalty in Canada difficult, even for large, well-known companies like Canopy Growth. While this arrangement may help level the playing field for smaller companies, it inhibits the potential growth for pot stocks because they can't use all of their available resources to help grow and market their brands the way other industries are able to. Brightfield did not release similar data on the U.S. market, and although advertising is also restrictive in that market, there's at least some room for companies to advertise through their products' appearance.
Thirty-seven percent of U.S. consumers are more likely to purchase a cannabis product if it has a celebrity endorsement
Brightfield Group also found that a celebrity endorsement positively affected an American consumer's likelihood of buying a cannabis product -- for 37% of those sampled. However, for 34% of customers, it made no difference at all. Brightfield also noted in its research that it found "celebrity testimonials to be among the least significant influences in driving them toward new cannabis products." It did not specify which other factors were important to consumers, but given the competition with the black market, it's likely that price plays more of a role for consumers when deciding which cannabis product to buy.
Key takeaways for investors
For investors, what's notable here is that there may not be a payoff for companies to invest heavily in marketing and in getting celebrities on board. While these things may not hurt, the data suggest that people aren't paying attention to brands and that even when they are, that likely doesn't affect their decision on which product to buy. Especially at a time when cash is more scarce than ever in the industry, cannabis companies may be better off cutting costs than being aggressive in their marketing efforts.
Canopy Growth is one of the larger, more notable marijuana brands in North America, and it has not been immune to the cannabis space's struggles over the past year:
CGC data by YCharts
Canopy hasn't fared much better than many of its peers, and the Horizons Marijuana Life Sciences ETF is down by a similar amount as well. The important takeaway for investors is that profitability and sustainability should be their top priority when investing in a pot stock. Being the biggest name -- or being the most popular -- isn't going to make an investment any more safe.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
David Jagielski has no position in any of the stocks mentioned. The Motley Fool recommends HEXO. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Cannabis company Canopy Growth (NYSE: CGC) has brought some big-name star power to its brand over the years, including Snoop Dogg, Martha Stewart, Drake, and Seth Rogen. But one of the challenges in the cannabis industry, especially in Canada where regulations are very rigid, is that Canopy Growth can't easily use its size, resources, or branding to its advantage. While this arrangement may help level the playing field for smaller companies, it inhibits the potential growth for pot stocks because they can't use all of their available resources to help grow and market their brands the way other industries are able to. | Cannabis company Canopy Growth (NYSE: CGC) has brought some big-name star power to its brand over the years, including Snoop Dogg, Martha Stewart, Drake, and Seth Rogen. Thirty-five percent of cannabis consumers in Canada weren't sure what brand of product they purchased Research company Brightfield Group has been following the industry's growth, and it found that more than one-third of Canadian consumers weren't even aware which brand of cannabis they had purchased. Thirty-seven percent of U.S. consumers are more likely to purchase a cannabis product if it has a celebrity endorsement Brightfield Group also found that a celebrity endorsement positively affected an American consumer's likelihood of buying a cannabis product -- for 37% of those sampled. | Thirty-five percent of cannabis consumers in Canada weren't sure what brand of product they purchased Research company Brightfield Group has been following the industry's growth, and it found that more than one-third of Canadian consumers weren't even aware which brand of cannabis they had purchased. Unlike U.S. cannabis products that often have bright colors on them and attractive pictures, Canadian cannabis products are quite the opposite: plain white packaging with warning stickers taking up a lot of space and little to no room for a company to differentiate its products from others. Thirty-seven percent of U.S. consumers are more likely to purchase a cannabis product if it has a celebrity endorsement Brightfield Group also found that a celebrity endorsement positively affected an American consumer's likelihood of buying a cannabis product -- for 37% of those sampled. | Thirty-five percent of cannabis consumers in Canada weren't sure what brand of product they purchased Research company Brightfield Group has been following the industry's growth, and it found that more than one-third of Canadian consumers weren't even aware which brand of cannabis they had purchased. Canopy Growth is one of the larger, more notable marijuana brands in North America, and it has not been immune to the cannabis space's struggles over the past year: CGC data by YCharts Canopy hasn't fared much better than many of its peers, and the Horizons Marijuana Life Sciences ETF is down by a similar amount as well. And make no mistake – it is coming. |
37594.0 | 2020-03-18 00:00:00 UTC | Start the Clock: The Cannabis Stock Delisting Countdown Has Begun | ACB | https://www.nasdaq.com/articles/start-the-clock%3A-the-cannabis-stock-delisting-countdown-has-begun-2020-03-18 | nan | nan | What do you get when a still-nascent industry that's been experiencing growing pains encounters the quickest descent into bear market territory in history for the stock market? The answer is an absolute rout for cannabis stocks.
To be fair, no industry has been immune to the concerns created by coronavirus disease 2019 or the subsequent haircut all of the major U.S. indexes have endured. But the marijuana industry has been particularly vulnerable for a variety of reasons.
Image source: Getty Images.
This bear market comes at a terrible time for the pot industry
For starters, Canada has been contending with supply problems since day one of legalization, all the way back on Oct. 17, 2018. Regulatory agency Health Canada was particularly slow in approving cultivation and licensing applications for pot growers, and it also wound up delaying the launch of high-margin derivatives (e.g., edibles, infused beverages, vapes, topicals, and concentrates) by two months.
