Aphria stock jumps 10%, analyst dubs the pot company ‘belle of the ball’
(Aphria / YouTube)
Shares in Canadian cannabis producer Aphria (APHA.TO) (APHA) rose more than 10 percent on Thursday, extending the week's earnings as analysts praise the company ahead of its quarterly earnings release next week.
Toronto-listed stocks hit $ 7.56 in early trading, their highest level since rising in late July. The Leamington, Ontario-based company’s momentum comes from analysts from CIBC and Cantor Fitzgerald pointing to market share gains in Canada over the past year and promising international exports.
Aphria shares will be traded on the Toronto Stock Exchange on Thursday, October 8, 2020.
Aphria stocks are up more than 60 percent in the past six months, well outperforming the Horizons Marijuana Life Sciences Index ETF (HMMJ.TO) and the world's most valuable pot company Canopy Growth (WEED.TO) (CGC) during that period about nine percent and one percent, respectively.
"In a consolidating Canadian industry, we continue to consider Aphria to be the" beauty of the ball, "" Cantor Fitzgerald's Pablo Zuanic wrote earlier this week in a statement to customers highlighting the company's leading position in the Canadian leisure market. "We expect Aphria shares to rebound when the company releases its quarterly results for August."
CIBC analyst John Zamparo reiterated that assessment Thursday, calling Aphria "the clear market share leader nationally and in key provinces like Ontario, where retail sales growth should outstrip the rest of the country due to under-penetration from [cannabis] stores." "a note to customers.
Aphria announced on Wednesday the completion of its first shipment of EU GMP certified cannabis to its German subsidiary CC Pharma. In August, it announced a strategic supply agreement with Israeli medical cannabis producer Canndoc.
The company said it was strategically positioned in the two largest cannabis markets outside Canada, with the U.S. fragmented into state-level markets. Zuanic expects Aphria to begin reporting international cannabis revenues as early as the first half of fiscal 2021.
Aphria is expected to release its financial results for the first quarter of fiscal 2021 on October 15.
Zamparo claims sales of 155 million US dollars, two percent more than in the previous quarter. He expects net sales of $ 60 million, an increase of 14 percent from the previous quarter. The stock exceeded its target price of $ 7.50 on Thursday. Zuanic has a more bullish price target of $ 15.50.
Jeff Lagerquist is a Senior Reporter at Yahoo Finance Canada. Follow him on Twitter @jefflagerquist.
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