I can't reply to private messages. I only have the basic membership Sorry.
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"we don't know if any additional appeals will be filed and what the chance those appeals, if any, might be denied"
Precisely. The outcome of the appeal that was filed is a foregone conclusion. It's the appeal(s) not filed yet that are the unknown factor. If any more surface they will likely be from an organized group, be written by a lawyer and filed right before the deadline. No matter how many times it's stated that the current appeal will be thrown out, it does nothing to alleviate concerns that another appeal will clog up the timeline.
I haven't really posted on this board, but initially got in @ $0.26 and holding.
Cam Battley tweets that construction of Aurora Sky will be complete in "a few weeks"
Official opening in September when the landscaping is complete. See the question about completion and his response immediately below the pic
What’s cooler on #CanadaDay than visiting #AuroraSky? Multiple strains. First harvest last week. Everything looking excellent. The robots have excellent manners, said hello, and waved Canadian flags. This last bit is sort of a lie. pic.twitter.com/1cqET95xmN
— Cam Battley (@CamBattley) July 1, 2018
What is the difference between an accretive and a dilutive merger (or aquisition)?
This is what should be discussed regarding MedRelief.
Here's a basic primer:
https://www.investopedia.com/ask/answers/043015/what-difference-between-accretive-and-dilutive-merger.asp
I would think the LCBO will carry Aurora. I would think they would carry product from at least all the top 5 producers. Not carrying them would be like not carrying Canadian Club or Molson Canadian.
Excerpt from "Quick Facts" about Bill C-45
The follow excerpt is taken from a document that was published online yesterday, before Royal Assent was granted. For those who are interested, here is the link to the entire document:
https://www.canada.ca/en/health-canada/news/2018/06/bill-c-45-the-cannabis-act-passed-in-senate.html
Of note is the following point:
Once the legislation receives Royal Assent, provinces and territories will be able to purchase cannabis from federally licensed producers, so that distributors and retailers can begin preparing retail access online or in physical stores; however, they will not be able to sell cannabis products to adults of legal age until the Cannabis Act comes into force.
This is an important point. Purchases made by distributors and retailers in advance of October 17th will be reflected in quarterly reporting. While there is little time left for Q2 purchases, Q3 should reflect significant sales made in advance of initial sales. While no one wants to pay carrying costs over a long period of time, Provincial distribution boards and retail vendors will likely not wait until the final couple weeks to obtain their entire inventories.
Cost to borrow shares (Questrade)
I thought I would list today's (June 21st) cost to borrow shares (interest rate) provided by Questrade for Aurora and a few other Canadian-listed pot stocks for comparison (for any Americans, Questrade is a low-cost Canadian brokerage). Needless to say, the interest rate reflects the demand for shares to short, as influenced by the supply of shares available to borrow.
ACB.TO 54.59%
by comparison
OGI.VN 66.13%
TGOD.TO 45.96%
APH.TO 31.84%
WEED.TO 19.44%
VFF.TO 9.43%
SNN.CN 4.5%
My first reaction to some of the interest rates is extreme caution. Any firm or individual willing to short at some of those rates would have to be pretty damned confident of not just a pullback, but in some cases, an all but outright collapse. Of course, these are Questrade's rates for June 21th. Other brokers may be lending for considerably less. Also keep in mind that they will fluctuate considerably and may have been driven higher than normal in anticipation of a "sell the news" day.
It could also be that the borrow rates are so high because these are Canadian stocks with a large retail ownership, which could be held in either TFSA or RRSP accounts, making them ineligible for lending). By contrast, most Margin account agreements automatically give the brokerage the right to lend out shares, especially if the margin is being used (and no, putting shares up for sale at a ridiculously high price does not prevent the brokerage from lending them out - even if they sold, the brokerage would still have 2 days to call in any loans before the trade clears).
It may also be that until now, few institutional holders are holding shares due to internal rules governing their investments. Some major institutional firms are notorious for lending shares (Blackrock and Susquehanna immediately come to mind) and are typically the major source of lendable shares. If that is the case, the playing field may change abruptly now that the law has been passed and received Royal Assent.
If the bill is adopted by the House as amended by the Senate, the bill goes on for royal assent and becomes law. If the House rejects or modifies any of the amendments, the bill gets sent back to the Senate for another vote.
https://www.ourcommons.ca/About/Compendium/LegislativeProcess/c_d_houseconsiderationsenateamendmentsbills-e.htm
The news story being circulated by the Canadian Press is not 100% correct.
The Senate schedule shows that individual committees sit in the morning. The sitting of the Senate as a whole begins at 1:30 PM Eastern Time. The vote will take place at some point after that. It's very possible the actual vote will not happen until after the close.
https://sencanada.ca/en/calendar
I personally don't put a lot of emphasis on the PINX reporting of a Canadian listed stock that trades primarily on the TSE, but I guess we each got to decipher for ourselves what's important in the way of DD.
BTW the latest US numbers for short interest for the end of May aren't even out yet. They will be published after the close on the 11th.
http://www.finra.org/industry/short-interest/short-interest-reporting-due-dates
Latest Short Interest numbers
Short Positions for ACB
Symbol T : ACB
Report Date 2018-05-31
Volume 29,279,126
Change 9,305,269
Shares Issued 561,332,678
% Float 5.22
source: https://www.stockwatch.com/Analytics/Shorts.aspx?action=go&symbol=ACB®ion=C
You need an account to view the short interest numbers. You can open a free 30 day trial (that's what I did, using a dead email address that they can spam all they want lol).