Additionally, provincial regulators haven't exactly been helpful. Until the end of 2019, Canada's most-populous province, Ontario, had been working with a lottery system to assign licenses to dispensaries. This resulted in a meager 24 retail stores being open as of Oct. 17, 2019, the one-year anniversary of cannabis product sales commencing. For context, this is a province of 14.5 million people that could reasonably house 1,000 dispensaries.
In the United States, taxation has been the real threat to legal-channel sales growth. In states like California, consumers are being hit with already high state and local taxes, along with a 15% excise tax and a wholesale tax. Inclusive of other costs that may not be as visible, such as quality control testing, it's not inconceivable that Californians are paying an extra 50% on legal pot products. This makes it virtually impossible to compete against black-market producers.
Lastly, we're seeing financing concerns throughout North America. In the U.S., where marijuana remains a federally illegal substance, banks and credit unions continue to worry about the prospect of financial or criminal penalties for aiding pot companies. Meanwhile, in Canada, financial institutions have become leery about lending to cannabis companies given the rash of regulatory problems the industry has dealt with since sales began 17 months ago.
Image source: Getty Images.
A number of popular marijuana stocks may soon be delisted
For cannabis stocks, their growing pains being compounded with a very fearful stock market has proved to be the perfect storm. Now, with valuations severely depressed, the clock has started on what could be a mass-delisting for cannabis stocks trading on the New York Stock Exchange (NYSE) or Nasdaq.
As a reminder, the NYSE and Nasdaq require publicly traded companies listed on their exchanges to maintain a minimum $1 share. If a company's share price dips below $1 for a period of 30 days, it receives a delisting notice. Though these delisting notices can be appealed and extensions often granted, it's not a good look for the pot industry.
Even following the stock market's best single-day performance since 2008 on Friday, March 13, four marijuana stocks on major U.S. exchanges currently sit well below the $1 mark:
Aurora Cannabis (NYSE: ACB): $0.77
HEXO (NYSE: HEXO): $0.78
CannTrust Holdings (NYSE: CTST): $0.48
Sundial Growers (NASDAQ: SNDL): $0.74
CannTrust's fall from grace makes total sense following the admission that it had grown marijuana illegally in five unlicensed rooms at its flagship Niagara facility for a period of six months. CannTrust's cultivation and sales licenses have been suspended since September, and the company has already received a delisting notice from the NYSE.
As for Aurora Cannabis, HEXO, and Sundial, their declines have been real eye-openers. Aurora Cannabis has halted construction of two of its largest cultivation farms, laid off 500 workers, and has reworked its debt covenants. Likewise, HEXO has reduced about a third of its peak production capacity and laid off 200 workers from a variety of departments. As for Sundial, it recently saw its CEO depart and has been reeling from the possibility of facing lawsuits.
None of these four companies looks as if it has the tools to turn things around anytime soon. While a reverse split does remain an option and it is possible they reclaim the $1 minimum share price mark, there's a growing likelihood that 2020 will be remembered as the marijuana stock mass exodus (via delisting) from major U.S. exchanges.
Image source: Getty Images.
But wait -- there's more
Of course, these aren't the only four marijuana stocks that have to be worried about delisting.
For example, OrganiGram Holdings (NASDAQ: OGI) ended the week at only $1.64, and Aphria crossed the ticker tape at $2.25 per share. Both are Canadian growers exposed to the same growing pains as the four pot stocks facing possible delisting -- but OrganiGram just happens to be the best-performer of the bunch, at least based on income statements.
To date, OrganiGram is the only Canadian licensed producer that's been able to generate a no-nonsense quarterly operating profit. During the third quarter, OrganiGram's net sales, less its cost of goods sold and operating expenses, resulted in an operating profit of $1.2 million Canadian. This isn't exactly a profit to write home about, but it's the only pot stock that hasn't leaned on fair-value adjustments or other one-time benefits to generate a quarterly profit.
OrganiGram also boasts a number of other competitive advantages. It's one of a small number of licensed producers that has a supply agreement with every Canadian province, and its three-tiered growing system at its Moncton, New Brunswick, campus should lead to yields per square foot that more than double the industry average.
And yet, it may also be unable to avoid delisting if fear builds in the stock market and growing pains persist for the pot industry.
