Thank you for asking for my analysis of the latest green day.
Here it is:
The numbers do not add-up for Aurora. Aurora is planning on producing 500,000 Kilos of product (which is 17.7 million ounces of weed annually). However, there are only 20 million men, women, and children in Canada. So basically, Aurora alone can supply the whole country with an ounce of weed each. When you take into the other growers (like Canopy), Canada is going to have a Cannabis oversupply.
Plus, I watch the videos of Aurora's production facility. Cam is very proud of the automation, overhead cranes, and state of the art ceiling. However, all of those "toys" cost money. The low cost producers are eventually going to be the ones that grow outdoors and with far less overhead.
As such, with everything we know right now. I believe ACB's Market Cap is high.
However, if you are owning ACB, there are some "Game Changers" that you are hoping and praying for. They are:
1) US Federal Legalization - This will eventually happen. However, I don't see Trump taking Cannabis off of Schedule 1. And when it does happen, the President that signs it will not allow Canadian Cannabis into the USA without substantial tarriffs. Or a treaty where the US Cannabis Companies can sell into Canada. Either way, Aurora is going to have a tough time in the US Market.
2) A Big Deal - The "Big Deal" worked for CRON's and Canopy's Share Price - so logically, it would help Aurora's. So if you are holding on, you should be hoping for a Big Deal coming.
Personally, I think the shorts are selling into these 2 days of green and I am also selling some shares. There is nothing wrong with making $$$$.