Tomorrow's Senate Vote
Tomorrow is the scheduled vote on Bill C-45
Various Senate Committees meet in the morning. The Senate as a whole is currently scheduled to convene @ 1:30 PM Eastern time.
Here's the link to the Senate Calendar
https://sencanada.ca/en/calendar/
This link provides the business agenda for the current day
http://www.parl.ca/LegisInfo/Agenda.aspx?Language=E&Mode=1
For anyone who wants to listen to the live stream tomorrow ...
http://senparlvu.parl.gc.ca/XRender/en/
You can find the short interest numbers (which some confuse with the daily short volume) here. You can open a guest account that's good for 30 days. Once you open the guest account, enter the stock ticker you're interested in, search it, then select the short tab. It will give you the short interest numbers, as well as the historical data.
https://www.stockwatch.com/default.aspx
The latest short interest numbers were for May 15th.
Report Date 2018-05-15
Volume 19,973,857
Change 7,635,799
Shares Issued 561,006,914
% Float 3.56
(needless to say the percentage of the float reported is not exactly the level that would be considered as a huge short squeeze potential)
Just be aware of what you're looking at. That data is from the bi-monthly FINRA numbers. Those numbers were last released for the April 30th settlement date. It's informative, but it is dated data and it does not indicate what's happened since April 30th.
The May 15th numbers will be released on May 24th. If you pay for early access, you can see it prior to it being publicly published.
http://www.finra.org/industry/short-interest/short-interest-reporting-due-dates
Enter the ticker you're interested in and FINRA will show you the latest data. http://otce.finra.org/ESI
The WSJ publishes short interest for the major US exchanges. It can be found here.
http://www.wsj.com/mdc/public/page/2_3062-shtnyse_A-listing.html
Daily short volume is not the same as short interest. Before anyone who does not understand the difference attempts to invest in Aurora based on daily short volume numbers, a little education might be helpful.
Here's an excellent post that's a bit of a primer on the subject that was made on another Investor's Hub board from a number of years ago. It helps explain what creates the bulk of short volume on a typical day.
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=57101068
Translation:
1. The MM gets an order to sell 100 shares
2. The MM sells the 100 shares before he purchases them from the seller. This is a short sale and the first leg of the transaction. The volume is reported as a short sale.
3. The MM then purchases the 100 shares from the seller. This is the second leg of the transaction and is a long sale. Because the volume was already reported in the first leg, the volume is not reported in the second. Why? Because it's two parts that make up a single trade in this situation.
In effect, the 2nd leg cancels out the short in the first leg, but only the first leg gets reported. Those who don't understand look at the daily short numbers and think that the short interest is climbing, however, the daily short volume is typically not at all indicative of what is occurring with the short interest. Yes there are exceptions, however, understanding what is typically occurring will save individuals from acting on false assumptions.
Remember that deal Aurora completed with Shoppers Drug Mart?
Shoppers Drug Mart is owned by Loblaw.
Loblaw is active in applying for retail licenses in Newfoundland, as seen in this list of applicants: Out of 24 applicants to date, Loblaw is responsible for 10 of them. So wherever Loblaw opens a cannabis retail outlet under the Shoppers Drug Mart banner, Aurora product will be sold.
List of Applicants: http://shopcannabisnl.com/request-for-proposals
Here's a news story from the Globe and Mail that discusses the Loblaw applications:
Loblaw eyes recreational marijuana market in Newfoundland and Labrador
The Canadian Press
Published May 7, 2018 Updated 10 minutes ago
Loblaw Companies Ltd. is looking to sell recreational marijuana in Newfoundland and Labrador, as the provincial body handling pot sales has included the company on its list of potential licensed cannabis retailers.
Cannabis NL, a division of the Newfoundland Labrador Liquor Corp., on Monday released its list of qualified retailer applicants which have been selected for the next phase of the application process.
Loblaw’s applications for 10 potential locations were among the 24 selected by Cannabis NL. Other applicants on the list included licensed medical marijuana producer Canopy Growth, regional health store chain the Healthy Vibe, and Tobin’s Convenience.
Lobaw’s presence in Newfoundland and Labrador includes grocery stores under the Dominion banner and Shoppers Drug Mart locations.
Company spokeswoman Catherine Thomas said the retailer does not plan to sell recreational cannabis on its grocery store shelves in the province.
“It would be available behind the counter, in small, existing tobacco shops, adjacent but separate to our Dominion grocery stores,” Thomas wrote in an emailed statement.
Cannabis NL said the Newfoundland Labrador Liquor Corp. will be in touch with applicants in the coming days to determine the next steps in the process.
Loblaw first applied for a license to dispense medical marijuana in 2016. Shoppers Drug Mart has lined up supply deals with several licensed medical marijuana producers including Aurora Cannabis and Aphria, which are subject to Health Canada’s approval of its application.
Loblaw has said medical marijuana is their focus, but their CEO has also said that the retailer is open to being involved with recreational marijuana.
Thomas said Monday that while Loblaw has been named among the qualified applicants to sell recreational pot, “there are more steps to come and it’s premature to discuss details or outcomes.”
source: https://www.theglobeandmail.com/business/article-loblaw-eyes-recreational-marijuana-market-in-newfoundland-and-labrador/
CBC offers some interesting commentary ...