Earlier this year, I made a prediction that more marijuana stocks would be delisted from a major exchange than uplist to a major exchange. As of now, this prognostication looks as if it'll be correct.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Sean Williams owns shares of CannTrust Holdings Inc. The Motley Fool owns shares of and recommends OrganiGram Holdings. The Motley Fool recommends CannTrust Holdings Inc, HEXO., and Nasdaq. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Even following the stock market's best single-day performance since 2008 on Friday, March 13, four marijuana stocks on major U.S. exchanges currently sit well below the $1 mark: Aurora Cannabis (NYSE: ACB): $0.77 Regulatory agency Health Canada was particularly slow in approving cultivation and licensing applications for pot growers, and it also wound up delaying the launch of high-margin derivatives (e.g., edibles, infused beverages, vapes, topicals, and concentrates) by two months. While a reverse split does remain an option and it is possible they reclaim the $1 minimum share price mark, there's a growing likelihood that 2020 will be remembered as the marijuana stock mass exodus (via delisting) from major U.S. exchanges. | Even following the stock market's best single-day performance since 2008 on Friday, March 13, four marijuana stocks on major U.S. exchanges currently sit well below the $1 mark: Aurora Cannabis (NYSE: ACB): $0.77 CannTrust Holdings (NYSE: CTST): $0.48 Sundial Growers (NASDAQ: SNDL): $0.74 CannTrust's fall from grace makes total sense following the admission that it had grown marijuana illegally in five unlicensed rooms at its flagship Niagara facility for a period of six months. During the third quarter, OrganiGram's net sales, less its cost of goods sold and operating expenses, resulted in an operating profit of $1.2 million Canadian. | Even following the stock market's best single-day performance since 2008 on Friday, March 13, four marijuana stocks on major U.S. exchanges currently sit well below the $1 mark: Aurora Cannabis (NYSE: ACB): $0.77 A number of popular marijuana stocks may soon be delisted For cannabis stocks, their growing pains being compounded with a very fearful stock market has proved to be the perfect storm. Here's The Marijuana Stock You've Been Waiting For A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom. | Even following the stock market's best single-day performance since 2008 on Friday, March 13, four marijuana stocks on major U.S. exchanges currently sit well below the $1 mark: Aurora Cannabis (NYSE: ACB): $0.77 A number of popular marijuana stocks may soon be delisted For cannabis stocks, their growing pains being compounded with a very fearful stock market has proved to be the perfect storm. As for Aurora Cannabis, HEXO, and Sundial, their declines have been real eye-openers. |
37595.0 | 2020-03-17 00:00:00 UTC | Aurora Cannabis Founder Dumps 12 Million Shares, and Jefferies Is Not Amused | ACB | https://www.nasdaq.com/articles/aurora-cannabis-founder-dumps-12-million-shares-and-jefferies-is-not-amused-2020-03-17 | nan | nan | Terry Booth, the founder and one-time CEO of Aurora Cannabis (ACB), has just sold 12.2 million shares of the company he once ran -- a development, says Jefferies analyst Owen Bennett, that is "not great for sentiment" about the stock.
You don't say!
As Aurora announced in a press release Monday, "Terry Booth has filed a report on the System for Electronic Disclosure by Insiders (SEDI) regarding his sale of approximately 12,161,900 shares into the open market ... in connection with the previously announced transition of Mr. Booth's role within the Company." The transition in question being, of course, Booth's resignation as CEO announced last month.
Why is Booth selling now? One might imagine that, because Booth is leaving the company, he'd want to cut ties with Aurora entirely, and is therefore selling off his stake in order to make as clean a cut as possible. But as Bennett points out, Booth "remains in a strategic advisor role" at the company. He has not in fact cut ties entirely. Moreover, as an important advisor to Aurora Cannabis, he presumably has a good insider's vantage point to how things are going within Aurora, and what the company's prospects look like.
In Bennett's estimation, Monday's stock sale suggests that Booth may see "some more difficult times ahead."
Which is not to say that the times behind Aurora have been all unicorns and rainbows. Indeed, a chart of Aurora Cannabis's fortunes over the past 12 months shows an almost straight line down from the top left axes to the bottom right, as Aurora Cannabis stock has sunk from a share price of nearly $10 a year ago, to $0.70 today -- a decline of 93%.
Most recently, Bennett notes, the company has lost its Chief Corporate Officer (Cam Battley, who resigned in December), followed by an announcement of a restructuring plan, including new "ambitious profitability targets" that no one seems to have much faith in.
Fact is, most analyst estimates still don't see Aurora turning GAAP profitable before 2023 at the earliest -- and the way things are going, the company may not make it that long. At last report, Aurora Cannabis was deeply unprofitable ($1.1 billion lost last year), burning cash (about $610 million burnt last year), and mired in debt (nearly $350 million in long term debt, against cash reserves of only about $140 million).
Sure, to hear management tell it, Aurora remains "the Canadian company defining the future of cannabis worldwide." Executive Chairman and Interim CEO Michael Singer still insists, "the Board and management remain focused on the plan we laid out in February and we are progressing as planned toward appropriate capital allocation, balance sheet strength, and profitability." And even Booth says he's only selling because "market volatility with respect to COVID-19 and a number of opportunities in the industry led to me taking some cash to the sidelines ... I believe many cannabis stocks including Aurora are undervalued and I will be watching present market conditions unfold. I will definitely be considering buying back in once the dust settles."
Regardless, actions speak louder than words. Investors owning the stock today, and seeing its founder dumping his shares -- even with an expressed intention of perhaps buying back later -- might now be thinking to themselves "maybe we should think about buying back later, too, but for now -- sell!"
