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It all depends on how much Cannabis costs where you live.
In Chicago, Legal Cannabis is going for $60-$80 for 3.5 Grams (1/8th).
Personally, I think that is crazy expensive.
So I grow my own instead.
Believe me, if they start charging $60 for a potato at the Super Market - I will probably start growing Potatoes also.
It's a basic "Make or Buy" Decision. Right now, the cost of Cannabis is so high in Chicago - that growing your own is a no-brainer.
The real question is: Is that a good thing? Or a bad thing?
Not too long ago - People were happy when they got some "cheap shares" at $5 also.
Time will tell.
But the only good news I saw last week was not from Aurora.
Yep. All these are true facts.
Lets face reality here: The ONLY REASON why ACB is green today (and last Friday) is because Aurora's BIGGEST COMPETITOR (aka: Canopy Growth) kicked Aurora's A@@.
Canopy kicked Aurora's A@@ in almost every category - and guess what? The Aurora Longs-Longs are cheering!!
Do the Executives at Ford cheer when General Motors sells TWICE the cars as they do?
Does McDonalds cheer at Wendy's for selling TWICE the hamburgers that they do?
Aurora investors should be ANGRY and UPSET. Not cheering.
OMG. Do you have any idea how many times people have posted "The Bottom Is In" on this board?
Right now, the shorts are SELLING shares at $1.62. Any buyers?
When the Huge Funds buy Aurora Stock - it is usually as a Hedge against something else.
And yet...the Long-Longs continue to COMPARE Aurora to Tesla, Amazon, and Apple.
Tesla and Apple have products that require huge amounts of Capital to create. Plus, the technology to make those products is a miracle in itself.
Growing weed? Not so much. Anyone can grow weed.
My 13 year-old nephew has a garden that he grows vegetables in.
He has the SKILLS to grow weed.
LOL!!
Okay, I have a grip now.
OMG!! You are so right!! Growing Cannabis is just like building a Tesla!!
Lets see...put seed in dirt...water...provide light...
Sounds exactly the same to me!!
It sounds like Aurora is the next GW Pharmaceuticals!!
The only difference between GW Pharmaceuticals and Aurora is:
Aurora = $1.60 Share Price
GW Pharmaceuticals = $123 Share Price.
Now why do you think there is such a big difference?
Probably because you can either buy an 1/8th for $60. Or you can grow a pound for $60.
Is that good enough reason?
I'm not preaching to the choir.
I'm preaching to the Long-Longs that keep comparing Aurora to Amazon and Apple.
Like I keep saying:
I can grow great weed in my closet.
But I can't build a Tesla in my closet.
So these comparisons with ACB and the Tech Sector are just plain silly.
Cannabis is not Tech.
Actually, it is the people that SHORTED at $10 that WERE ALREADY rewarded with caviar, 24k gold, LearJet level wealth.
The Shorts made a fortune on ACB.
And Cam & Terry had really lucrative Golden Parachutes.
The people that bought at $10 - Not so much.
The Real Question is:
How Much MONEY will Aurora's Turn-Around Cost It's Shareholders?
It seems illogical that we are even talking about a "Turn-Around" this early in a Company's Life Cycle. But unfortunately, we are.
ACB has made a lot of Bad Business Decisions in the past (paying $3 Billion for MedRelief was just one of them) and these Bad Decisions cost ACB Shareholders dearly.
So the next question is: How much will this Turn-Around cost the Long-Longs?
What Corner has ACB Turned?
Are you confusing Canopy's Earnings Report with Aurora's?
And really, Aurora isn't that cheap.
Aurora has over 5 times the shares outstanding than Canopy. So you have to take the number of shares outstanding into account.
Every time Aurora moves $1 per share, they are adding over $1 Billion in Market Cap.
So the question is: IF Aurora moves from $1.50 to $2.50 - is Aurora worth another Billion Dollars?
Most of the shorts don't think so. And the Financial Statements tend to agree.