Growth strategy
While he has no personal knowledge of any deal in the works, Chris Damas, editor of investment newsletter The BCMI Cannabis Report, said in an interview Thursday that any tie up between the two companies would be very much in keeping with Aurora's strategy of growing by acquisition.
"I think Aurora has this complex that they have to be bigger than Canopy," Damas said, referring to Canopy Growth, the biggest pot company in Canada. "And the only guy that can get them bigger than Canopy is MedReleaf."
MedReleaf may be an easier takeover than previous targets, Damas adds, because only six people control more than 50 per cent of the company's 110 million shares.
"The people at MedReleaf see the writing on the wall, the six big shareholders, they say 'Look, I'd like to get out'," Damas says.
"If they can get a lockup, this deal can be done," he said. "It's not a slam dunk [but] that's what my guess is."
Personally I find those comments rather interesting. In part, because if this actually is a shareholder push by only 6 investors who collectively represent over 50% of outstanding shares, looking to cash in and get out, the terms could end up being quite different than the CanniMed deal.
Based on the information from all sources to date, Aurora didn't approach MedReleaf, MedReleaf approached Aurora along with all the other big players, shopping for a deal. This is a complete reversal from the CMED situation. Aurora is in the drivers seat. Rumours that the controlling interest is looking to exit won't drive up share value. If anything, it'll accomplish the opposite, especially if any discussions are prolonged. Looking beyond the minute-by-minute initial reaction in share prices, let's see what develops over the coming days. As opposed to an initial offer that turned hostile, this could very well develop into an initial deal shopping initiative by MedReleaf that turns very sour for their shareholders.
Actually, neither MedReleaf nor Aurora denied anything. Both companies stated they would not comment on any discussions that may be taking place, unless an agreement is actually reached.
From the MedReleaf PR:
As a general policy, MedReleaf does not publicly comment on unusual market activity, rumors or speculation in the marketplace or any potential transaction unless, and until, a binding legal agreement to effect that transaction has been signed.
From the Aurora PR:
The Company's policy is not to comment on speculative media reports. The Company does confirm that it engages in discussions with industry participants from time to time, including MedReleaf. At this time the Company confirms there is no agreement, understanding or arrangement with respect to any transaction with MedReleaf.
In accordance with applicable disclosure requirements, Aurora will advise the market of material changes when they occur.
What would a merger with, or aquisition of MedReleaf bring to Aurora?
(note: all comments in italics are snippets from recent MedReleaf Press Releases)
1. A strong presence in Ontario, with MedRelefeaf's recent purchase of a 1M sq ft greenhouse facility, as well as the current ongoing expansion of the Brandtford facility. That purchase includes adjacent land that would allow a future doubling of the current greenhouse space.
MARKHAM, ON, April 12, 2018 /CNW/ - MedReleaf Corp. (TSX:LEAF) ("MedReleaf" or the "Company"), Canada's first and only ISO 9001 and ICH-GMP certified cannabis producer, today announced that it has closed its previously announced agreement to acquire 1 million square feet of existing greenhouse infrastructure on a 69 acre property in Exeter, Ontario ("Exeter Facility") and 95 acres of adjacent land. The total purchase price for the transaction is approximately $26 million, consisting of $21.5 million in cash and 225,083 common shares of MedReleaf.
2. A match with Aurora Larssen Projects to complete the conversion of the recent greenhouse purchase.
Work to retrofit the Exeter Facility for cannabis production will begin in April with first harvest expected in the first quarter of 2019, subject to receipt of a licence from Health Canada. MedReleaf is fully funded to complete the project with cash on hand. The Exeter Facility, after full retrofit, will have annual production capacity of up to 105,000 kilograms, increasing MedReleaf's fully funded annual production capacity to 140,000 kilograms.
3. Guaranteed sales in Quebec, above and beyond the current Aurora agreement
MARKHAM, ON, April 11, 2018 /CNW/ - MedReleaf Corp. (TSX:LEAF) ("MedReleaf" or the "Company"), Canada's first and only ISO 9001 and ICH-GMP certified cannabis producer, today announced that it has completed a supply agreement with Société des alcools du Québec ("SAQ") to supply the future Société québécoise du cannabis (SQDC) with high quality adult recreational-use cannabis products in accordance with the previously announced Letter of Intent ("LOI").
Under the terms of the agreement, MedReleaf is committed to supplying the Quebec market with 8,000 kilograms of cannabis products per year with a minimum three-year term.
4. Expanded presence in Germany and Australia
MARKHAM, ON, March 19, 2018 /CNW/ - MedReleaf Corp. (TSX:LEAF) ("MedReleaf" or the "Company"), Canada's first and only ISO 9001 and ICH-GMP certified cannabis producer, today announced that it has entered into an agreement to become the largest supplier of medical cannabis products to Cannamedical Pharma GMBH ("Cannamedical"), a leading medical cannabis distributor to pharmacies in Germany. MedReleaf will provide Cannamedical with monthly exports of five of its premium strain varieties significantly improving the predictability and security of drug delivery to the German market. Sales to Germany will commence promptly upon the expected receipt of MedReleaf's European Medical Agency Good Manufacturing Practices ("GMP") certification and export permit from Health Canada in the coming weeks.
