Aurora Cannabis Inc. (OTCMKTS: ACBFF) Turns To Acquisitions And Partnerships To Accelerate Growth
Aurora Cannabis Inc. (OTCMKTS: ACBFF) has not had the best of starts to a new year. Its stock has been under immense selling pressure, a move that has seen its tank from the $12.30 handle to current trading levels. However, the steep pullback cannot in any way be attributed to deteriorating underperformance.
The industry has been under pressure for the better part of the year. However, things are starting to look up, presenting a unique opportunity to buy stocks with high growth potential.
Aurora Cannabis should be an exciting pick for investors looking to gain some exposure in the fast emerging marketplace. The stock appears to have found support at the $6 a share handle, from where it is trying to make a comeback as investor confidence in the space starts to tick higher.
Aurora Cannabis is one of the big players in Canada’s legal cannabis business. The company produces and distributes medical marijuana products in Canada. Its products line consists of dried cannabis and cannabis oil.
Aurora Acquisition Drive
After starting with one flagship project in the name of Aurora Sky, Aurora Cannabis has sought to expand its empire in pursuit of growth opportunities in the sector. Acquisitions and partnerships have come into play, further strengthening the company’s competitive edge in the industry.
Early this year, the company formed a joint venture with Danish tomato and pepper producer Alfred Pedersen & Son for the sale of Cannabis. Pursuant to the agreement, Aurora Nordic facility should come to life, capable of producing 120,000 kilograms a year. The joint venture paves the way for the company to target customers in Europe, in countries that have legalized medicinal cannabis.
Aurora Cannabis has also broadened its product portfolio with the acquisition of Saskatchewan-based CanniMed. The acquisition adds about 19,000 kilograms of fully-funded capacity into Aurora Coffers.
The company is also pursuing sales opportunities in addition to strengthening its production capacity. The signing of a final agreement with Société des Alcools du Québec should low the company to supply a minimum of 5,000 kg of cannabis per annum to Quebec adult consumer market, once it comes online.
“With two facilities, as well as a supply agreement with the Green Organic Dutchman, we have a strong local presence, which we believe will contribute to increased visibility in this important market. We look forward to establishing the Aurora Standard as the benchmark for quality and customer service in Canada’s second most populous province,” stated Terry Booth, CEO.
Acquisitions and partnerships all but position Aurora Cannabis in a strategic position, in pursuit of revenue opportunities in the fast-growing cannabis industry. The stock is thus expected to continue climbing as investors take note of the emerging opportunities for growth.
iAnthus Capital Holdings Inc. (OTCMKTS: ITHUF) An Emerging Cannabis Play After 615% Revenue Growth
iAnthus Capital Holdings Inc. (OTCMKTS: ITHUF) stock look set to climb higher after the company reported impressive fourth quarter financial results. A 615% increase in revenue in the quarter underscores the rate at which the company is growing.
After falling from highs of $5.08 to the $2.3 handle, the stock has bounced back in what appears to be a continuation of the long-term uptrend. The stock needs to rise and close above the $3.80 handle, to reaffirm confidence about the continuation of the uptrend. On the downside, the stock faces immediate support at the $3 handle, below which it could drop to the $2.40 mark.
IAnthus Capital owns and operates best in class licensed cannabis cultivation, and dispensary facilities in the U.S. The company also seeks to provide investors with exposure to the U.S regulated cannabis industry.
Stellar fourth quarter financial results is the latest catalyst sending shares of iAnthus Capital up the chart. The company generated revenues of $2.4 million in the quarter, representing a 615% increase. Net loss in the quarter came in at (-$13.7 million. IAnthus Capital attributes the growth to a rise in costs because of expansion into additional states.
Invested capital in the quarter totaled $23.7 million bringing the total capital invested to date at $98.7 million. During the quarter, the company closed a C$12 million short-form prospectus offering.
“The past year has brought major developments for iAnthus, including acquisitions in the major east coast markets of Florida and New York , the continued build-out of a world-class operations team led by Carlos Perea (Chief Operating Officer), and the establishment of iAnthus as one of the U.S. cannabis industry’s most well-known and well-funded companies,” said CEO, Hadley Ford.
Pilgrim Rock Acquisition
Separately, iAnthus Capital has completed the acquisition of the remaining 20% stake in Pilgrim Rock. The acquisition will provide the company with access to Mayflower an affiliate of Pilgrim Rock that has received provisional licenses to registered marijuana dispensaries in Massachusetts.
According to Randy Maslow, president of iAnthus, focus now shifts towards positioning Mayflower as a leading cultivator, processor, and operator of dispensary operator in Massachusetts. The subsidiary has a 36,000 cultivation facility in Holliston that is fully operational.
In addition, iAnthus wholly owned subsidiary, Grow Healthy Holdings has commenced delivery of cannabis products to patients in Florida. The company has also signed a lease for a dispensary in Orlando Florida.
Is General Cannabis Corp (OTCMKTS: CANN) A Bounce Back Play On Positive 2018 Outlook?
Shares of General Cannabis Corp (OTCMKTS: CANN) are showing signs of trading higher as investors react to impressive full year financial results and a positive outlook for 2018. According to the Chief Executive Officer, Michael Feinsod, the company has never been in a better position to take advantage of its strong infrastructure, in a bid to focus on growth.
Over the past one month, the stock has rallied by more than 60% after coming under pressure early in the year. Given that it is currently trading at the $4.34 handle, the stock needs to rise and close above the $6 a share level, for it to attract investors who until now have been on the fence.
A rise followed by a close above the $6 a share level should open the door for the stock to spike to the $10 a share mark. On the downside, the stock faces immediate support at the $4 a share mark below which it remains susceptible to declines to the $2 a share mark.
General Cannabis casts itself as a comprehensive national resource for high quality service providers in the legal cannabis space. The company is also engaged in the business of cultivating producing and sale of cannabis products.
Why is the Stock Spiking?
The stock has bottomed out after coming under pressure early in the year after the management stated 2017 was a transformative year. According to the Chief executive officer, the balance sheet is stronger than ever, on the company generating impressive revenues last year.
General Cannabis has already paid down a substantial amount of its debt and raised new equity, expected to finance development plans in 2018. The company exited 2017 with a net loss of (-$8.2) million an improvement from ante loss of (-$10.2) million reported in 2016
“Our business expanded during the year, which positions us for continued national expansion. We will continue to hire talented executives to support our growth. General Cannabis has never been in a better position to take advantage of our strong infrastructure and continue to focus on growth through acquisitions,” said Michael Feinsod Executive Chairman of the board.
The management expects Security Segment revenues to increase as expansion in California gains traction. The company is also planning to explore additional service offerings. Marketing segment should also post significant growth as General Cannabis pursues national distributors and retailers for its apparel lines.
General Cannabis is also planning it carry out acquisitions in 2018 in a bid to accelerate growth.