I haven't bet against Aurora yet - and I'm not going to start now.
However, there is a difference between not shorting a stock and actually buying long.
The Article that you posted just says don't short Aurora.
It is not saying that Aurora is a buy. In fact, there aren't many Analysts that have a Buy Rating on Aurora right now.
Why do you expect a $3 and $5 Selling Price for Aurora?
I mean, what did Aurora do to deserve a higher Selling Price?
My favorite Black Market Story happened a few years ago.
The "Professional Growers" from the major Cannabis Companies all submitted an ounce of their best weed to the Annual Cannabis Cup Competition. But anyone could compete - you just needed to enter an ounce of weed.
Do you know who won?
Some random guy. He just asked around on the street and bought the best weed he could find and he entered it. No one knows who grew it - but it was definitely great weed.
Cresco's placement of their Dispensary next to Wrigley Field is Genuis.
Aurora and the rest of the Cannabis Companies need to think: Location, Location, Location for Dispensary Placement.
Possible Winning Locations would be:
- Near College Campuses
- Near Nursing Homes (Over 65 Users)
- By large Sporting Venues
- By large Concert Venues
- By State Lines where Cannabis is Illegal (the Company that has Dispensaries closest to the Indiana, Wisconsin, and Iowa borders with Illinois is gonna make BANK$$$)
- By Airports (first stop after landing)
- And I'm surprised Cruise Ships don't already sell it. Maritime Law in International Waters - US Laws don't apply over 2 miles out to sea.
Cresco's placement of their Dispensary next to Wrigley Field is Genuis.
Aurora and the rest of the Cannabis Companies need to think: Location, Location, Location for Dispensary Placement.
Possible Winning Locations would be:
- Near College Campuses
- Near Nursing Homes (Over 65 Users)
- By large Sporting Venues
- By large Concert Venues
- By State Lines where Cannabis is Illegal (the Company that has Dispensaries closest to the Indiana, Wisconsin, and Iowa borders with Illinois is gonna make BANK$$$)
- By Airports (first stop after landing)
- And I'm surprised Cruise Ships don't already sell it. Maritime Law in International Waters - US Laws don't apply over 2 miles out to sea.
People keep knocking Black Market Weed.
But the truth is: Black Maarket Weed is all that anyone had prior to legalization.
I've been consuming weed a long time and I just had my first legal joint in Illinois less than 2 months ago.
I must have been lucky all my life - but I've never had any problems with Black Market Weed. In fact, I bought some killer sweet OG Kush from my girl not too long ago.
The great thing about living in the free market is competition.
If Aurora can deliver a superior product at a competitive price - then knocking out the Black Market is inevitable.
The big Cannabis Companies just need to make it so that the Black Market can't compete on Quality, Convenience, Shopping Experience, Packaging, & Price.
It can be done. Illegal Grows have all the same costs as Legal ones (except taxes) - but the Legal Grows have HUGE Econkmies of Sale on their sides - and Sales Taxes are borne by the Customer (not the grower).
I understand the "Convenience Factor" of texting your guy and having Cannabis delivered to your door via the Black Market.
But Medical Users already have that in Canada. They just get Cannabis Delivered by FedEx instead. And I hear that Health Canada may cover the cost. So that's definitely a Black Market killer.
Also, they already have Cannabis Delivery in Colorado and California. So it's coming...
Actually, Big Companies like Aurora and Canopy are FUELING the Black Market in a lot of places.
For Example: Cannabis is illegal in New York. But boot-leggers from New York are driving to Canada, loading up their cars - and driving back to New York to cut it into dime bags.
It is going to get to a point where trying to run a Black Market grow house is just too risky. There is too much capital involved in Black Market growing and the risks are higher.
IMO - The future of the Black Market will be less growing and more boot-legging.
I wonder how many employees at Aurora came-over from the Black Market?
When you grow on the Black Market, you don't get salary, bonuses, retirement, benefits, and a nice corporate office.
Instead, you get a crappy grow house and the chance of getting shot or arrested.
