Aurora Cannabis Inc (OTCMKTS:ACBFF) is without a doubt one of the biggest players in the booming cannabis patch. Aggressive deployment of cash on the launch of new products, strategic acquisitions as well as strategic investments have allowed the firm to accrue a substantial amount of market share.
Aurora Cannabis Price Action
However, its stock has failed to live up to expectations in recent months after coming under pressure early in the year. While the stock has bounced back to its year opening levels, it is still off, its all-time highs of $12.30 a share. The big question now is whether the stock has what it takes to bounce back and register a new all-time high.
If recent developments are anything to go by, then it would be in order to say that Aurora Cannabis could soon retake its 52-week high. The sell-off that came into being, early in the year, appears to have been a minor correction from which the stock is slowly bouncing back.
With the stock currently trading at the $7.56 handle, it needs to rise and stabilize above the $9 a share mark to affirm the emerging uptrend. Above the critical resistance level, the stock would be on its way to its 52-week high. On the downside, the stock faces immediate support at the $6 a share handle, below which it could drop to the $5 a share level, seen as the next critical support level.
Aurora Cannabis bear run in recent months cannot in any way be attributed to deteriorating performance. The company has made important strides through strategic investments that in our view affirm and assert, its ability to be a key producer and distributor of medical marijuana products not only in Canada but also in other emerging markets.
Aurora Cannabis Investment Spree
Aurora Cannabis has been aggressive in the deployment of cash as it looks to affirm its edge and shrug of competition. The acquisition of CanniMed and MedReleaf Corp all but underlines how focused the company is as it seeks to accelerate growth through acquisitions. The company has also taken a majority stake in Green Organic Dutchman as part of its acquisition spree.
The C$3.2 Billion transaction between Aurora Cannabis and MedReleaf Corp brings together two of Canada’s premier companies with strategic visions and productions philosophies as well as complementary assets and distribution network. The merger will result in a company with a capacity of over 570,000 high-quality cannabis.
“Our complementary assets, strategic synergies, and strong market positioning will provide us with critical mass and an excellent product portfolio in preparation for the adult consumer use market in Canada. Equally, the combination strengthens our capacity to service the rapidly expanding global medical cannabis markets, and amplifies our early-mover advantage,” said CEO Terry Booth.
Aurora Cannabis has also acquired a 9.14% stake in CTT Pharmaceutical as part of its strategic investment drive. With the acquisition, the company has gained global exclusive rights to develop manufacture and market CTTs novel oral thin wafers that are used for smoke-free delivery of medical cannabis or other active ingredients.
Europe expansion Drive
Aurora Cannabis has set its eyes on the European market making it clear it means business when it comes to pursuing sales opportunities. The company through its wholly owned subsidiary Pedanios GmbH has inked a collaboration agreement with Heinrich Klenk GmbH & Co.
The collaboration paves the way for the Canadian Cannabis company to gain access to a distribution Channel of over 25,000 Pharmacies through Europe. Pedanios already has more than 1,500 pharmacies as distribution points under its belt.
The deal provides the company with the much need firepower to compete for market share, in the wake of Cronos Group announcing a deal with G. Pohl-Boskamp.
New Product Line
In addition to making strategic investments and expanding footprint into new markets, Aurora Cannabis has also reiterated its ambition to strengthen its product line. Aurora Frost is the new product line that the company has launched, as it looks to pursue more market share in the dried cannabis space.
The new product represents the company’s highest potency offering with over 35% THC. The company says it developed a new proprietary technology, to efficiently produce such a high volume and GMP compliant Aurora Frost. The product is to ship inconvenient child safe and certified glass bottled priced at $35 a gram.
“Aurora now makes this high potency medical cannabis available to its patients, reflecting the Aurora Standard of innovation and patient care,” said Mr. Booth.
What Next For Aurora Cannabis.
Strategic Acquisitions, investments and the launch of a new product line all but affirms Aurora Cannabis credentials as one of the key players in the cannabis industry. The company has essentially positioned itself to be one of the biggest beneficiaries as the marketplace expands and demand for various cannabis products grows.
That said, the company has every reason to succeed given how aggressive it is, in pursuing opportunities for growth and sales. The recent pullback in stock price in our view presents a unique buying opportunity for investors who missed out on the initial Bull Run as the stock is destined to trade higher.
We will be updating our subscribers as soon as we know more. For the latest updates on ACBFF, sign up below!
Disclosure: We have no position in ACBFF and have not been compensated for this article.