MARKHAM, ON, Nov. 14, 2017 /CNW/ - MedReleaf Corp. (TSX:LEAF) ("MedReleaf" or the "Company"), Canada's first and only ISO 9001 and ICH-GMP certified producer of medical cannabis, today announced that its Australian joint venture partner, Indica Industries Pty Ltd. (t/a "MedReleaf Australia"), has been granted a licence from the Australian Government Office of Drug Control ("ODC") for the cultivation and production of medical cannabis. The licence to undertake authorized cannabis activities commences on November 10, 2018 in order to allow time to complete infrastructure development of the facility.
5. Expanded Medical product lines
MARKHAM, ON, Feb. 6, 2018 /CNW/ - MedReleaf Corp. (TSX:LEAF) ("MedReleaf" or the "Company"), Canada's first and only ISO 9001 and ICH-GMP certified cannabis producer, today announced that it has received Health Canada approval for the sale of its cannabis oil softgel capsules, becoming the first licensed producer ("LP") to bring colour-coded and cannabis variety-specific softgel capsules to market and the only LP to manufacture softgel capsules from a certified ISO and GMP facility.
"Orally ingested softgel capsules give prescribing physicians and patients precise dosing in a familiar and convenient medicinal form factor. These products provide access to cannabis for an under-served patient community more comfortable taking their medication in a traditional capsule rather than by oil or through vapourizers," said Robert Gora, Senior Director of Physician Outreach. "As part of MedReleaf's ongoing focus on patient safety, our softgel capsules are uniquely colour-coded to allow patients to easily differentiate between the specific cultivar or type of oil product that they are consuming, letting patients more safely manage their medication."
6. Expanded premium brand line-up
MARKHAM, ON, April 3, 2018 /CNW/ - MedReleaf Corp. (TSX:LEAF) Canada's first and only ISO 9001 and ICH-GMP certified cannabis producer, today announced the introduction of AltaVie by MedReleaf, the Company's premium recreational cannabis brand designed for a premium consumer who is curious, discerning about life in general and searching for physical, mental and emotional enrichment.
MARKHAM, ON, March 6, 2018 /CNW/ - MedReleaf Corp. (TSX:LEAF), Canada's first and only ISO 9001 and ICH-GMP certified cannabis producer, today announced it has entered into an exclusive licencing agreement with Woodstock Cannabis Company for use of the iconic Woodstock brand in the Canadian cannabis market.
This is not a complete summary of MedReleaf. For further information, I recommend visiting their Investors page links, which can be found on their main website.
Follow-up: Aurora Cannbis Inc (TSE:ACB), MedReleaf Corp (TSE:LEAF) In Reported Acquisition Talks
https://midasletter.com/2018/05/aurora-cannbis-medreleaf-in-reported-acquisition-talks/
MedReleaf seeking buyer as pot industry consolidates: sources
Most serious discussions are with Aurora Cannabis Inc., sources say - Globe & Mail
This article is behind a paywall so I can't access it. You can see the headline on the right side of the Globe and Mail website.
https://www.theglobeandmail.com/
Both Purolator and Canada Post pick up locally and that is factored into their pricing. No extra charge for trucking, the pricing for Canopy was from their Smith Falls postal code. So too, the pricing for Aurora was from their Edmonton airport postal code. My apologies if that wasn't very clear in my post.
As for selling to Germany or Italy, whether it's one or multiple competitors doesn't matter. Competitors are not standing still and watching. That isn't to say there isn't money to be made, but in the long run, due diligence beats pump posts every time ....
For example:
https://www.newcannabisventures.com/tag/germany/
https://mjbizdaily.com/canadian-mmj-will-available-germanys-20000-pharmacies/
https://news.lift.co/country-country-guide-canadas-cannabis-exports/
https://www.google.ca/amp/business.financialpost.com/commodities/agriculture/aphrias-826-million-deal-highlights-cannabis-producers-global-ambitions/amp
While they are immediately adjacent to any domestic and international cargo services, Aurora will face greater shipping distances to Germany and Italy than a competitor situated reasonably near the Toronto airport.
I guess the final question will be whether cost to ship to an Eastern airport will offset the flight distance advantage for Aurora's competition.
Flight distances:
Edmonton to Frankfurt 7?309 kilometers (4,542 miles)
Toronto to Frankfurt 6,352 kilometers (3,947 miles)
Edmonton to Rome 8,240 kilometers (5,120 miles)
Toronto to Rome 7,100 kilometers (4,412 miles)
Of course, this assumes direct non-stop flights to those locations. While non-stop connections from Toronto are likely, non-stop connections from Edmonton are perhaps less so. Western Canada flights to Europe often make a stop in Toronto or Montreal before crossing the Atlantic Perhaps a better comparison can be obtained by looking at shipping rates for parcel service from each City. While this method certainly won't reflect the rate a corporate customer would pay, it will reflect at least a preliminary price differential for shipping to international locations from the two locations. It also provides a basis for comparison of cost differentials that can be expressed as a percentage for Aurora vs the competition, based on the competition's locations. For example:
T9E 0V6 (postal code for Edmonton International Airport. locations of Aurora Sky)
K7A 0A8 (Smith Falls Ontario, location of Canopy Growth Hershey's factory)
First I will try Canada Post Xpress post. This is a 5 day delivery guaranteed delivery service to Germany.I am going to use an arbitrary number for the volume of 1 kg of marijuana as 6" x 6" x 10" and get a rate to ship 1 kg for each destination:
T9E 0V6 to Germany $84.48 CAD
K7A 0A8 to Germany $84.48 CAD
Ok so Canada Post doesn't differentiate, at least for their online retail shipping cost estimator. What about say Purolator? Destination is more specific with Purolator, so I am using Frankfurt as it is a major international airport hub. This time I am using 10 kg and a shipping date of April 2nd(Purolator doesn't ask size for their basic online cost estimator). I am not declaring a value. Delivery is 3 business days from Edmonton, equivalent service is 2 days from Smith Falls.