Technically, no one can have "20 years of growing experience" - if they weren't doing it illegally.
My point is: The Big Cannabis Companies could be zapping the Black Market "Talent Pool".
If Mexico Legalizes for Recteational - Trump will need to seriously consider taking Cannabis off of Schedule 1.
I mean, our entire Northern and Southern Border Countries will be legal and you can't build a wall around the entire USA.
Plus, Trump ran Casinos. He's a realist. He's not a moral goodie-goodie.
If Trump REALLY wants to keep JOBS in the USA - now is his chance.
American Cannabis - Grown & Harvested 100% in America by hard working Americans!!! JOBS!! JOBS!! JOBS!!
Uh, you do realize that wasn't Aurora's Earnings Report that was released yesterday - right?
Just to make sure: Yesterday's ER was from a company called: CANOPY GROWTH.
Auroras ER was released a couple of days earlier and I suggest you read it.
"ACB does not have anywhere to go but up". Yeah Right. The Shorts love it when a bad company is temporarily lifted by a good company in the same sector. And there is more ATM Dilution coming.
If you loved Canopy's ER - then buy Canopy's Stock.
If you loved Aurora's ER - then buy Aurora's Stock.
But don't confuse the 2 Companies - they are NOT the same.
We know that Canopy was able to sell almost twice as much weed as Aurora did in the same Market and same timeframe.
So I would say that Aurora's Management owes their shareholders an in-depth analysis as to WHY.
And then after ACB's Management explains WHY Canopy is kicking their A@@es - It would also be nice to know what Aurora's Management is doing to correct the situation.
IMO - The latest Conference Call was way too short. They should have short calls when things are going great - and long, detailed calls when things are in the toilet. So this should have been a real long call...
I like it!
IMO. The Daily Special is a move in the right direction.
I keep saying that Cannabis is a lot like the Wine Industry - because it is.
You have your everyday Table Wines that you have with dinner and are reasonably priced so that regular people can afford them. And then you have you have "Special Occasion" Wine that is a treat but costs more.
So it is good to see that Aurora released a cost-effective brand for everyday use. Because the everyday users pay the bills and keep the lights on.
Plus, this Daily Special will help knock-out the Black Market!!!
According to this article - Canadians want Inexpensive, Strong, Cannabis.
https://www.msn.com/en-us/money/topstocks/people-want-cheap-weed-and-aurora-cannabis-is-paying-the-price/ar-BBZYLpj?li=BBnbfcN
And the good news is: VFF keeps their production costs super low - so if Consumers want inexpensive weed - VFF is there to satisfy that want.
Don't feel bad ACB Longs - Buffet is having a really bad few days also.
https://www.msn.com/en-us/money/topstocks/warren-buffett-just-lost-dollar1-billion-in-2-days-after-kraft-heinz-disappointed-again/ar-BB100wu3?li=BBnb7Kz
Losing $1 Billion in 2 Days must really suck. And this is on top of that $25 Billion he already lost.
Buffet clearly made a bad decision on Kraft/Heinz and when investors make bad decisions - it hurts.
It doesn't matter who you are.
I wrote some posts concerning STRAINS and QUALITY a while back.
In one sense, all of these large Cannabis Companies really need to employ some serious Stoners. Or at least LISTEN to what the Serious Stoners have to say about their flower.
They need the "Wine Connoisseurs" of Cannabis.
Success in the Cannabis Business is not about who can grow the most weed.
Instead, the Cannabis Companies are going to have to LISTEN to their Customers and provide them with the Strains they want - at a reasonable price.
I mean, if Aurora is growing "Big Bud" and the Cannabis Market want's "Girl Scout Cookies" then Aurora is going to be left with a lot of Cannabis they can't sell.
This is true of all the Cannabis Companies.
The Strain and Product Mix is going to be vital as this Market Matures.
It is exactly like the Wine Industry. Some wines are for everyday, some wines are for special occasions, etc...
