Marijuana Stock Alert: Is Aurora Cannabis Bouncing Back?
Aurora Cannabis
(NYSE: ACB) cannabis stock shares shot up over 25% Thursday morning after the company announced its intent to acquire Reliva, a US-based CBD retailer. This monumental acquisition enables Aurora Cannabis to enter the US CBD market and diversify its product offerings. Is this Cannabis Industry Giant Bouncing Back?
This is great news for the once “king” of the cannabis industry. As of last year, Robinhood, the popular online stock trading platform, announced that nearly 500,000 of its users owned the shares of Aurora Cannabis stock. Over the past twelve months, Aurora shares have tanked by an astounding 89% – attributed mostly to lack of profitability.
While the acquisition is great news, there’s still an abundance of concern with Aurora’s long-term financials.
Is Aurora Cannabis Stock Bouncing Back?
Aurora Cannabis stock investors were certainly pleased with the recent fiscal Q3 earnings report as the results were better than anticipated. Yes, Aurora posted a net loss of CA$137.4 million. However, the company was able to do some serious damage control – having course-corrected from the unfathomable CA$1.3 billion net loss during fiscal Q2. Aurora also has a decent cash position for the short-term and an option to raise another CA$350 million in equity financing, if needed.
Should I Buy Aurora Cannabis Stock Now?
Sure, this quarter’s net loss is a substantial improvement but the company is still far from profitability. There are much better cannabis stock plays out there as other cannabis companies are currently crushing. At Cannin, we remain loyal fans of companies like Green Thumb Industries (OTC: GTBIF) as they continue to announce record revenues and much smaller net losses than Aurora.
Aurora Cannabis Stock Recommendation
While Aurora Cannabis seems to be correcting the course – the company’s long-term profitability is still a huge question. They do have enough cash to cover short-term expenses but one slip could sink the Aurora ship. There are plenty of other cannabis and hemp stocks trading at deep discounts so we recommend not buying any shares in Aurora Cannabis anytime soon.
Marijuana Stock Alert: Is Aurora Cannabis Bouncing Back?
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