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Conference call at 8:30 Aphria and Tilray Combine to Create Largest Global Cannabis Company With Pro Forma Revenue of C$874 Million (US$685 Million)
Bloomberg reported they are very close
Agreed here it is in full! LOAD. The Motley Fool
Could Aphria Be a Millionaire-Maker Stock?
Investors piled into pot stocks in 2018, but it will take time and effort to use them for building long-term wealth.
Howard Smith (TMFBuilt2Last)
Dec 12, 2020 at 7:25AM
Two years after Canada officially legalized recreational marijuana, investors are still searching for the winners. But investors looking to build lasting wealth in the sector have a better base to research which investments could make them rich today than they did two years ago.
A speculative sector like cannabis will particularly take time to play out, as government regulations play a large role in the business thesis. But there is more clarity -- and some lower share prices -- this long after the Canadian decision in October 2018. Along with disappointing returns, some businesses continue to struggle. But Canadian grower Aphria (NASDAQ:APHA) isn't one of them.
marijuana buds with judge's gavel on top of American flagIMAGE SOURCE: GETTY IMAGES.
Do it Buffett's way
Becoming a millionaire from your investments is most likely accomplished by holding good businesses for many years. Warren Buffett likes businesses with large moats that can help compound their earnings over time, and that trade at what he considers good valuations.
The marijuana sector is less about moats and more about speculating on the potential market -- so it's difficult, if not impossible, to invest exactly as Buffet would. But valuations have certainly improved since the original hype drove up shares two years ago. Aphria, for example, has a current price-to-sales (P/S) ratio of about 5, down from more than 75 in late 2018. And Aphria has grown its sales compared to some peers, even as its share price moved down.
APHA Chart
APHA DATA BY YCHARTS
A transformational acquisition
The thesis for an investment in Aphria hinges on growth in the recreational marijuana market. Supporters of legalization in the U.S. have had some success at the state level. Five U.S. states passed ballot initiatives concerning the legalization of marijuana in the recent election. Though federal legalization is still not a near-term likelihood, the investment thesis is based on it eventually occurring. Companies that want to be prepared are already building a framework. Beverage company Constellation Brands (NYSE:STZ), for example, added to its initial $4 billion investment in Canopy Growth (NASDAQ:CGC) with another almost $200 million invested through warrants earlier this year.
Aphria is also using a beverage company to grow in the U.S. It announced an important acquisition in the U.S. in early November. Behind the headlines of the purchase of craft brewer SweetWater Brewing Company is a path into the U.S. cannabis market. While the $300 million acquisition will be immediately positive for Aphria's business, it's the potential long-term benefits that really make the deal exciting for shareholders. SweetWater Brewing sells the most popular hemp-flavored beer in the country. In the announcement of the purchase, Aphria said that it provides "a platform and infrastructure within the U.S. to enable it to access the U.S. market more quickly in the event of federal legalization."
Ahead of the competition
Prior to the SweetWater acquisition, Aphria was already well-positioned in Canada, boasting the top market share in both Ontario and Alberta. Total revenue grew 15.5% in its quarter ending Aug. 31 compared to the prior year period.
That double-digit sales growth is likely to continue, especially considering the strong sales growth in the overall Canadian market. During the third quarter, for example, the cannabis market in Ontario grew 54% to be worth $700 million, according to the company.
But for Aphria to be a millionaire-maker, the U.S. market will have to be open to the company. Having the infrastructure in place with SweetWater puts Aphria ahead of its competition in the event of legalization. Not all cannabis companies will thrive even if the U.S. market opens. But Aphria has put the foundation in place to do so, and investors could have a millionaire-making stock in their portfolio if recreational marijuana is legalized in the U.S.
Aphria wins in best overall CBD (Solei), best indica pre-roll (RIFF), best cartridge (Good Supply) and best craft cannabis, for Broken Coast.
Aphria is a licensed producer headquartered in Leamington, Ontario, and the proud purveyor of multiple brands, including kind award winners Solei, Riff, Good Supply and Broken Coast. Taken together, these four brands scored Aphria wins in best overall CBD (Solei), best indica pre-roll (RIFF), best cartridge (Good Supply) and best craft cannabis, for Broken Coast. Bernard Yeung, senior vice president of sales & marketing at Aphria spoke to kind editor Ben Kaplan on what it means for his company to win so many budtender-voted awards of the year. https://kindmagazine.ca/article/kind-awards-2020-aphria/
House Passes Landmark Bill Decriminalizing Marijuana
https://www.nytimes.com/2020/12/04/us/politics/house-marijuana.html
U.S. House gears up for historic vote on cannabis legalization (seeking alpha) (GET IN NOW! IMO)
Dec. 04, 2020 9:53 AM ETAurora Cannabis Inc. (ACB)By: Mamta Mayani, SA News Editor1 Comment
Members of the U.S. House of Representatives are expected to cast a historic vote today on the Marijuana Opportunity Reinvestment and Expungement Act, or MORE Act, which would remove pot from the U.S. list of controlled substances.