T9E 0V6 to Frankfurt $429.20 CAD
K7A 0A8 to Frankfurt $429.20 CAD
Shipping to Rome produced the same results. Based no this preliminary survey, their is no cost advantage to either location. The only advantage goes to Smith Falls, based on delivery time. Of course, a regular commercial delivery contract would bring out sharper pencils ...
In terms of domestic shipping, without bothering to run rates, I think it would be fair to say that Aurora would have a definite advantage for Western Canada, with Canopy likely holding the advantage for Eastern Canadian destinations.
The following link is to a PDF file that shows all insider transactions reported by Canadian Insider for ACB from the past 6 months. I added monthly totals based on the transaction date. Note that the monthly totals include all transaction types. If you want specific transactions you'll have to go to Canadian Insider and open your own basic account.
The PDF is hosted on Docdroid. I've never used it before, hopefully the link works without problems
https://www.docdroid.net/xKNAVCw/acb-insider-transactions.pdf
What I see is the exercise of stock options, followed by selling of the resultant shares. It appears to be Nicholas Whitehead, who is the VP of Market Development.
If you scroll and look at the chart (see link below), there are also open market insider buys. The overall result appears to be net insider buying, offset in part by some insiders exercising their stock options and selling the resultant shares.
https://www.canadianinsider.com/node/7?menu_tickersearch=ACB+%7C+Aurora+Cannabis
What interests me more than share count are the following numbers (prices in CDN$):
Aurora (source: https://ca.investing.com/equities/aurora-cannabis-historical-data )
Share Price
May 22, 2014 $0.03 (first day of price reporting on Investing.com)
March 12, 2018 $11.65
(38733% change)
Equivalent time period for Canopy Growth (source: https://ca.investing.com/equities/tweed-marijuana-inc-historical-data )
Share Price
May 22, 2014 $2.61
March 12, 2018 $32.49
(1145% change)
Of course, you could also look at the increase in Market Cap for both companies. Either one is more meaningful than share count, which of itself communicates nothing about return on investment or increase in the value of the company.
Aurora Eyes Nasdaq, NYSE Listing as Canada Pot Stocks Go Global
7 March 2018, 8:14 AM
7 March 2018, 7:35 AM
(Bloomberg) -- Another one of Canada’s biggest marijuana producers is exploring a listing on an international exchange.
Aurora Cannabis Inc. is “absolutely” looking at trading its shares on the Nasdaq Stock Market, the New York Stock Exchange or the AIM, a division of the London Stock Exchange, Chief Executive Officer Terry Booth said in an interview Tuesday in Edmonton, Alberta. While the company is already attracting a high volume of investors in Canada, more banks and institutions are looking to get into the market, he said.
“We’re all over it,” Booth said. “We’ll look at all exchanges, we’ll look at New York Stock Exchange.”
Last month, Cronos Group Inc. became the first Canadian marijuana company to trade on the Nasdaq Stock Market alongside stocks such as Apple Inc. and Microsoft Corp. Canopy Growth Corp., Canada’s first marijuana unicorn that now has a market value of C$6.52 billion ($5 billion), has said it intends to list on the Nasdaq.
Aurora, with a market value of C$5.75 billion, is doing due diligence on the U.S. market before it pursues a potential listing since marijuana remains illegal at the federal level, Booth said. The company is looking at listing on an exchange that makes the most sense, he said.
“Cronos broke that barrier, and good on ’em, it’s excellent for everybody,” Booth said.
©2018 Bloomberg L.P.
source:https://www.bloombergquint.com/onweb/2018/03/07/aurora-eyes-nasdaq-nyse-listing-as-canada-pot-stocks-go-global
The case for buying Aurora discussed at length in this well-written article along with 3 other companies.
https://seekingalpha.com/article/4146260-s-curve-reveals-early-days-marijuana-growth-cycle?page=2
Canadian Cannabis Giant Aurora Hits Heavy in Germany
If you are one of those entrepreneurs closely watching the public sector of cannabis finance, you have no doubt heard of Aurora. Aurora Cannabis Inc. is second only to Canopy Growth Corp as one of Canada’s leading producers and distributors of cannabis. But Canopy has some stiff competition, as it would appear that last year, Aurora nearly doubled both the amount of cannabis sold and patients whom they are serving. That drastic uptick in services can be accounted for by the introduction of one single new legal medical marijuana market that Aurora now serves in Europe: Germany.
According to Mark Rendell at the Financial Post:
“Along with quantity, revenue growth came from an increased average price per gram sold, which jumped to $8.36 from $5.96 in the same quarter last year. That increase was thanks in large part to exports to Germany, where medical cannabis prices are significantly higher, through its subsidiary Pedanios GmbH.
“‘The big mover here is Germany, and that’s a huge validation of the acquisition of Pedanios, which cost about $23 million,’ said Cam Battley, Aurora’s chief corporate officer.
“…All told, Aurora more than doubled its German sales between the first and second quarter, selling $2.5 million worth of dried cannabis in German pharmacies in the second quarter. That accounted for fully 20 per cent of the company’s total revenue.”
