In case you haven't noticed or have been otherwise living under a rock, big things are happening with the marijuana industry. In less than four weeks, roughly nine decades of Canadian recreational marijuana prohibition will be wiped away as it becomes the first industrialized country in the world to legalize adult-use weed. And with this legalization comes the potential for the industry to generate billions in added annual sales. This is what's been behind the astronomical rally in pot stocks in recent years.

Brand-name pot stocks angle for U.S. listing

But what you might find interesting is that not everyone has been able to participate in the cannabis rally -- even if they've wanted to. Because federal scheduling is so restrictive in the United States, publicly traded investment opportunities tend to be few and far between. And let's face it, those pot stocks that are based in the U.S. aren't all that appealing.

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The bigger issue is that U.S. investors might not have access to stocks that trade on global exchanges, such as in Canada. I bring this up because with Canada legalizing recreational marijuana, it's Canadian pot stocks that have been soaring. If U.S. investors want to participate in the "canna-rally," they've had to turn to buying over-the-counter (OTC) exchange-equivalent stocks. Put plainly, not all institutional investors, or retail investors for that matter, are able to purchase OTC stocks. That restricts the potential ownership of marijuana stocks.

The solution? Since February, Canadian marijuana stocks have turned to more reputable U.S. exchanges for uplisting. Cronos Group (CRON 1.26%) beat every other pot stock to the punch when, in late February, it moved from the OTC exchange to the Nasdaq (NDAQ 0.80%). In May, Canopy Growth Corp. (CGC 0.31%) followed suit by making the move to the iconic New York Stock Exchange (NYSE). And in July, Canadian cannabis grower Tilray (TLRY) became the first marijuana stock to go the initial public offering route on a U.S. exchange (the Nasdaq).

The reason Cronos Group, Canopy Growth, and Tilray chose reputable U.S. exchanges is simple: the potential for added institutional investment over what they could receive while listed on the OTC exchange. Needless to say, their decisions have paid off handsomely. Cronos Group and Canopy Growth Corp. have both roughly doubled since debuting on their respective exchanges earlier this year, while shares of Tilray have skyrocketed more than 1,150% since its initial public offering!

Now it looks as if a fourth brand-name marijuana stock is ready to make the switch.

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The largest weed producer is ready to list its shares on a reputable U.S. exchange

In an interview with the Financial Post on Tuesday, Cam Battley, the chief corporate officer for Aurora Cannabis (ACB -1.80%), said that the company is aiming to uplist to a major U.S. exchange in October. Such a move would expand the company's investor base, "including U.S. institutional investors, not all of whom are able to trade in OTC-listed securities," said Battley. 

Should this surprise anyone? Well, not really. If you've been keeping tabs on Aurora Cannabis for some time, you might recall that in early March, CEO Terry Booth sat down with the Financial Post and told the publication that the company was looking at a possible listing on the Nasdaq, NYSE, or the AIM, which is a division of the London Stock Exchange. 

Uplisting in October would obviously make a lot of sense given the euphoria surrounding legalization on Oct. 17. It would offer the perfect opportunity to attract investors who fear missing out to get into pot stocks before the green flag officially waves.

However, Aurora Cannabis likely also seeks the validation of a reputable exchange listing, especially since it's on track to be the nation's top pot producer by yield. Following multiple organic-build projects, a partnership with Alfred Pedersen & Son in Denmark, and two mammoth acquisitions, management expects to yield 570,000 kilograms per year. Once its latest purchase is accounted for (ICC Labs), there's an outside chance it could even hit 700,000 kilograms a year in production when at full capacity. As the clear quantity leader, it only makes sense to uplist to a reputable exchange and give institutional investors easier access to the stock.

A cannabis leaf lying atop a hundred-dollar bill that's partially obscuring Ben Franklin's face, save for his eyes.

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Uplisting might have a surprisingly negative effect on Aurora's stock

Then again, I'm not entirely convinced that Aurora Cannabis won't shoot itself in the foot over the short to intermediate term with such a move.

You see, Aurora Cannabis's claim to fame -- its superior production potential -- is all a result of its aggressive acquisition, partnership, and organic construction strategy. This plan wasn't cheap, and it required the company to turn to bought-deal offerings on a number of occasions.

A bought-deal offering is when common stock, convertible debentures, stock options, and/or warrants are sold to an investor or group of investors in order to raise capital. While successful in raising the money it needed to boost its production capacity, these bought-deal offerings will also balloon the company's outstanding share count, making it that much harder for Aurora Cannabis to produce a meaningful per-share profit. Having ended fiscal 2014 with around 16 million outstanding shares, the company will likely have around 1 billion shares outstanding by the end of its current fiscal year.

Uplisting to the Nasdaq or NYSE would presumably allow financial institutions and retail investors easier access to bet against Aurora Cannabis' stock via short selling or through put options. After all, a triple-digit forward P/E might not be what institutions are looking for.

Regardless of which side Wall Street eventually takes with Aurora Cannabis, the red carpet appears to be out for its arrival on a reputable U.S. exchange sometime next month.