Turning now to the rest of the Street, it appears that other analysts are generally on the same page. With 12 Holds, 4 Sells, and just single Buy, the consensus rating comes in as a Hold. The average price target among these analysts stands at $1.87, which is about 165% higher than ACB's current value -- most likely a result of the quick drop and analysts’ inability to turnaround new price targets so quickly. (See Aurora Cannabis stock analysis on TipRanks)
To find good ideas for cannabis stocks trading at attractive valuations, visit TipRanks’ Best Stocks to Buy, a newly launched tool that unites all of TipRanks’ equity insights.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | Terry Booth, the founder and one-time CEO of Aurora Cannabis (ACB), has just sold 12.2 million shares of the company he once ran -- a development, says Jefferies analyst Owen Bennett, that is "not great for sentiment" about the stock. The average price target among these analysts stands at $1.87, which is about 165% higher than ACB's current value -- most likely a result of the quick drop and analysts’ inability to turnaround new price targets so quickly. Most recently, Bennett notes, the company has lost its Chief Corporate Officer (Cam Battley, who resigned in December), followed by an announcement of a restructuring plan, including new "ambitious profitability targets" that no one seems to have much faith in. | Terry Booth, the founder and one-time CEO of Aurora Cannabis (ACB), has just sold 12.2 million shares of the company he once ran -- a development, says Jefferies analyst Owen Bennett, that is "not great for sentiment" about the stock. The average price target among these analysts stands at $1.87, which is about 165% higher than ACB's current value -- most likely a result of the quick drop and analysts’ inability to turnaround new price targets so quickly. In Bennett's estimation, Monday's stock sale suggests that Booth may see "some more difficult times ahead." | Terry Booth, the founder and one-time CEO of Aurora Cannabis (ACB), has just sold 12.2 million shares of the company he once ran -- a development, says Jefferies analyst Owen Bennett, that is "not great for sentiment" about the stock. The average price target among these analysts stands at $1.87, which is about 165% higher than ACB's current value -- most likely a result of the quick drop and analysts’ inability to turnaround new price targets so quickly. As Aurora announced in a press release Monday, "Terry Booth has filed a report on the System for Electronic Disclosure by Insiders (SEDI) regarding his sale of approximately 12,161,900 shares into the open market ... in connection with the previously announced transition of Mr. Booth's role within the Company." | Terry Booth, the founder and one-time CEO of Aurora Cannabis (ACB), has just sold 12.2 million shares of the company he once ran -- a development, says Jefferies analyst Owen Bennett, that is "not great for sentiment" about the stock. The average price target among these analysts stands at $1.87, which is about 165% higher than ACB's current value -- most likely a result of the quick drop and analysts’ inability to turnaround new price targets so quickly. Why is Booth selling now? |
37596.0 | 2020-03-17 00:00:00 UTC | 1 Country Just Legalized Medical Marijuana and Another May Be on the Way | ACB | https://www.nasdaq.com/articles/1-country-just-legalized-medical-marijuana-and-another-may-be-on-the-way-2020-03-17 | nan | nan | Marijuana legalization has made significant progress over the years, and Malawi is the latest country to permit its use. The African country of about 19 million people will now allow cannabis to be used in medicine and in the creation of hemp fibers. While it doesn't permit the recreational use of marijuana, it's another significant step forward for Africa, where Zambia, Zimbabwe, Lesotho, and South Africa have all loosened their laws relating to cannabis.
With North American cannabis companies struggling over the past year, this is a welcome sign for investors, as it means there will be more options to invest in other parts of the world. For companies, it also creates the opportunity to import pot from other regions where it's cheaper and easier to grow year-round. And the good news is that there's another country that may soon be about to legalize pot.
Lebanon looks to legalize medical marijuana
The Middle East is a potential hotbed for cannabis cultivation, and Lebanon has a history of it that goes back more than 100 years. With a population of 6 million, the country isn't as big as Malawi, but there's significant potential for marijuana production there.
Lawmakers drafted a bill that permits cannabis where the tetrahydrocannabinol (THC) levels are below 1%. It's not enough for users to get high, but there can be many medical applications for it. In 2018, the U.S. legalized hemp, which is cannabis characterized by very low levels of THC -- 0.3% or less.
Image source: Getty Images.
In Lebanon, the draft legislation is awaiting a final vote. No date is set as to when that might happen, and the country has been working on legalizing medical marijuana for multiple years in the hopes of boosting its economy. Yassine Jaber, one of the members of the Lebanon Parliament who helped draft the bill, believes that Lebanon has "a competitive advantage in the cannabis business" and that "our soil is among the best in the world for this, and the cost of production is low compared to other states."
As countries open up to cannabis, it creates opportunities for foreign companies to expand there.
Canopy Growth to expand into Israel
Earlier this month, Canada-based cannabis producer Canopy Growth (NYSE: CGC) announced it was working on a deal with Univo Pharmaceuticals (TASE: UNVO) to market and sell medical marijuana products in Israel. Not only is this an opportunity to reach a new market, but under the agreement, Canopy Growth would be able to utilize Univo's facilities to help export its products into other European countries -- once it's legal to do so. Medical marijuana is legal in Israel, and the country's conducted a lot of research and development on cannabis over the years.
The move by Canopy Growth is just the latest example of how it and its rival Aurora Cannabis (NYSE: ACB) have been expanding to other countries in the hopes of not just gaining first-mover advantages, but securing low-cost supplies of cannabis as well. Unfortunately, it's a long-term strategy that hasn't paid off just yet, with both companies still struggling to stay out of the red.
Should investors expect more foreign expansion?
The opportunity to get into foreign markets like Malawi, Israel, and perhaps Lebanon soon could be very attractive to companies like Aurora and Canopy Growth. But with cannabis investors focused on profitability more than ever before, it may not be feasible in the near term. Many cannabis producers are looking for ways to conserve cash rather than spend more of it, and that's likely the largest impediment to foreign expansion today.