If Aurora produces a great product - then why did they report $12 Million in returns a few days ago?
I mean, do people return great products?
Or maybe the $12 Million was all Price Discounts because Aurora had great weed - but they were trying to sell it for too much money?
I dunno the answer to this because they didn't give us much color on the $12 Million of returns.
Now that you mention it:
OCI - Wall Street Favorite - Profitable - Small Output, but their products are Award Winning.
VFF - In Business 30 Years, CEO is Founder 30 Years Ago, Chance of Dilution Very Low - Plus very low production costs (this is very important as Cannabis becomes Commoditized).
APHA - Great Balance Sheet and Tons of Cash.
And a few really small penny stocks that have their LICENSE (like MYMMF). These are a long shot - but they are growing weed - so they might grow something that Cannabis Connoisseurs love. Who knows. It's a bet.
Thanks!!
With Canopy's Pop this morning - I would expect a run-up in VFF's Shares going into the March 11th Earnings Report.
It was so great to see that Canopy's Revenues grew substantially in the latest quarter and BEAT Analyst's Estimates.
I was really concerned that ACB's downfall was due to the Overall Cannabis Market and not due to ACB's Management. But Canopy proved this to be incorrect today.
So the takeaway is: The demand for Cannabis is strong. And well run Cannabis Companies are good long term investments.
When is VFF's next Earning's Release?
IMO, VFF is a great Cannabis Stock.
I mean, VFF doesn't have nearly the drama that the other Cannabis Companies do:
- In business for 30 years.
- CEO that has great business sense.
- CEO is founder and owns tons of shares - no dilution happening.
- Very, Very low production costs (Low Production Cost is essential in a Commodity Business).
- Already turning a Profit.
- Presence in the USA growing CBD (if the USA ever goes legal - they can convert to THC efficiently).
Now that we know the Cannabis Market is strong (and that the sales declines are just an ACB Problem) - this will really help VFF.
I added a little bit of VFF to my portfolio this morning.
CGC's news is making the Cannabis Sector rise this morning, but it might cool down next week - that is when I'll buy more VFF shares.
I'm buying Cannabis Stocks also. Just not ACB.
There are just too many other great Cannabis Stocks out their selling at a deep discount right now.
I mean, there are much better Cannabis Bets than Aurora. I'm seeing a better risk/reward with the other Companies.
Yep. There is no doubt that Aurora's Financial Performance and Drama have weighed on the Cannabis Sector.
But what have we learned today?
We learned that the declining revenues are specific to Aurora and not the whole sector.
That is GREAT NEWS!!
The only way Aurora is going to turn their ship around is to start producing the BEST WEED in the World.
If you grow the best weed on the planet - then selling it will not be a problem.
But right now, it appears ACB has both a Quality and a Financial Problem. Not good.
Remember this with Aurora:
Red = Buy.
Green = SELL (This is the part the Long-Longs don't get).
I wrote a post about this a while ago.
In Colorado, they have Weekly Cannabis Flyers with COUPONS.
They also have Group-On like deals in Colorado.
And they have Every Ounce $100 Tuesdays.
So Aurora having a Daily Special is nothing new.
Once there are Cannabis Stores on every corner in Ontario - the REAL Competition begins...
Yep. I wrote a post about that a while ago.
The Cannabis Market is going to be extremely competitive when it comes to Price AND QUALITY.
People want the best weed they can get at the lowest price.
Before legalization - people just smoked whatever their guy had.
But now, people have choices, lots & lots of choices.
That is why Companies need to compete and win competitions like the Cannabis Cup. It is exactly like Wine Competitions.
For Example: OGI won 4 Categories in one of the competitions - so people know their weed is top notch.
So it's not a matter of HOW MUCH weed you can grow.
It is a matter of HOW GOOD is your weed.
And this is exactly how it should be...
Yep. A short squeeze in ACB could happen...
The problem is: ACB keeps issuing shares ATM. So the shorts have an easy way out because of the ATM Shares.