The bill, would decriminalize marijuana on the federal level and create pathways for ownership opportunities in the emerging industry, allow obtaining medical cannabis recommendations and establish funding sources to reinvest in communities affected by the war on drugs.
However, MORE Act is unlikely to become law soon because the U.S. Senate has not shown willingness to act on it. Also, the drug wouldn’t automatically become legal nationwide, as each state would utlimately determine whether pot could be sold there.
The vote would arrive roughly a month after five states — New Jersey, Arizona, Montana, South Dakota and Mississippi — voted on Election Day to legalize recreational or medical cannabis.
Rep. Earl Blumenauer said last week the vote would be the first held by the full House or Senate on a measure to end federal pot prohibition since it took hold via the Controlled Substances Act of 1970.
"It is the right thing to do," said a co-sponsor of the MORE Act, Rep. Earl Blumenauer.
Marijuana stocks have also risen as Democratic President-elect Joe Biden prepares to transition into the White House.
Aphria gets big target price raise from Haywood
Nick Waddell
By Nick Waddell
18 hours ago
December 2, 2020
Home / All posts
aphriaHaywood Capital Markets analyst Neal Gilmer is giving the thumbs up to the new acquisition by Canadian cannabis company Aphria (Aphria Stock Quote, Chart, News TSX:APHA), which just bought entry into the US market via acquiring craft brewer SweetWater.
https://www.cantechletter.com/2020/12/aphria-gets-big-target-price-raise-from-haywood/
42 ps back in mar
APHA FB post: Today we announced management will host a fireside chat discussion at the Jefferies Virtual London Healthcare Conference on Wednesday, November 18, 2020 at 9:05 a.m. ET. For details https://bit.ly/3kwKeKa
Seeking alpha “Aphria: Time To Take It Nov. 10, 2020 3:26 PM ETAphria Inc. (APHA)”
$40 high end return by 2025?!
Link:
https://seekingalpha.com/article/4387730-aphria-time-to-take?utm_medium=email&utm_source=seeking_alpha#alt2&mail_subject=apha-aphira-the-race-to-profitability&utm_campaign=rta-stock-article&utm_content=link-0
https://thcnet.com/news/aphria-ceo-bullish-on-cannabis-drinks
Aphria chairman and CEO Irwin Simon believes that beverages will become one of the biggest segments in the cannabis industry once adult-use marijuana is federally legalized in the U.S.
In a conversation with THCnet, Simon explained his bullishness on the cannabis-infused drinks segment and shared why his company agreed to acquire Atlanta-based craft beer maker Sweetwater Brewing for $300 million — a deal that caught those in both the beer and cannabis industries by surprise.
Major alcohol players like Anheuser-Busch InBev (Tilray), Constellation Brands (Canopy Growth), and Molson Coors (Hexo) have made significant investments into Canadian cannabis firms, while companies like Heineken-owned Lagunitas (Hi-Fi Hops) and Pabst Brewing (Pabst Labs) have also dipped their toes into the cannabis drinks space with partnerships and licensing deals.
However, it is believed that Aphria’s deal to acquire a U.S. craft beer company is a first of its kind — one that brings a U.S. alcohol manufacturer and a Canadian cannabis firm together under one roof.
Though unique, the partnership represents a natural evolution of Aphria’s business model, according to Simon.
“We have always considered ourselves as a CPG company with a focus around building our consumer brands like any company that sells baking mixes or snack brands,” he said.
And now that Aphria has access to a profitable beer company with years of brewing expertise, as well as valuable cannabis-themed brands like 420 Extra Pale Ale, Hydroponics Seltzer, and its G13 IPA infused with terpenes, Simon believes there’s reason to be bullish on the future of cannabis-infused beverages.
“I am betting that it will be as big as White Claw and Truly,” he said.
That probably seems hard to imagine now, and for good reason. Sales of hard seltzer — which currently make up roughly 10% of total U.S. “beer” volume — topped $3.3 billion through the first 9.5 months of 2020. Analysts at Credit Suisse estimate the category will grow to account for 25% of total beer volume by 2025.