However, for investors, it's an opportunity to look for new up-and-coming pot stocks from countries that legalize cannabis. With lower-cost production, they may prove to be better investments with more realistic expectations of profitability. Currently, North American pot stocks remain very risky, as is evidenced by the markets where the Horizons Marijuana Life Sciences ETF has fallen nearly 80% in the past 12 months while the S&P 500 has declined a much more modest 12%.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
David Jagielski has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | The move by Canopy Growth is just the latest example of how it and its rival Aurora Cannabis (NYSE: ACB) have been expanding to other countries in the hopes of not just gaining first-mover advantages, but securing low-cost supplies of cannabis as well. With North American cannabis companies struggling over the past year, this is a welcome sign for investors, as it means there will be more options to invest in other parts of the world. Not only is this an opportunity to reach a new market, but under the agreement, Canopy Growth would be able to utilize Univo's facilities to help export its products into other European countries -- once it's legal to do so. | The move by Canopy Growth is just the latest example of how it and its rival Aurora Cannabis (NYSE: ACB) have been expanding to other countries in the hopes of not just gaining first-mover advantages, but securing low-cost supplies of cannabis as well. With North American cannabis companies struggling over the past year, this is a welcome sign for investors, as it means there will be more options to invest in other parts of the world. With a population of 6 million, the country isn't as big as Malawi, but there's significant potential for marijuana production there. | The move by Canopy Growth is just the latest example of how it and its rival Aurora Cannabis (NYSE: ACB) have been expanding to other countries in the hopes of not just gaining first-mover advantages, but securing low-cost supplies of cannabis as well. Canopy Growth to expand into Israel Earlier this month, Canada-based cannabis producer Canopy Growth (NYSE: CGC) announced it was working on a deal with Univo Pharmaceuticals (TASE: UNVO) to market and sell medical marijuana products in Israel. Medical marijuana is legal in Israel, and the country's conducted a lot of research and development on cannabis over the years. | The move by Canopy Growth is just the latest example of how it and its rival Aurora Cannabis (NYSE: ACB) have been expanding to other countries in the hopes of not just gaining first-mover advantages, but securing low-cost supplies of cannabis as well. Marijuana legalization has made significant progress over the years, and Malawi is the latest country to permit its use. However, for investors, it's an opportunity to look for new up-and-coming pot stocks from countries that legalize cannabis. |
37597.0 | 2020-03-16 00:00:00 UTC | Cronos Stock Watchers Should Wait For Further Declines Before Buying | ACB | https://www.nasdaq.com/articles/cronos-stock-watchers-should-wait-for-further-declines-before-buying-2020-03-16 | nan | nan | InvestorPlace - Stock Market News, Stock Advice & Trading Tips
Is today a good time to buy Cronos Group (NASDAQ:CRON) stock? The “Cannabisphere” is a hot mess, to say the least. But, backed by tobacco giant Altria Group (NYSE:MO), Cronos stock may have the cash and support to survive the maelstrom. As rivals scramble to sell assets and raise capital, this major pot company could be a buyer in a seller’s market.
Source: Shutterstock
Yet, valuation may be a reason not to buy at today’s prices. Thanks to its strong balance sheet, Cronos trades at a premium. It’s a similar situation to what we see at Canopy Growth (NYSE:CGC). The underlying industry may be in turmoil. But thanks to a cash-rich balance sheet, and a deep-pocketed strategic partner, shares continue to be valued higher than, say, Aurora Cannabis (NYSE:ACB) or Hexo (NYSE:HEXO).
Nevertheless, paying a premium could be a rational move. Cronos stock could soar higher in the next few years. Why? Their unique strategy. Focusing on the marketing and sales aspect — as opposed to production — Cronos could have the edge as integrated pot producers shut down or sell off facilities.
Buy the Dip in These 7 Online Advertising Stocks Now
With this in mind, let’s dive in and see what’s the verdict on Cronos shares.
Why Cronos Stock Could Rebound
It’s safe to say that Canadian-based pot stocks face many issues. Oversupply and regulatory headwinds persist. Add the long-shot odds of U.S. federal-level legalization. Put it all together, and it doesn’t seem smart to buy pot stocks today.
But Cronos stock could be the exception. At least according to MKM Partners’ Bill Kirk. The analyst recently upgraded shares to Buy from Hold. The reason? Namely, the Altria connection. Thanks to the tobacco giant’s existing relationships with convenience store chains, Cronos has a big infrastructure edge if and when recreational pot use is legal nationwide in the United States.
Also, Kirk is bullish on Cronos thanks to its large cash position. Out of a $1.9 billion market capitalization (based on the March 11 closing price of $5.41 per share), the company has $1.5 billion in its coffers.
Yes, the company hemorrhages cash like its peers. But, thanks to an asset-light approach, cash burn is lower than that of Canopy or Aurora. With Cronos’ business model, you can see the similarities between it and its partner, Altria.
Most marijuana companies have tried to handle all aspects of pot production. From operating growing facilities to selling it in retail locations. Cronos is using the tobacco industry playbook. Altria and the other U.S.-based tobacco companies don’t own tobacco farms. They buy it wholesale, process it into cigarettes and other tobacco products, and sell it via third-party retailers at a high markup. The same high-margin business model could be applied to the recreational pot space.
Kirk makes a compelling case for Cronos as one of the best pot stocks. Yet, that doesn’t make shares a buy at today’s prices. Especially with valuation and other red flags being key downside risks.
Watch Out for Valuation and Other Red Flags
Despite shares taking a beating in recent months, Cronos stock remains overvalued. Shares trade at an enterprise value/sales ratio of 17. That’s higher than even richly priced Canopy Growth’s EV/Sales ratio of 12.5.
Looking at the other pot names, the valuation discrepancy is even wider. Tilray (NASDAQ:TLRY) has an EV/Sales ratio of 7, while Aurora and Hexo are each under 6.
You could argue the Crono’s strong balance sheet warrants a premium. Yet, there other factors at play that should give investors pause. As InvestorPlace’s Wayne Duggan wrote March 5, Cronos is delaying earnings due to an audit of its finances. In addition, the company expects to take a massive write-down on inventory. If these risks turn out worse than anticipated, shares could dive even lower.
