Aphria Stock Forecast
One of the most intriguing stocks on the market right now is Aphria Inc (OTCMKTS:APHQF, TSE:APH).
I’ve written about Aphria for over a year and a half, and we’ve seen the company’s value rise by about 161% in that time. But lately, the Aphria stock forecast has been much more volatile, with some investors cursing its name and others praising the gains they’ve made.
So, what does the future hold for APH stock?
In order to understand where Aphria stock currently sits, you have to consider the ride it has been on in 2018.
You see, the stock price is down about 40% year-to-date. This stock, in fact, was one of the hardest hit in the correction that hit the legal marijuana industry in the first half of this year.
But, with that major fall in value came an opportunity. After all, one of the major reasons we saw the correction was that stocks were being deemed overvalued and investors pulled back as a result.
Dropping by 40% will go a long way to assuage some of those concerns and once again draw investor interest.
I predicted that we would see an uptick in Aphria stock’s value. That ended up happening in May, with several weeks of double-digit gains.
Unfortunately, those gains proved to be unsustainable in the long run, with only about a 10% improvement over the nadir of the stock’s value in April.
Chart courtesy of StockCharts.com
So, where does that leave the Aphria stock forecast? Hard to say, but I would be wary of the stock at the moment.
Over the past month, the stock price is down about five percent. While I believe that gains are in store down the line, the question is whether those gains are sustainable or whether they will simply be flashes in the pan.
In my view, despite APH stock having a number of things going for it, the investment is more of a short-term play.
Its price-to-earnings ratio (P/E) ratio is solid, especially compared to some other heavyweights in the marijuana industry. That should go a long way toward warding off accusations of overvaluation, but that has yet to be the case.
While I believe there is value in the company, my Aphria stock forecast is muted compared to other—in my view, better-situated—stocks like Canopy Growth Corp (NYSE:CGC).
The best play for APH stock is to watch for sustained gains to start to pushing the stock value back up. When that time comes, consider getting in for the long term.
A short-term play may involve a more aggressive strategy of investing in the stock on the way up but being willing to ditch the shares should an immediate correction follow.
Aphria stock is one of the riskiest and most volatile large-cap marijuana stocks available on the market right now. The company has had a wild go of it in 2018 so far, and that shows no sign of letting up.
While there’s definitely money to be made from APH stock, it’s—as always—a question of timing.
The company’s nadir in April and early May hopefully won’t be surpassed this year (and I doubt it will fall below them), but that doesn’t mean big gains are in store.
There’s a lot of potential wrapped up in APH, and a well-timed purchase could result in big earnings.