If that forecast proves accurate, our back-of-the-envelope calculation puts the hard seltzer category somewhere north of $10 billion by 2025.
But sales of cannabis drinks in the U.S. are nowhere near that at the moment.
While several emerging CBD-infused drinks companies like Mad Tasty and Recess are beginning to build a category of hemp-derived beverage offerings that can be sold at mainstream retail outlets, the market for THC-infused beverages that get consumers high is still nascent.
The largest producer in California, Cann, has raised $5 million from an impressive roster of well-known celebrities, but even that company will only move about 3.5 million units this year.
Other brands like Wunder and Two Roots are also making headway, but without the ability to sell THC-infused drinks at liquor stores and chain outlets, growth potential is limited.
Research firm BDSA predicts that sales of all cannabinoid beverages could reach $1.7 billion by 2024, but CBD-infused offerings will likely make up the biggest chunk of those sales due to their expanded distribution opportunities.
Nevertheless, Simon remains optimistic.
“If any category is going to get into THC, I believe it will be beverage companies and ultimately the different liquor boards can regulate that,” he said, noting that he envisions a future where low-dose THC-infused drinks are sold at traditional retail stores.
aphria-sweetwater
Simon said he also believes cannabis drinks are healthier for consumers, pointing to the fact that they often contain fewer calories than a typical beer and do not cause hangovers.
While that may be true, not everyone is sold on the potential market opportunity for cannabis drinks.
Brent Williams, the founder of investment management firm Highwater Financial, told THCnet that he doesn’t believe THC-infused beverages will be a “significant portion” of the U.S. cannabis segment.
“If you look at some of the more mature markets, cannabis beverages account for 5% and below of total sales,” he said of states like California, Colorado, Oregon and Washington. “It is also one of the slower growing product categories. The sales within the industry today don’t back up the insane amount of bullishness that’s behind it.”
However, part of the reason why cannabis drinks lack the kind of market penetration needed for investors like Williams to get excited is because the current supply chain is not designed to support a robust beverage business: Dispensaries aren’t outfitted with coolers and storage space, and cannabis distributors aren’t well-equipped to deliver heavy drinks.
That’s prevented both emerging and established players from investing heavily into building the drinks category within the dispensary channel, especially as the possibility of selling at mainstream retail looms on the horizon.
That will change in 2021, when Canada's Canopy Growth Corporation launches its cannabis-infused beverages in the U.S. via a partnership with New York's Acreage Holdings. The move is aimed at helping Canopy develop a leading position in the THC-infused drinks market ahead of any loosening of federal cannabis laws, which would trigger its agreement to acquire Acreage.
Even if that happens, Williams isn't convinced that growth is guaranteed.
"It's going to be a very, very long time until you can sell cannabis beverages outside of the dispensary," he said. "It will take years even after cannabis is legalized."
For his part, Simon said he’s ready for any outcome, including one where cannabis isn’t immediately legalized at the federal level and the company is restricted to selling only hemp-derived beverages in the U.S.
“We bought this business because it is a great craft beer business first,” he told THCnet. “We bought this business because it has a great brand name. We bought this business because it gets us into the U.S. market. And we bought this business because we got an excellent management team that can help us in the beverage business. There is still a lot more that will play out here. And when cannabis is legalized, we will be ready.”
Indeed, once the acquisition is complete, Aphria will own the 14th largest craft brewery in the U.S., and have access to beer distributors and retailers in 27 states. It will also be able to bring the 420 brand to Canada, where Simon said there is a "very big possibility" that Sweetwater-branded drinks and other cannabis products could be made.
"In Canada, where it is legal, we could use the Sweetwater or 420 brand to develop and sell THC-infused drinks," he said, adding that there is "no reason" there can’t also be 420-branded edibles.
To read more about Aphria’s deal to acquire Sweetwater, please see last week's coverage.
Aphria, Inc.
Aphria, Inc.
Aphria Inc. produces and sells medical cannabis in Canada and internationally. The company offers pharmaceutical-grade medical cannabis; and adult-use cannabis under the Solei, RIFF, Good Supply, and Broken Coast brands. It serves patients and consumers through distributors and online.