The 10 Best Stocks to Buy After The Market’s Historic Sell-Off
With this in mind, why buy now? These risk factors, along with a stock market trending lower, make near-term downside more likely than upside.
Wait-And-See May be the Best Approach
Bottom line on Cronos stock: consider it a buy … at a lower price. While shares have fallen more than 75% from their 52-week high, the stock is not exactly cheap. You could argue that the company could grow into its valuation. But, with the ongoing audit and weak fundamentals in the Canadian pot market, it’s hard to put much faith in future results.
On the other hand, Cronos’ underlying business model could be a solid path to future profitability. While peers try to handle all aspects of pot production, Cronos is smartly employing the tobacco industry playbook. This could help the company evolve into a cash-cow business.
Add in the Altria connection, and Cronos stock could be a big winner. But that’s over a long time horizon.
Even with changes in the NFL marijuana policy likely to stir up sentiment this week, the best play is to wait for shares to reach a more reasonable valuation.
Thomas Niel, contributor to InvestorPlace, has been writing single-stock analysis for web-based publications since 2016. As of this writing, Thomas Niel did not hold a position in any of the aforementioned securities.
The post Cronos Stock Watchers Should Wait For Further Declines Before Buying appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | But thanks to a cash-rich balance sheet, and a deep-pocketed strategic partner, shares continue to be valued higher than, say, Aurora Cannabis (NYSE:ACB) or Hexo (NYSE:HEXO). But, backed by tobacco giant Altria Group (NYSE:MO), Cronos stock may have the cash and support to survive the maelstrom. Focusing on the marketing and sales aspect — as opposed to production — Cronos could have the edge as integrated pot producers shut down or sell off facilities. | But thanks to a cash-rich balance sheet, and a deep-pocketed strategic partner, shares continue to be valued higher than, say, Aurora Cannabis (NYSE:ACB) or Hexo (NYSE:HEXO). InvestorPlace - Stock Market News, Stock Advice & Trading Tips Is today a good time to buy Cronos Group (NASDAQ:CRON) stock? But, backed by tobacco giant Altria Group (NYSE:MO), Cronos stock may have the cash and support to survive the maelstrom. | But thanks to a cash-rich balance sheet, and a deep-pocketed strategic partner, shares continue to be valued higher than, say, Aurora Cannabis (NYSE:ACB) or Hexo (NYSE:HEXO). InvestorPlace - Stock Market News, Stock Advice & Trading Tips Is today a good time to buy Cronos Group (NASDAQ:CRON) stock? Buy the Dip in These 7 Online Advertising Stocks Now With this in mind, let’s dive in and see what’s the verdict on Cronos shares. | But thanks to a cash-rich balance sheet, and a deep-pocketed strategic partner, shares continue to be valued higher than, say, Aurora Cannabis (NYSE:ACB) or Hexo (NYSE:HEXO). InvestorPlace - Stock Market News, Stock Advice & Trading Tips Is today a good time to buy Cronos Group (NASDAQ:CRON) stock? With Cronos’ business model, you can see the similarities between it and its partner, Altria. |
37598.0 | 2020-03-15 00:00:00 UTC | How Low Does Aurora Cannabis Need to Go Before the Marijuana Stock Is a Buy? | ACB | https://www.nasdaq.com/articles/how-low-does-aurora-cannabis-need-to-go-before-the-marijuana-stock-is-a-buy-2020-03-15 | nan | nan | Nearly everything has a price at which it's a good deal. That's true whether we're talking about cars, houses, or stocks. Of course, the less desirable a given item is, the lower the price is where it makes sense to buy it.
That leads me to Aurora Cannabis (NYSE: ACB). There's no need to sugarcoat it: Aurora is a hot mess right now. It's losing money big-time. It's looking for a new CEO. Its stock has lost more than 90% of its value over the last 12 months.
How low does Aurora have to go before the marijuana stock is a buy? It's complicated.
Image source: Getty Images.
The biggest problem
There's one glaring problem for Aurora that arguably outweighs all of the company's other problems -- its debt. Aurora reported current loans and borrowings of close to 300 million in Canadian dollars as of Dec. 31, 2019. But add to that the company's nearly CA$302 million in convertible debentures and Aurora's total debt stands at around CA$602 million.
If times were good for Aurora, those convertible debentures wouldn't be too much of a concern. Holders of the senior convertible notes issued by the company would be likely to convert those notes to shares if Aurora stock was steadily rising. That's not the case right now, though. Unless something changes, Aurora is going to have a huge amount of debt to pay over the next few years.
In the past, Aurora has done what many other companies do when convertible debentures mature: It issued new convertible notes with expiration dates farther in the future to pay off the old notes. However, taking this approach becomes increasingly more difficult the lower Aurora's share price goes.
To make matters worse, Aurora remains unprofitable and could need to raise more cash in the future to fund operations. Sure, the company intends to meet positive EBITDA thresholds beginning in fiscal 2021 Q1 as part of its restructured debt covenants. However, positive EBITDA isn't the same as true profitability. Also, there's no guarantee that Aurora will be able to do what it says it will do.
From trash to treasure
Let's assume, though, that Aurora can make significant progress toward profitability. There are some reasons for optimism on that front. Aurora has taken steps to cut expenses, including announcing major staff cuts. The situation is dire enough that the company has no choice but to implement strict fiscal discipline.
