Aphria Inc (TSE:APH)(OTCMKTS:APHQF) Remains A Top Cannabis Pick

Aphria Inc (TSE:APH)(OTCMKTS:APHQF) has been and continues to be a top cannabis pick here at Insider Financial. We've categorized the stock as a must-own for cannabis investors looking for exposure to probably the hottest market sector right now. As we head into spring time, there's no shortage of catalysts over the next coming months to propel Aphria Inc higher and turn the stock into a top winner for 2017. As we take a closer look, a breakout to new highs looks to be just around the corner.First up, a little background on the company for those looking at a new exposure. Aphria Inc is one of Canada's lowest cost producers that produces, supplies and sells medical cannabis. Located in Leamington, Ontario, the greenhouse capital of Canada, Aphria is truly powered by sunlight, allowing for the most natural growing conditions available. The company is committed to providing pharma-grade medical cannabis, superior patient care while balancing patient economics and returns to shareholders. Aphria Inc was the first public licensed producer to report positive cash flow from operations and the first to report positive earnings in consecutive quarters.The biggest catalyst for Aphria Inc and one which changes the dynamics of the entire cannabis landscape is federal recreational marijuana legalization in Canada. Back in December, we saw the Canadian Federal Task Force issues its recommendations on how to legalize recreational marijuana use. The proposals included a minimum purchase age of 18, federal oversight on production, provincial governments charged with retail distribution and maintaining criminal offenses for illicit production and trafficking. The Task Force was lead by Canada’s former attorney general and offered more than 80 recommendations on how Canada could become the largest developed-world country to legalize marijuana.The legislation is set to go into effect on July 1st and Aphria Inc is prepared to meet the expected increase in demand. Aphria is currently in the middle of a part IV expansion. The C$137 million project will increase Aphria’s capacity under the Access to Cannabis for Medical Purposes Regulations (ACMPR) from 300,000 square feet to 1,000,000 square feet. In addition to the 1,000,000 greenhouse growing square feet, the Company’s infrastructure will grow to over 250,000 square feet, necessary to service the expected 70,000 kilograms of eventual annualized harvests.

The project includes 700,000 square feet of Leamington standard, Dutch style greenhouses, 230,000 square feet of infrastructure, including new Level 9 vaults, automation for all of the greenhouses, processing areas, warehouse facilities, a 15 MW power and heat co-generation facility and security consistent with ACMPR standards. Aphria anticipates completion of Part IV within 12 months, Health Canada approvals within 4 months of completing the expansion, and first harvest within 4 months after Health Canada approval.

Last month, Aphria became the second cannabis company after Canopy Growth Corp (TSE:WEED)(OTCMKTS:TWMJF) to join the Toronto Stock Exchange (TSX). CEO Vic Neufeld said of this momentous event:

"Aphria's listing on the TSX represents a major milestone in our strategic growth plan, helping to increase trading liquidity, access a growing investor base interested in the cannabis industry, and raise capital for further investments. As one of Canada's leading cannabis companies, we are excited about the opportunities in this rapidly growing market to drive shareholder value and continue Aphria's success story. The TSX is the premier listings destination and this achievement highlights the strength of our experienced management and team, our commitment to providing safe, quality products and our positive growth trajectory."

The latest news out of Aphria is that the company made an additional investment of US$3 million in Copperstate Farms Investors, LLC. The investment will assist Copperstate Farms Investors in advancing its capital expenditure program related to extractions, lighting and power generation. This investment increases Aphria's membership units in Copperstate Farms Investors from 10% to 18.5% of those issued. Copperstate Farms Investors owns a 95% interest in Copperstate Farms LLC, a licensed producer of medical cannabis in the State of Arizona. The remaining 5% interest in Copperstate is owned by Aphria, through its subsidiary Aphria (Arizona) Inc. Copperstate owns approximately 1.7 million square feet of greenhouses in Snowflake, Arizona and plans to bring approximately 348,000 square feet, into medical cannabis production in the fall of this year.

Currently trading with a market cap of C$791 million, Aphria Inc is well-funded after closing its most recent financing. The company sold 11,500,000 common shares at a price of C$5.00 per Share, for aggregate gross proceeds of C$57,500,000. Besides its part IV expansion and investment in Copperstate, Aphria has also invested in Cannabo Medical (OTCMKTS:CAMDF), CannaRoyalty (OTCMKTS:CNNRF), Green Acre Capital, Kalytera Therapeutics, MassRoots (OTCMKTS:MSRT), Resolve Digital Health, Scythian BioSciences, and Tetra Bio-Pharma (OTCMKTS:GRPOF). This diversification makes Aphria Inc a top pick for cannabis investors.

We will be updating our subscribers as soon as we know more. For the latest updates on APH/APHQF, sign up below!

Disclosure: We have no position in APH/APHQF and have not been compensated for this article.