Icon TRENDING
Several US Cannabis Companies ‘Targeted’ During Nationwide Protests as Business Owners Lose Millions to Looters
Alcohol Delivery Giant Drizly Launches On-Demand Cannabis E-Commerce Company
High Times CEO Stormy Simon Resigns After 4 Months
New Frontier Data: Cannabis-Infused Product Sales Will Approach $3 Billion in 2020
Mark Dowley Resigns from iAnthus Capital Holdings' Board of Directors
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Gotta-git-it: Seconded..Phantom?
5.5 million volume after 30mins
“Something tells me, this forum will get a but more exciting in the coming weeks”
You are now an owner in this:
"SweetWater was the 14th largest craft brewing operation in the U.S. this year, according to the independent Craft Brewers Association. The brewery distributes beer in 27 states plus Washington D.C. Their beer is available in over 29,000 locations in those states.
SweetWater says their beer production over the past year has increased by 7%, twice the growth of the craft beer market nationally."
21 million shares today
Aphria: Canaccord Upgrades Price Target To $11.00 Following SweetWater Transaction. On Wednesday, Aphria Inc (TSX: APHA) (NASDAQ: APHA) announced that it had entered an agreement to purchase 100% of SweetWater Brewing Company for a total of U$300 million with a U$66 million cash earn-out that will run through 2023.1 hour
Conference Call & Webcast Presentation
Aphria executives will host a conference call and webcast with a supplemental presentation to discuss the SweetWater Brewing Company acquisition today, November 4, 2020 at 4:20 p.m. Eastern Time.
I second this: floridajim1: “Maybe Phantom might ask Peter about the idea of the principals making open market stock purchases. At these prices do they or do they not have faith in the company that's paying them fat salaries with no tangible results?”
December, we’re gonna be like Europe is now. (March) This went to $42. Plus Biden’s gonna win. IMO
"I'm thinking this will get back to $40..."
Phantom?
A quarter million and waiting...
Reminder: OMID ran to .06 in June
FDA REGISTERED!! Election 12 days away
NEW INTERVIEW WITH CEO IRWIN SIMON
Aphria Looks to Brand Power to Continue Driving Its Global Strategy
October 21, 2020 at 1:55 pm
Exclusive article by Carrie Pallardy
Exclusive Interview with Aphria CEO Irwin Simon
The strength of Aphria’s (TSX: APHA) (NASDAQ: APHA) brands, team and grow facilities are helping it to stand out in the cannabis industry, according to CEO Irwin Simon. He spoke with New Cannabis Ventures about the profitable company’s global strategy and its positioning for further growth. The audio of the entire conversation is available at the end of this written summary.
Diversified Leadership Experience
Simon has been in the cannabis industry for about two years now. Previously, he worked in the organic and natural product space as the founder of Hain Celestial in 1993. He always tried to be ahead of trends and recognize the next opportunity. Cannabis fits that bill, and he is able to leverage his CPG and organic industry experience in this industry.
Thus far, Simon has been surprised at just how much more room for growth there is in the cannabis business. He sees the opportunity to bring more professionalism to cannabis and to drive further innovation in terms of products and technology.
In addition to Simon, the Aphria team includes experienced leaders like Chief Corporate Affairs Officer Tamara Macgregor. Simon also highlighted CFO Carl Merton, COO Jim Meiers (a Hain veteran), Chief Legal Officer Christelle Gedeon, Chief Strategy Officer Denise Faltischek (a Hain veteran), Senior Vice President of Sales and Marketing Bernard Yeung and CIO Lloyd Brathwaite.
Global Operations
The largest portion of Aphria’s business is currently in Canada. The company has an office in Toronto, Ontario, and its greenhouse grow facilities (Aphria One and Aphria Diamond) are located in Leamington, Ontario. In Leamington, the company has the ability to grow approximately 265,000 kilos of cannabis across about 2.5 million square feet. Aphria also has a 55,000 to 60,000-square-foot indoor grow facility in Vancouver Island, which grows under the company’s Broken Coast brand.
Inside One of Aphria’s Grow Facilities
While some competitors have written down Canadian production assets and inventory, Aphria has not done the same. The company has large facilities with significant capabilities, and Simon only sees the opportunity to utilize those facilities growing as more stores open, more products are released and more consumers enter the market.
Aphria Team Members
In addition to its operations in Canada, Aphria has teams in Europe and South America. Currently, Aphria’s international strategy is focused on medical cannabis. For example, the company is working to open a German facility this year or early next year. Its pharmaceutical business CC Pharma, which sells to more than 13,000 pharmacies, will facilitate the distribution of products, according to Simon.