Also, Aurora's revenue should rise. Ontario is issuing more licenses for retail cannabis stores, at least partially alleviating a major obstacle for Aurora and its peers. The Cannabis 2.0 market for cannabis derivatives products is picking up momentum. Aurora CFO Glen Ibbott stated in the company's Q2 conference call last month that 20% of Q3 sales will likely be from Cannabis 2.0 products.
Remember, too, that Aurora took a big revenue hit in the second quarter because its license in Germany's medical cannabis market was temporarily suspended. The company's European sales should improve going forward now that this license has been restored.
What would happen if Aurora's sales soar and its bottom line improves significantly? I suspect that its stock would rebound nicely. And that would help the company in addressing its debt-related issues.
A guesstimate
No more beating around the bush (or cannabis plant). It's time to attempt to answer our central question of how low Aurora's share price needs to go to make the stock a compelling buy. At best, all we can do is make a guesstimate, but here's my take.
In an absolute worst-case scenario where Aurora goes bankrupt and shuts its doors, buying the stock wouldn't be a smart move even if its share price went to one penny. But I don't think that's going to happen.
Could Aurora declare bankruptcy in the future? Yes, it could. However, my expectation is that if that occurred the company would file for the Canadian equivalent of a Chapter 11 bankruptcy in the U.S., where the company is restructured but remains in business. My view, though, is that it won't get to that point. None of Aurora's creditors want that outcome, because they'll lose a ton of money.
The property, plant, and equipment item on Aurora's balance sheet totals close to CA$1 billion. Aurora's market is currently close to the reported value of its physical assets. My view is that if the stock falls another 15% to 20%, there's a solid case to be made for buying the beleaguered stock even if the near-worst scenario happens.
Does it have to really go that low? Probably not. Aurora remains a top cannabis producer in terms of capacity and market share. It also has a low cost structure thanks to its high-tech production facilities. The cannabis market in Canada and Germany, two markets where Aurora already ranks as a leader, continue to grow. It's entirely possible that the answer to how low Aurora needs to go to make it a buy could be as low as it is right now.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Keith Speights has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | That leads me to Aurora Cannabis (NYSE: ACB). It's time to attempt to answer our central question of how low Aurora's share price needs to go to make the stock a compelling buy. In an absolute worst-case scenario where Aurora goes bankrupt and shuts its doors, buying the stock wouldn't be a smart move even if its share price went to one penny. | That leads me to Aurora Cannabis (NYSE: ACB). But add to that the company's nearly CA$302 million in convertible debentures and Aurora's total debt stands at around CA$602 million. However, taking this approach becomes increasingly more difficult the lower Aurora's share price goes. | That leads me to Aurora Cannabis (NYSE: ACB). How low does Aurora have to go before the marijuana stock is a buy? Holders of the senior convertible notes issued by the company would be likely to convert those notes to shares if Aurora stock was steadily rising. | That leads me to Aurora Cannabis (NYSE: ACB). How low does Aurora have to go before the marijuana stock is a buy? However, positive EBITDA isn't the same as true profitability. |
37599.0 | 2020-03-15 00:00:00 UTC | 4 Ways Coronavirus Can Affect the Marijuana Industry | ACB | https://www.nasdaq.com/articles/4-ways-coronavirus-can-affect-the-marijuana-industry-2020-03-15 | nan | nan | In case you missed it, the World Health Organization (WHO) made the announcement that most people were expecting this past Wednesday, March 11: Coronavirus disease 2019 (COVID-19) is officially a pandemic.
The COVID-19 lung-focused illness has cropped up in 110 countries around the world, has been confirmed in close to 114,000 people, and has led to over 4,000 deaths, according to WHO as of March 10. Given COVID-19's higher mortality rate among the elderly and people with compromised immune systems, this has led to seemingly unprecedented global responses at the governmental level, including a complete lockdown in Italy, as well as a halt to college classes, special events, and major gatherings in certain U.S. states.
The thing is, coronavirus isn't just affecting the physical well-being of the world -- it's also wreaking havoc on financial markets, and it has the ability to adversely affect supply chains in a variety of sectors and industries.
For example, you might think the fast-growing marijuana industry would be mostly exempt from coronavirus-induced panic. Unfortunately, that couldn't be further from the truth. Here are four ways that coronavirus could affect the cannabis industry.
Image source: Getty Images.
1. Supply chain disruption
The biggest issue will likely come in the form of supply chain disruption. Although we often think of cannabis in terms of growing and processing the plant within the confines of, say, the United States or Canada, there are a lot of moving parts of the supply chain that originate from China. That's because China is a low-cost producer, which is perfect for the still-nascent pot industry.
For example, cannabis companies rely on China for vaporizer production. Anything tied to vaping is expected to lead all forms of derivatives in terms of sales, but this may not prove the case if China is unable to meet its production commitments. In particular, this could prove to be an issue for KushCo Holdings (OTC: KSHB), which has generated most of its sales to date from vaporizers. KushCo is also a key supplier of packaging materials, some of which are derived from China. Although KushCo has previously stuck by its healthy sales growth guidance, this may not be the case going forward.
Other supply chain disruptions could involve heating, ventilation, and air conditioning products, as well as LED bulbs. Even though cultivators have typically leaned on high-pressure sodium bulbs for their growing, LED bulbs, such as those provided by Cree (NASDAQ: CREE), are considerably cheaper over the long run, and they create less heat, which can reduce climate control expenses. The thing is, Cree has a significant LED production operation in China, meaning it could easily be disrupted.
Image source: Getty Images.
