What’s Next for Aurora Cannabis Stock?
Aurora Cannabis Inc (CVE:ACB) has both reasons to be excited and reasons to be apprehensive about marijuana legalization prospects moving forward. Aurora Cannabis stock was down five percent on Wednesday, despite having gained six percent the day after the Canadian federal government’s task force released recommendations concerning the pot regulation process.
The Canadian fed’s report was largely positive for the recreational marijuana industry when it was released Tuesday. Some of the highlights include recommending that the legal age limit be set at 18 and that consumers be allowed to carry up to 30 grams in personal possession. Aurora Cannabis stock was one of the biggest pot stock beneficiaries of the announcement, but has since had a regression in its share price. (Source: “Aurora Cannabis targeting 100,000 kg per year by 2017,” Financial Post, December 14, 2017.)
But the company has not had all bad news. A potential boon for Aurora Cannabis stock lies in the recent growing facility that the company is constructing. The weed producer broke ground on a new 800,000 square foot growing facility that it says will have an output of 100,000 kilograms of dried product by 2018. Construction is expected to be completed by October 2017.
The company is hoping that this investment in expanded production capability will allow Aurora Cannabis stock to soar as it prepares the company for scaled production.
In a podcast interview, Aurora Cannabis CEO Terry Booth said that the major benefit to this new facility is the ability to stop and start as it sees fit. With 250,000 to 300,000 square feet of the new complex completed, the company would be able to grow marijuana in that space in late spring 2017.
Then, as the legalization process waxes or wanes, the company can halt construction on the rest of the facility and simply focus on growing in the completed areas.
And those delays have some investors spooked.
Brendan Kennedy, CEO of a cannabis industry private investment firm based out of Seattle called Privateer Holdings, counts himself among those who feel the Canadian government will be slower than promised in getting the legalization process through. He told the Economic Club of Canada on December 1, 2016, that he doesn’t think the recreational regime will be in place even by 2020.
Whether or not the Canadian feds hit their timeline can potentially have huge ramifications on the recreational marijuana industry and therefore Aurora Cannabis stock, among other prominent pot stocks.