Why Aurora Cannabis Inc (NYSE: ACB) stock is rising

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Aurora Cannabis Inc (NYSE: ACB) stock rose over 3.3% on 15th May, 2019 (as of 12:58 pm GMT-4; Source: Google finance). The Production volume rose by 99% to 15,590 kgs, up 1,200% year-over-year. The increase in production accelerated through the quarter, and the majority of the harvested volume was realized in the last half of the quarter. Further, the Adjusted EBITDA loss improved by 20% to $36.6 million as the company continues to track towards achieving EBITDA positive results beginning in the fourth quarter 2019 as operations continue to ramp up.

Aurora Cannabis Inc. (CNW Group/Aurora Cannabis Inc.)

Meanwhile, in January 2019, ACB has completed a US$345 million Convertible Notes offering, and the proceeds will be used to continue the company’s pace of growth in Canada and internationally.

ACB in the third quarter of FY 19 has reported the adjusted loss per share of 16 cents, missing the analysts’ estimates for the adjusted loss per share of 5 cents, according to the analysts polled by FactSet. The company had reported the adjusted revenue growth of 35.9 percent to C$65.2 million in the third quarter of FY 19, missing the analysts’ estimates for revenue of C$67.6 billion. The average selling price per gram also declined slightly due to product mix effects (higher contribution from wholesale consumer), extraction capacity constraints that resulted in extract-based products comprising 18% of net cannabis sales, and the first full quarter impact of excise tax on medical cannabis.

For the fiscal fourth quarter, analysts on average model adjusted losses of 3 cents a share and net revenue of C$119.4 million. ACB reiterates its target for the fourth quarter with production available for sale in excess of 25,000 kg. The company plans to allocate a portion of this capacity to its inventory for manufacturing new products. The Aurora Sky and Bradford facilities are now operating at full capacity. As the production ramping up, ACB will continue to increase the manufacturing capacity, with innovation and technologies aimed at reducing time from harvest to market.

Additionally, On March 1, 2019, ACB has acquired Whistler, an iconic Canadian organic cannabis brand which commands a significant premium for its products in both the Canadian medical and consumer markets. The Company has also signed the binding letter agreement with Hempco to acquire all of the issued and outstanding shares of Hempco.

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