2. Trade-show cancellations
As we've witnessed in both Italy and in select U.S. states, sporting events and any sort of large gatherings are being discouraged or outright cancelled indefinitely to mitigate the spread of coronavirus. This will almost certainly include a number of important trade shows for the marijuana industry, which are set to place in the U.S., Canada, and Europe in the coming months.
Marijuana trade shows are a prime time for pot stocks to show off their latest innovative products, as well as network. This is especially true with derivatives, such as edibles, vapes, infused beverages, topicals, and concentrates having recently hit dispensary shelves. However, with the prospect of trade shows being cancelled, it puts certain cannabis stocks in a real bind.
As an example, Aurora Cannabis (NYSE: ACB) is very much in need of a brand-name partnership at the moment and will need a big push from the launch of edibles and vapes to make a dent in its monstrous quarterly operating losses. Aurora's most recent management discussion and analysis suggests that the company's liabilities will total $373.6 million Canadian over the next 12 months, but Aurora had less than half of this amount in cash, cash equivalents, and marketable securities on hand, as of Dec. 31, 2019. The inability to make in-person inroads could prove problematic for the once highflier.
Image source: Getty Images.
3. A significant drop-off in tourism
Another issue with the coronavirus is that it might crush regions that are dependent on tourism to drive growth. A good example here would be Las Vegas, which is relatively reliant on an influx of tourism to driving gaming and hotel revenue, as well as plenty of additional ancillary spending.
Planet 13 Holdings (OTC: PLNH.F), for instance, has its 112,000-square-foot SuperStore situated just west of the Las Vegas Strip. Planet 13's dispensary complex -- the largest in the country by a long shot -- features a broad selection of marijuana products, as well as a bistro, events center, and consumer-facing processing center. The SuperStore also leans heavily on technology to enhance the experience of its customers.
However, if the spread of COVID-19 significantly reduces travel or tourism to Las Vegas, it's a company like Planet 13 that could feel the effects. Planet 13 will have a new 40,000-square-foot dispensary open in Santa Ana, Calif., just miles from Disneyland, later this year, but the short-term pain from travel disruptions could certainly translate into weaker sales at its flagship store.
Image source: Getty Images.
4. Potential quarantines or select regional lockdowns
Lastly, there's always the possibility that certain countries, regions, states, or cities could go on lockdown, or that more and more people become infected with the coronavirus and are forced to self-quarantine. People who are quarantined may be able to receive cannabis products via delivery in certain areas, but it would be a reasonable assumption that demand would drop if the number of confirmed COVID-19 cases continues to climb.
We're not at this point yet, but it remains an outlier that could disrupt the cannabis industry.
Here's The Marijuana Stock You've Been Waiting For
A little-known Canadian company just unlocked what some experts think could be the key to profiting off the coming marijuana boom.
And make no mistake – it is coming.
Cannabis legalization is sweeping over North America – 11 states plus Washington, D.C., have all legalized recreational marijuana over the last few years, and full legalization came to Canada in October 2018.
And one under-the-radar Canadian company is poised to explode from this coming marijuana revolution.
Because a game-changing deal just went down between the Ontario government and this powerhouse company...and you need to hear this story today if you have even considered investing in pot stocks.
Simply click here to get the full story now.
Learn more
Sean Williams owns shares of KushCo Holdings. The Motley Fool owns shares of and recommends Planet 13 Holdings Inc. The Motley Fool recommends KushCo Holdings. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. | As an example, Aurora Cannabis (NYSE: ACB) is very much in need of a brand-name partnership at the moment and will need a big push from the launch of edibles and vapes to make a dent in its monstrous quarterly operating losses. Given COVID-19's higher mortality rate among the elderly and people with compromised immune systems, this has led to seemingly unprecedented global responses at the governmental level, including a complete lockdown in Italy, as well as a halt to college classes, special events, and major gatherings in certain U.S. states. Planet 13 will have a new 40,000-square-foot dispensary open in Santa Ana, Calif., just miles from Disneyland, later this year, but the short-term pain from travel disruptions could certainly translate into weaker sales at its flagship store. | As an example, Aurora Cannabis (NYSE: ACB) is very much in need of a brand-name partnership at the moment and will need a big push from the launch of edibles and vapes to make a dent in its monstrous quarterly operating losses. Supply chain disruption The biggest issue will likely come in the form of supply chain disruption. However, if the spread of COVID-19 significantly reduces travel or tourism to Las Vegas, it's a company like Planet 13 that could feel the effects. | As an example, Aurora Cannabis (NYSE: ACB) is very much in need of a brand-name partnership at the moment and will need a big push from the launch of edibles and vapes to make a dent in its monstrous quarterly operating losses. The thing is, coronavirus isn't just affecting the physical well-being of the world -- it's also wreaking havoc on financial markets, and it has the ability to adversely affect supply chains in a variety of sectors and industries. Planet 13's dispensary complex -- the largest in the country by a long shot -- features a broad selection of marijuana products, as well as a bistro, events center, and consumer-facing processing center. | As an example, Aurora Cannabis (NYSE: ACB) is very much in need of a brand-name partnership at the moment and will need a big push from the launch of edibles and vapes to make a dent in its monstrous quarterly operating losses. Anything tied to vaping is expected to lead all forms of derivatives in terms of sales, but this may not prove the case if China is unable to meet its production commitments. This will almost certainly include a number of important trade shows for the marijuana industry, which are set to place in the U.S., Canada, and Europe in the coming months. |
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