Two of Canada’s major pot stocks released earnings this week. While attention has shifted away from cannabis investments during the COVID-19 pandemic, these stocks are still major plays this year.
Here are three pot stock earnings quotes that you should know.
Aurora Cannabis: A reasonably priced pot stock
Aurora Cannabis (TSX:ACB)(NYSE:ACB) was down-trending from a 52-week high of $60.24 before the March 2020 sell-off. Prior to its November 9 earnings announcement, the share price hit a 52-week low of $4.93. However, the stock quickly rebounded on better-than-expected results.
The stock was selling for nearly $17 per share on Monday morning. As of Tuesday, the price of Aurora Cannabis stock is $11.95 per share on news of the company selling additional shares. The price-to-sales ratio is 6.77.
Aurora Cannabis sells medical cannabis products globally. Some of the firm’s products include cannabis oil, capsules, vaporizers, edibles, and medical topical kits.
Aurora Cannabis has taken a lot of heat for its balance sheet from investors. Nevertheless, it is still one of the top pot stocks to buy this year. If you don’t own Aurora Cannabis yet, now may be a good time to think about buying shares of this stock.
Miguel Martin, CEO of Aurora Cannabis, had this to say about the first quarter 2021 results:
“We continue to take the necessary steps to execute our plan and transform our business to achieve sustainable profitability, and ultimately positive cash flow. Our Q1 2021 results are transitional but do highlight successes across a number of diverse profit pools. We remain the leader by revenue in the high-margin Canadian medical market, our international medical business experienced more than 40% net revenue growth this quarter, and our CBD brand Reliva is #1 ranked by Nielsen in the U.S. CBD sector.”
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Canopy Growth: A popular cannabis investment
Canopy Growth (TSX:WEED)(NYSE:CGC) stock has been volatile this year. Nevertheless, the stock price has performed quite well overall. The price has increased from a 52-week low of $12.96 to a 52-week high of $34.80.
Canopy Growth stock also saw a boost in value after its earnings results. At the time of writing, investors are trading the stock for $31.42 per share. The price-to-sales ratio is now 24.66.
Canopy Growth also produces and distributes cannabis around the globe. In addition to medical marijuana, Canopy Growth serves the recreational market with hemp, dried cannabis, oils, and soft gel capsules.
Looking at its price-to-sales ratio, this is a more expensive pot stock to buy this year. It is still a good cannabis investment, but shareholders have already priced in a lot of its future growth. Investors looking for value might prefer Aurora or HEXO to Canopy Growth stock.
Mike Lee, CFO of Canopy Growth, had this to say about the firm’s second-quarter fiscal 2021 financial results:
“We saw another quarter of improvement in our operating expense ratio while our marketing and R&D investments are being re-directed to drive sales. Importantly, our end-to-end review has identified cost savings opportunities in the range of $150-$200 million . . . and efforts are underway to quickly capture value. Leveraging ongoing improvements across our business, we are accelerating our path to profitability, notably in our largest market, Canada.”
HEXO: A cheap marijuana stock to buy
Like Aurora, HEXO (TSX:HEXO)(NYSE:HEXO) stock was also down-trending prior to March from a November 2019 high of $3.58. During the sell-off, the price of the stock fell to $0.5000. On Tuesday, investors are trading the stock for $1.03 per share.
HEXO boasts dried cannabis, powder, oil, and beverage brands such as Time of Day, Elixir, Decarb, and Little Victory.
Hexo reported its fourth-quarter fiscal year 2020 financial results on October 29. Sebastien St-Louis, CEO of HEXO, commented on the firm’s growth in its earnings press release:
“HEXO’s topline growth this quarter reflects the ongoing performance and success of our 2.0 products and the high quality of our offering which repeatedly resonates with consumers. We are commanding significant market share in Quebec and this year we made major strides by launching Truss cannabis infused beverages in Canada in addition to our initial foray into the U.S. with Molson Coors, a world-class partner.”
Similar to Aurora, HEXO is less expensive than Canopy Growth with a price-to-sales ratio of 6.22. If you are looking for a cheap pot stock to buy this year, HEXO is a good buy.
This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.
Fool contributor Debra Ray has no position in any of the stocks mentioned. The Motley Fool recommends HEXO. and HEXO.