- Market vastly underestimating long-term potential of Aurora Cannabis.
- Market yawns at huge deal for Farmacias Magistrales S.A., as it did with ICC Labs – the market is wrong.
- “Not for sale” – will command much higher price in any future partnership or outside investment.
Aurora Cannabis (ACB) continues to be the major cannabis company that gets the least respect, and there are several reasons for that being the case; all of which provide a terrific opportunity to get the company at a bargain price before it takes off again.
Among the major reasons for it being underappreciated are the broader market correction, many investors misunderstanding or overemphasizing the recreational market in Canada, the wrongheaded idea that Aurora can’t attract a larger partner, and not pricing in the tremendous deals the company has been making in relationship to production capacity, medical cannabis and international expansion.
All of this things will result in it outperforming its peers in the years ahead, with the obvious caveat its competitors could make some deals that alter that thesis. But as things stand today, and are likely to remain in place for several years, Aurora Cannabis will without a doubt be the strongest performer in the production side of the cannabis sector.
Broader market correction
The first thing to look at concerning the value attributed to Aurora is the broader market sell-off. For Aurora, it couldn’t have been worse timing, as it had an enormous amount of positive momentum going for it, and at the time it was being listed on the NYSE, which under almost any circumstance would have been a significant catalyst, the market collapsed, releasing the air out of that balloon.