Based on recent momentum, Aphria (NASDAQOTH: APHQF) would lose to Organigram Holdings (NASDAQ:OGI) in a battle between the two marijuana stocks. Aphria's share price has dropped more than 30% so far in 2018, while Organigram stock is up nearly 15%.

But picking a stock based only on recent momentum isn't a great idea. Past performance doesn't necessarily translate to future success. Which of these two marijuana stocks is the better choice for investors over the long run? Here's how Aphria and Organigram compare.

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The case for Aphria

It's important to first understand why Aphria's stock performance has suffered so far this year. In January, Aphria announced that it would acquire Nuuvera in exchange for a combination of cash and Aphria stock. In connection with this deal, Aphria issued new shares, with the resulting dilution causing much of the decline for its stock price.

But Aphria's business is better than ever. The company posted record revenue when it announced its fiscal year 2018 third-quarter results in April. Aphria's sales more than doubled the prior-year period total and jumped 20% from the previous sequential quarter.

The company's acquisitions of Nuuvera and Broken Coast Cannabis earlier this year position Aphria as a major player in two key growth markets. One is the anticipated recreational marijuana market in Canada. The Canadian Senate is scheduled to vote on legalizing recreational marijuana for adult use on June 7, 2018. If this legislation passes as expected, Aphria and its peers will compete in a multibillion-dollar market.

However, there's an even larger potential market where Aphria could succeed. At least 22 countries have active medical marijuana laws. The international medical marijuana market could be eight times larger than Canada's marijuana market over the next few years. Aphria's Nuuvera acquisition gives the company a foothold in several international markets, especially Germany.

Aphria is cranking up production capacity in anticipation of tremendous growth from the domestic and international markets. The company is expanding its Aphria One facility by 700,000 square feet and retrofitting its 1.3-million-square-foot Aphria Diamond facility. Recent acquisitions give Aphria even more capacity. In total, Aphria could claim annual production capacity of around 225,000 kilograms by early 2019. 

The case for Organigram

Organigram hasn't been active in the business development scene like Aphria, but the marijuana grower's business is definitely booming. In its Q2 results announced in April, Organigram reported record-high sales and posted a profit -- something that many marijuana growers haven't done.

The growth opportunities for Organigram are the same as for Aphria. In anticipation of the legalization of recreational marijuana in Canada, Organigram recently unveiled a suite of adult recreational cannabis brands. The company is preparing to launch The Edison Cannabis Company, ANKR Organics, and Trailer Park Buds brands of recreational marijuana. 

Until earlier this month, Organigram didn't have exposure to international marijuana markets. However, the company announced its first international investment on May 8. Organigram entered into an agreement to buy up to 25% of alpha-cannabis Pharma GmbH, also known as Alpha-Cannabis Germany (ACG). ACG was founded in 2016 to serve the German medical cannabis market as well as other European markets. 

But what about production capacity to meet the demand for recreational marijuana in Canada and medical marijuana across the world? Organigram can produce around 36,000 kilograms of cannabis per year with the completion of its phase 3 expansion at its New Brunswick facility. Additional expansions are planned, though, that will boost the company's annual production capacity to 113,000 kilograms by April 2020. 

The better marijuana stock

Aphria is certainly in a better position right now to capitalize on the anticipated surge in demand once recreational marijuana is legalized in Canada. The company also has a head start over Organigram in international markets. My initial instinct is to pick Aphria as the better marijuana stock.

However, it's important to also look at bang for the buck. My colleague Sean Williams has referred to Organigram as "the only marijuana value stock." Sean's designation was a relative one, of course, since most marijuana stocks currently have sky-high valuations. But he's definitely on to something.

Aphria's market cap currently stands at close to $2 billion, more than four times Organigram's market cap of $450 million. Aphria's projected annual production capacity of 225,000 kilograms, though, is only around twice the size of Organigram's projected capacity of 113,000 kilograms per year. Organigram is the better bargain when it comes to the production capacity you get for your investment.

Because of this significant advantage in valuation, I think the nod goes to Organigram as the better marijuana stock. However, my view is that both of these stocks can be winners over the long run. I also suspect that both could find themselves acquisition targets for larger players down the road.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. 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.