Marijuana Stocks, Safer After Latest Analyst Ratings?

It doesn’t take more than a minute to see that marijuana stocks have had a tough go of it in 2019. Some of the top pot stocks have tumbled to or near new 52-week lows, and the latest slew of ratings paint an interesting picture for some of these big names in cannabis. Just this week Stifel analysts cut their rating from Hold to Sell and dropped the price target from C$7 to C$5 for Aurora Cannabis (ACB). After reporting quarterly results, The Street now sees that the industry may be in need of streamlining.

Though Aurora reporting considerable revenue growth of 52% over the previous quarter, losses mounted. The company reported that it had lost C$12 million before interest, taxes, depreciation, and amortization. This was more than double what most analysts were expecting. Stifel analyst Andrew Carter stated, “We believe these recent results and the negative implications for the outlook suggest real difficulty for Aurora to execute at a level to maintain its current premium valuation.”

But this may not be as black and white as some analysts are suggesting. According to Chief Financial Officer Glen Ibbott, Aurora’s losses can be attributed, in part, to the scarcity of retail stores in certain provinces. “We are still at the mercy of the timing of the retail rollout,” he said. “We’re excited that Ontario is licensing new stores…but there should be hundreds.”

Light At The End Of The Tunnel For Marijuana Stocks?

Despite this, the long-term argument supporting marijuana stocks may still be intact.  Many …

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