Marijuana News Today
In the marijuana news today, we have two very strong showings from pot stocks that have gobbled up many headlines of late: Tilray Inc (NASDAQ:TLRY) and Aurora Cannabis Inc (OTCMKTS:ACBFF, TSE:ACB).
Tilray stock is in the marijuana news today for its massive swings both up and down, while Aurora Cannabis stock has been registering win after win lately.
We’ll cover Tilray stock further below in this piece, but first let’s get to the breaking news, Aurora Cannabis stock’s fiscal report.
The company posted a surprisingly positive Q4 with a profit compared to last year’s loss. (Source: “Aurora Cannabis Inc. Announces Results for the Fourth Quarter and 2018 Fiscal Year,” Cision, September 24, 2018.)
Revenue shot up 223% compared to last year, hitting $19.1 million.
The gross margin on medical cannabis also jumped quite high, hitting 74% versus 28% during the same period last year. The increase came about due to a higher average selling price per gram of dried cannabis alongside a higher proportion of cannabis oil sales.
Coupled with the higher profit margins was a decrease in cash cost of sales and cash cost to produce, dropping by 11% compared to last year.
These metrics are especially important as they are some of the key factors that differentiate the myriad marijuana stocks. While many pot companies have signed supply agreements and the like, being able to keep production costs down and drive up profit margins on sales is going to be vital to a healthy and prolonged success.
Aurora Cannabis stock was also the beneficiary of increasing its active registered patients by 164% compared to last year.
The company’s kilograms produced and sold also jumped 90% and 114%, respectively.
Overall, this was a fantastic Q4 showing from Aurora Cannabis stock. As such, we’re seeing the company’s value jump by about 10% in early-morning trading.
Aurora Cannabis Stock Forecast
Aurora Cannabis stock has not had the best 2018, registering losses for much of the year. While the company now finds itself up by about 35% year-to-date, that pales in comparison to the massive jumps made by some of its rivals, like Canopy Growth Corp (NYSE:CGC), which has seen a climb of over 130%.
But that all seems like it’s about to change.
The company has had success after success of late, culminating in this very strong Q4 report.
The first major breakthrough was the report that The Coca-Cola Co (NYSE:KO) was in talks with Aurora to produce non-alcoholic, cannabis-infused beverages. (Source: “Coke, Aurora Cannabis in talks to make marijuana-infused drinks: BNN Bloomberg,” CNBC, September 17, 2018.)
As a result, Aurora Cannabis stock climbed swiftly, surging 10% when the reports came in, while KO stock hasn’t seen much movement since the talks were announced.
This is naturally one of the biggest developments in the industry since the Constellation Brands, Inc. (NYSE:STZ) $3.8-billion investment in August.
If Coca-Cola comes in hard and fast with a huge injection of capital, expect marijuana stocks across the board to go nuts with gains, especially ACBFF stock.
Then, in keeping with its string of aggressive acquisitions this year, Aurora acquired Agropro UAB, Europe’s largest producer, processor, and supplier of organic hemp and hemp products.
The Agropro acquisition provides Aurora with access to 1,600 hectares of land to grow a potential 1,000,000 kilograms of hemp, while Agropro is also looking into expanding into Lithuania, Latvia, Estonia, and Poland, potentially adding another 3,000 hectares. (Source: “Aurora Cannabis Acquires Europe’s Largest Organic Hemp Company,” Cision, September 12, 2018.)
The deal will open up Agropro to exploiting the cannabidiol (CBD) components of its hemp.
Aurora is planning to use that formerly discarded hemp biomass containing CBD to create a number of wellness products.
All this serves to make Aurora Cannabis stock one of the hottest ones on the market right now both in the short and long term.
While ACBFF stock may be one of the hottest stocks around right now, nothing beats the star-level heat coming off of TLRY stock.
The marijuana company famous for its volatility proves once more why it is the best short-term play in the industry, full stop.
After taking a beating yesterday, Tilray stock is up again in early-morning trading by nearly 18%.
The stock refuses to behave in any predictable way, falling and rising by double digits on a whim.
With this much volatility surrounding Tilray stock, making any sort of confident forecast is difficult. In fact, the best bet on TLRY stock is that it certainly will not be a boring play.
With that all said, I believe the best way to play TLRY stock is for short-term buying and selling, or shorts, if that is your preferred investment strategy.
Both are high-risk/high-reward (especially compared to ACBFF stock and CGC stock) but offer the best chances to see massive gains in a short period of time.
TLRY & CGC Stock Performances
On the chart below are the recent performances of ACBFF stock (black line) and TLRY stock (blue line).
Chart courtesy of StockCharts.com
Aurora Cannabis stock continues to impress with its latest string of acquisitions and deals, making it one of my favorite marijuana stocks to close out 2018, while Tilray stock continues to be one of the most volatile plays in the market.