2022 Is A Make Or Break Year For Aurora Cannabis Inc.
In 2021, the price of Aurora Cannabis’ stock dropped more than 35%
Next month, Aurora Cannabis Inc. (TSX: ACB) (Nasdaq: ACB) will release fourth quarter financial results and we expect the market to be highly focused on the numbers that are reported and any forward looking guidance from the management team.
In the prior quarter, the Canadian Licensed Producer reported positive earnings per share (EPS) which surprised us. The positive EPS in the third quarter follows a few quarters of Aurora Cannabis recording negative EPS that also came in lower than what analysts expected.
We believe 2022 is a make or break year for Aurora Cannabis and expect its success or failure to be determined by the following seven factors:
- Federal Legalization in the US – The management team has experience in the US cannabidiol (CBD) market. Aurora Cannabis expects the US to be a primary growth driver once cannabis is legalized or decriminalized at the federal level. We have been highly focused on the advancement of pro-cannabis legislation and will be closely following the trend in 2022
- Effective Cash Management – Aurora Cannabis was previously well-known for having a war chest of cash to grow the business. The company’s balance sheet is not nearly as strong as it used to be and we will monitor how the remaining resources are used to efficiently grow the business
- Reporting Lower Amounts of Revenue per Quarter – In 2021, Aurora Cannabis’ fundamentals weakened and this is a trend we are highly focused on. Last year, the company reported a decline in the amount of quarterly revenue that generated and this is a metric we are highly focused on. Going forward, we will be curious to see how much revenue is generated in Canada or abroad. We are also focused on the verticals that will generate the most revenue for the business and believe our readers should follow this trend
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