Pedanios is a pharmaceutical wholesale distribution company which Aurora purchased last year that supplies products directly to German pharmacies. The acquisition, it would seem, is paying off dramatically and quickly. And as has been widely predicted, the introduction of a new patient market in Germany has deeply impacted those working to create medical cannabis access in Europe. One can expect to see more European markets opening and looking to Germany for leadership in how to handle their new policies.
source: https://internationalcbc.com/canadian-cannabis-giant-aurora-hits-heavy-germany/
"If the amount of shares grow and simultaneously the company's revenues and assets grow nothing was diluted."
Once again, I would refer you to the definition of dilution. The very act of increasing the share count is, by definition, dilution. That said, grasping the impact of the dilution is what matters ... while each share held now represents a smaller percentage of the company, was the value of the company increased enough to offset the impact of that dilution?
By what percentage did the number of shares increase?
By what percentage did revenue increase?
By what percentage did their assets grow? (remember, a lot of numbers get thrown around on posting boards that have no basis in reality, like greenhouses supposedly worth $1B cough cough)
More importantly:
By what percentage did present earnings, as well as potential future earnings increase?
What liabilities did they take on?
etc.
Aurora is more than the sum of the parts, however, the value of that whole is only going to be revealed in time. Let's face it: until some real revenues, earnings and costs become known in the year following legalization, it's all one big crapshoot.
Are you aware of the market cap of Aurora vs CMED?
If not, or you don't understand how to determine the overall value of Aurora vs. any other marijuana producer, taking the time to educate yourself might be a worthwhile investment of your time. How else would you know if you're over or under-paying for Aurora shares vs. the competition?
Company A shares trade for $100/share
Company B shares trade for $20/share
Both companies produce the exact same product in identical facilities, and have identical costs, debt structure, etc.
Which company is properly priced? Which represents the better opportunity to purchase? Hard question to answer unless you understand the basic concept of what a market cap is.
An article on market cap vs share price:
https://www.thebalance.com/why-per-share-price-is-not-important-3140791
... and remember, when it comes to educating yourself/answering questions, Google is your friend ... or you can always follow the words of the posting-board prophets who issue statements beginning with "I believe" and "I think"
Dilution is not a dirty word. The definition of dilution is pretty straightforward.
Definition of dilution
The question is not whether the issuance of new shares by Aurora is dilutive. By definition, it always is. The question investors need to ask is whether the effect of the dilution is neutral, additive or subtractive to the value per share of the company in question, both in the immediate present and in terms of future value.
For example: Company A with 1 million existing shares, issues 1 million new shares, while simultaneously announcing the funds will be to build a new greenhouse. Their PR states the greenhouse will double the size of their existing production.
This poses a lot of questions. All need to be answered before the dilution can be properly valued.
1. Will the funds raised cover the cost of the new greenhouse, or can investors expect additional financings? Will the need to service additional debt (if that is the path chosen) weigh on future earnings?
2. While production will be doubled, will that automatically translate into a doubling of net earnings? The cost of a new facility might not be as cost-effective as an existing facility. On the other hand, overall staffing may not double due to the efficiencies of a larger production capacity.
3. Will the price received for current production hold true for the new production? Or is it going to supply a different market? (i.e.: recreational vs medicinal). If it is a different market, can the costs incurred and prices received be known at this point in time to allow a proper valuation? (for example, receiving $8/gm for medicinal and all the marketing, shipping and other associated costs that go with it, will not be the same as the value received for recreational vs. associated costs).
4. Has management demonstrated the consistent capacity to execute expansion plans on time and on budget?
That's only a partial discussion of the factors that must be assessed by an intelligent investor. OR you can simply be a sheep and blindly lap up every positive post and ignore every negative ...
Discussion boards can be extremely beneficial when used for constructive discussion instead of blind cheerleading and bashing. In my experience, unfortunately, that tends to be a rare occurrence.
You might want to re-read the news release, especially the plans to CONVERT EXISTING STORES and add new ones. Aurora/Liquor Depot already took the separation of pot sales into account.
Directly form the news release:
Liquor Stores intends to use the net proceeds from the Private Placement to establish and launch a leading brand of cannabis retail outlets, whereby it will convert some number of Liquor Stores' existing retail outlets into cannabis retail outlets and establish new cannabis retail outlets.
With Aurora getting into the retail distribution of pot in Western Canada (Alberta and British Columbia), here's a timely piece on the current status of post-legalization distribution plans for Canadian Provinces and Territories
https://globalnews.ca/news/3998441/marijuana-weed-legalization-canada-where-to-buy/?utm_source=Article&utm_medium=Outbrain&utm_campaign=2015
Two problems with the hedge fund article that jump out at me immediately:
1. The article states the hedge fund shows a short position for Aurora and Canopy as of their Q4 newsletter. Depending WHEN in Q4 they established those short positions, they are most likely still in some stage of serious hurt at the moment.
2. The article focuses on the lack of access to the California market as a partial justification for a short position. That's all well and fine, but negating/dismissing the rest of the world market is a serious oversight.
That said, anyone paying attention to trends on a daily chart has to notice the decline of Canopy and Aphria since Jan 10th. Other than the initial reaction/correction from which it's since recovered, Aurora has mostly resisted that downward pressure until the past few days, likely due to ongoing developments.
Aurora Alternatives/Sleeping Giants?