U.S. Strategy
Aphria also has a strategy for the U.S. market. Rather than focusing on cannabis, the company is looking to build a presence through other health and wellness consumer goods. If and when federal legalization does pass, the company wants to be prepared to introduce cannabis into its existing consumer brands.
The U.S. is also the primary focus of the company’s M&A considerations. Aphria would potentially purchase an asset in the U.S. that has a product legal today.
Strategic Partnerships
Some of Aphria’s peers have secured significant partnerships and investment deals with global companies. A deal like this would be of interest to Aphria, and Simon believes the company to be a prime target for this kind of opportunity. It has strong R&D, brands and product quality. Aphria would not be looking for a strategic partner solely for money. An investment would strengthen the balance sheet, but the company would also be interested in added value such as knowledge or potentially distribution, according to Simon.
Product Branding
Aphria’s portfolio includes brands like its Aphria medical brand, Broken Coast, Solei, RIFF, Good Supply and B!NGO. The company focuses on building brand equity and targeting different consumer groups. All of the company’s products are subject to stringent quality assurance and regulatory controls.
Solei Is One of Aphria’s Brands.
Beyond its current product set, Simon does see the potential for beverages. He expects beverages in the cannabis space could fill different niches, such as focus, relaxation, sleep and pain.
Capital Position
Earlier this year, Aphria swapped some convertible debt for equity on favorable terms. Simon prefers the company to have solid cash flow and low debt, which gives it the ability to use cash for growth. Aphria currently has approximately $400 million in cash, and dollars are being allocated brand development, brand awareness and acquisitions.
Simon is looking to improve the company’s cash conversion cycle and to eliminate any unprofitable elements of the business. He is also aiming to build cash within the company without borrowing funds or raising more money externally.
2020 Outlook
Aphria has suspended guidance due to the uncertainty caused by the COVID-19 pandemic, but Simon recognizes the importance of offering guidance and looks forward to doing so again in the future.
Going forward, new products and access to more stores that will be opening will be major growth drivers for Aphria. Simon also sees some LPs struggling, which could potentially bring consumers to Aphria’s brands.
Aphria’s leadership team tracks important metrics like recreational cannabis sales, cost of production, margins, SG&A and EBITDA. The company also focuses on positive environmental practices and community support. As the largest employer in Leamington, Aphria has worked to help the community during the pandemic, according to Simon.
As Aphria grows, it is looking for ways to educate consumers and build brand awareness in a market that does not allow traditional advertising. Simon is proud of how the company has gained a leading market position and profitability. He looks forward to continuing to do the right thing for Aphria’s consumers, shareholders and employees.
https://www.newcannabisventures.com/aphria-looks-to-brand-power-to-continue-driving-its-global-strategy/
FDA registered and ready to go. Clean room manufacturing. QC background president and CEO. Biden/Harris decriminalizing the industry. Profitable. No float. 500k shares and waiting... .06 run in June!
NEW! Revenue was $356,444, compared to $178,435 for the same period last year, a 99.8% improvement.
Gross Profit was $156,713, compared to $85,650 for the same period last year, a 83.1% improvement.
Net income was $96,819, compared to $8,008 for the same period last year, a 1109.1% improvement.
Operating Results for the Nine Months Ended September 30, 2020
Revenue was $840,922, compared to $505,371 for the same period last year, a 66.4% improvement.
Gross Profit was $362,350, compared to $171,083 for the same period last year, a 111.8% improvement.
Net income was $185,233, compared to $24,978 for the same period last year, a 641.6% improvement.
Investors are missing our growth story: Aphria CEO
Irwin Simon, CEO of Aphria discusses the latest results, which disappointed analysts even though the company posted higher recreational cannabis sales during the COVID-19 pandemic
https://www.bnnbloomberg.ca/video/investors-are-missing-our-growth-story-aphria-ceo-~2055747?jwsource=cl&fbclid=IwAR0ug44S3e9FfjoxWkKiqQuB0eBSdO6Csncc22FrfkQIjZMpgxiRu8VFtzk
For sale? No way! Ran to .06 three in June on the acquisition. FDA registered and ready to go. Clean room manufacturing. WC president and CEO. Biden/Harris decriminalizing the industry. Profitable. No float. 500k shares and waiting...
Kamala Harris said: " if elected, she and Joseph R. Biden Jr. would ban chokeholds, create a national registry for police officers who act illegally, close private prisons and decriminalize marijuana, among other changes to the criminal justice system." https://www.nytimes.com/live/2020/10/07/us/vice-presidential-debate-live-stream
Omid running. News?