Two growers in different stages of development for production are Sunniva and Village Farms International (TSX: VFF OTCQX:VFFIF). I thought I might bring these up in part as comparisons/points of discussion to Aurora in terms of competition that will hit the market. And who knows? Possible take-out targets? I would think Village Farms in particular has to look very attractive as a potential target.
Considering the space each currently has under development(Sunniva is in the process of building a greenhouse in California; Village Farms is currently converting current greenhouse space for MJ production) and the planned future space for each (Sunniva has plans for a greenhouse in Oliver BC to serve the Canadian market; Village Farms has considerable additional greenhouse space in Canada and the US they can convert), I'm wondering what thoughts anyone might have on these two as potential sleeping giants. Their current market caps are only a fraction of ACB's or any other large Canadian producer).
Sunniva is in a joint partnership (no pun intended) with Emerald Health (TSXV: EMH)
As of Jan 23rd closing price here are their Market Caps (all in CDN$)
Sunniva $363M
Village Farms $367M
Emerald Health $704M
Aurora $6.56B
Needless to say there is an element of risk with each, given their involvement in the US MJ market.
Village Farms latest slide deck:
http://villagefarms.com/wp-content/uploads/2014/08/VFF-Investor-Presentation-Jan-22-18.pdf
Sunniva latest slide deck
https://www.sunniva.com/wp-content/uploads/2018/01/VERSION-2-Sunniva-Corporate-Presentation-January-23-2018.pdf
I have a small holding in each of these.
What are the market hours for the trading of OTCQX, OTCQB and Pink securities?
Trading in OTCQX, OTCQB and Pink securities may take place Monday-Friday from 6:00 AM to 5:00 PM. The majority of quoting and trading occurs between the open market hours of 9:30 AM to 4:00 PM (Eastern); however, market participants are free to quote and trade at any time as long as they comply with current regulations (e.g., FINRA Best Execution).
source: http://www.otcmarkets.com/learn/otc101-faq#learn-trading-faq9
ACBFF is a QX listing
Aurora Cannabis Provides Update on International Activities
Canada NewsWire
EDMONTON, Jan. 23, 2018
TSX: ACB
EDMONTON, Jan. 23, 2018 /CNW/ - Aurora Cannabis Inc. ("Aurora" or the "Company") (TSX: ACB) (OTCQB: ACBFF) (Frankfurt: 21P; WKN: A1C4WM) is pleased to provide the following update on the Company's international activities.
Denmark: Acceleration to Market
Further to Aurora's January 4, 2018 news release, the Company's Aurora Nordic joint venture will be accelerating its time to market in Denmark with the retrofit of an existing 100,000 square foot greenhouse in Odense, Denmark owned by Alfred Pedersen & Søn ("APS"). Subject to licensing by Lægemiddelstyrelsen, Denmark's Medicines Agency, this will enable Aurora Nordic to commence the cultivation of cannabis during the summer of 2018, while the company is constructing its new purpose-built high-technology 1,000,000 square foot production facility.
Italy: First Tender
Further to the Company's news release of January 18, 2018, Aurora today announces that the amount of product for the first tender consists of three lots with different cannabinoid profiles, totaling 100 kg. Further orders by the Italian Ministry of Defense will be subject to additional tender processes, in which Aurora and Pedanios will continue to participate. While the first tender was set at 100kg, the Italian Ministry of Defense has the option to increase the amount requested.
This is Aurora's first step into supplying the tightly restricted Italian market, and provides Aurora with first mover advantage. Prior to the new tender process, medical cannabis in Italy has been supplied through two sources only: the Ministry of Defense, and seven distributors licensed to procure medical cannabis from the Ministry of Defense, or source internationally from the Dutch Office of Medicinal Cannabis. No import licenses from other sources into the Italian market have been granted to date.
Germany: Rapid Market Growth
The German market continues to develop rapidly. During the period covering March 2017 to end of November 2017, approximately 13,000 people applied for reimbursement of their medical cannabis prescription, with a 65% approval rate. Insurance company AOK Versicherung, which represents approximately 50% of all insured people in Germany, published that in December 2017 alone, approximately 7,500 people applied for reimbursement through that company, which implies a national figure of 15,000 for all of Germany, for that single month.
To date, Pedanios remains the EU's largest distributor of cannabis by volume of product sold, has completed deliveries to over 2,200 pharmacies, and continues to build market share rapidly. Pedanios remains the only distributor to offer cannabis flower sourced from both Canada and the Netherlands, and offers 11 of the 15 licensed varieties in Germany.
Australia: Import/Export Permit Granted
Cann Group has been granted a license to import and/or export cannabis genetics and medicinal cannabis products by the Australian government's Department of Health, through the Office of Drug Control (ODC). The license enables Cann Group to import genetics from Aurora to help broaden the company`s portfolio of medical cannabis products, pending Aurora's receipt of an export permit from Health Canada.
About Aurora
Aurora's wholly-owned subsidiary, Aurora Cannabis Enterprises Inc., is a licensed producer of medical cannabis pursuant to Health Canada's Access to Cannabis for Medical Purposes Regulations ("ACMPR"). The Company operates a 55,200 square foot, state-of-the-art production facility in Mountain View County, Alberta, known as "Aurora Mountain", a second 40,000 square foot high-technology production facility known as "Aurora Vie" in Pointe-Claire, Quebec on Montreal's West Island, and is currently constructing an 800,000 square foot production facility, known as "Aurora Sky", at the Edmonton International Airport, as well as is completing a fourth facility in Lachute, Quebec through its wholly owned subsidiary Aurora Larssen Projects Ltd.
In addition, the Company holds approximately 17.23% of the issued shares in leading extraction technology company Radient Technologies Inc., based in Edmonton, and is in the process of completing an investment in Edmonton-based Hempco Food and Fiber for an ownership stake of up to 50.1%. Furthermore, Aurora is the cornerstone investor with a 22.9% stake in Cann Group Limited, the first Australian company licensed to conduct research on and cultivate medical cannabis. Aurora also owns Pedanios, a leading wholesale importer, exporter, and distributor of medical cannabis in the European Union, based in Germany. The Company offers further differentiation through its acquisition of BC Northern Lights Ltd. and Urban Cultivator Inc., industry leaders, respectively, in the production and sale of proprietary systems for the safe, efficient and high-yield indoor cultivation of cannabis, and in state-of-the-art indoor gardening appliances for the cultivation of organic microgreens, vegetables and herbs in home and professional kitchens. Aurora's common shares trade on the TSX under the symbol "ACB".
On behalf of the Boards of Directors,
AURORA CANNABIS INC.
Terry Booth
CEO
Aurora Exclusive Winner of First Italian Government Medical Cannabis Tender
Canada NewsWire
VANCOUVER, Jan. 18, 2018
First Private Company to Directly Supply Cannabis to Italian Market
TSX: ACB
VANCOUVER, Jan. 18, 2018 /CNW/ - Aurora Cannabis Inc. ("Aurora") (TSX: ACB) (OTCQB: ACBFF) (Frankfurt: 21P; WKN: A1C4WM) today announced that, together with its wholly owned German subsidiary Pedanios GmbH, the Company has won a highly competitive EU-wide public tender to supply medical cannabis to the Italian government through the Ministry of Defence, who oversees medical cannabis production and distribution in Italy.
While the Italian Ministry of Defence currently produces medical cannabis for the domestic market, certain wholesalers are permitted to purchase directly from the Dutch Office of Medical Cannabis, a sharp rise in demand has led to the government seeking external parties to provide additional supply. The EU-wide public tender process consisted of 2 rounds. In the first round, those companies eligible to move towards the final tender round were pre-qualified. Only two companies, including Pedanios, qualified for this final round, in which Pedanios was ultimately chosen as the sole supplier under the tender. Following the signing of the contact in the coming days, Aurora will export product into Germany through Pedanios, who will supply the Italian market through the Ministry of Defence.
"I am very proud of Aurora and the Pedanios team for the quality of their execution in becoming the exclusive winner of this important tender, and gaining access to one of the largest and most restricted markets in Europe," said Neil Belot, Chief Global Business Development Officer. "Aurora will soon supply both Germany and Italy - two of the largest EU markets, with a total population exceeding 143 million. As the only company to have been successful in this tender, we have an incredible first mover advantage in this potentially tremendous growth market."
Andrea Ludwig Ferrari, responsible for sales and market development in Italy, added, "Aurora and Pedanios' EU GMP certifications were crucial in being successful in our bid for the tender in this demanding jurisdiction. We are now the first private cannabis company in the world able to supply the Italian government directly, a testament to the quality of our operations and the standing of our organization. This win positions us exceptionally well to continue executing successfully on our aggressive international expansion strategy."
There is a stock board myth (that is also propagated on various blogs, etc.) that placing a sell order on your shares (usually at a price much higher than the current share price) stops your broker from lending them out.
It's a myth. It does not stop your broker from lending them out. Your broker can still lend them out, and will have 2 days to replace/recall the loan if you do actually sell the shares (ever hear of T+2 to allow the trade to settle?).Phone your broker and ask them.
The single best way to stop your shares from being loaned out is to be knowledgeable about the account you hold the shares in. Read the account agreement. Make sure the account you are holding the shares in is appropriate to your needs and the level of control you wish to have over what your broker can or can not do.
Pretty much all margin account agreements allow your broker to lend out shares. Some stipulate that the shares will only be lent if you are actively using margin, some give the broker a blank slate to lend regardless of whether you are drawing on margin or not.
In Canada, brokers can not lend out shares held in a registered account (RRSP, etc). Similar laws apply in the US.
Again, don't take the word of myself or any other poster on a posting board or rely on some blog. It's the internet. Myths, liars and people talking out of their butthole abound. READ YOUR ACCOUNT AGREEMENT. ALTERNATIVELY, PHONE YOUR BROKER AND ASK.
SCHEDULE 14F-1
<snippet>
Changes in Control
Subject to Closing and 10 days from the date this statement is filed with the Securities and Exchange Commission and mailed to stockholders of record, the Company will (i) increase the size of the Board of Directors from six (6) board members to seven (7), (ii) the following directors will resign from the Company’s Board of Directors (the “Resigning Directors”) and (iii) the Resigning Directors will be replaced by the following persons (the “Proposed Directors”):
Name of Resigning Director
Gary Elliston
William Strange
Fred Zeidman
Name of Proposed Director
Manfred Shiu
Johan Wang
Markos Armanious
Dr. David Ho
The increase in the size of the Board from 6 to 7 directors of the Company, the resignation of the Resigning Directors, and the appointment of the Proposed Directors will not be affected until after Closing of the Agreement.
See the entire filing here