No. 2. Runner-up. Second fiddle. All these terms have applied to Aurora Cannabis (NYSE:ACB) over the past couple of years. Even as the Canadian marijuana producer made one acquisition after another to fuel growth, it seemed to still always trail behind one other company. That company, of course, is Canopy Growth (NYSE:CGC).

But Aurora has stepped into the limelight more than ever in 2019. Its stock has outperformed all of its peers -- including Canopy Growth -- so far this year. Cowen analyst Vivien Azer replaced Canopy Growth with Aurora as her top pick among marijuana stocks

There's a strong argument to be made that Aurora Cannabis is now a better pot stock than Canopy Growth. Here are three reasons that's the case, along with one big reason Aurora still doesn't beat Canopy.

Pile of marijuana leaves with one marijuana leaf centered on the top of the pile

Image source: Getty Images.

1. Lower valuation

Aurora isn't close to dethroning Canopy Growth when it comes to which company has the highest market cap. But that's also perhaps the best reason why Aurora should be viewed as the better pot stock right now.

In the quarter ended Dec. 31, Aurora reported net revenue of $54.2 million Canadian, compared with Canopy's CA$83 million. On a percentage basis, Aurora's revenue was 35% lower than Canopy Growth's revenue. However, Aurora's market cap of around $9 billion is nearly 44% lower than Canopy's market cap of $16 billion. 

Granted, both Aurora and Canopy look ridiculously expensive compared to their historical sales. But both companies also should enjoy strong sales growth in the future. Aurora's lower market cap arguably gives it more room to run. 

2. Greater production capacity

Vivien Azer's top reason for making Aurora her top marijuana stock pick is the company's production capacity. The reality is that capacity is king in a market where demand outstrips supply. 

Aurora has built up the most impressive production capacity in the industry. The company is already running at an annualized production rate of 120,000 kilograms of cannabis. By the middle of next year, Aurora's annual production capacity will jump to more than 625,000 kilograms.

Canopy Growth is no slouch when it comes to production capacity. It already has 4.3 million square feet of licensed growing space with another 1.3 million square feet on the way. That's enough to make Canopy a close second to Aurora in capacity -- but not ahead of its rival.

3. Stronger international presence

There's also another area where Aurora Cannabis ranks No. 1 in addition to production capacity. The company is the leader in international medical cannabis markets.

In the last quarter, Aurora narrowly edged Canopy Growth for the highest international medical cannabis sales. Aurora is also active in more countries than Canopy is. The company has operations in 24 countries compared to 14 for Canopy Growth.

Seventy-nine companies vied to win approval from Germany to cultivate medical cannabis in the country. Only three of those companies were picked for the distinction. Aurora was one of the three; Canopy Growth wasn't. This could give Aurora a competitive advantage in the important German medical cannabis market -- the biggest marijuana market outside North America.

But here's why Canopy Growth is still better

With a lower valuation, greater production capacity, and stronger international presence, you might think that Aurora would be a shoo-in over Canopy Growth. But it isn't. There's one big reason why Canopy Growth is arguably still the better marijuana stock for long-term investors: Canopy has a major partner, alcoholic beverage maker Constellation Brands (NYSE: STZ), and all the benefits that come with that relationship.

The market for cannabis edibles and beverages is expected to open in Canada later this year. Canopy's partnership with Constellation could give it a significant leg up over Aurora in this market.

Canopy Growth is flush with cash after Constellation invested $4 billion in the company last year. This cash stockpile has allowed Canopy to expand into the U.S. hemp market and buy the rights to acquire U.S. cannabis operator Acreage Holdings. Aurora hasn't moved into the huge U.S. market at all yet.

Aurora also must still rely on raising capital through bought deal financing transactions. The company announced earlier this month that it had filed a preliminary base shelf prospectus in Canada and a corresponding shelf registration statement in the U.S. to raise up to US$750 million by issuing new securities. That means more dilution in the value of existing shares is probably on the way. Canopy Growth, on the other hand, doesn't have to worry about raising capital thanks to its Constellation deal. 

Sure, Aurora is hunting for one or more partners outside the cannabis industry. It even signed up billionaire investor Nelson Peltz as a strategic advisor to use his connections to help find partners. But there's no guarantee that this effort will be successful. Even if Aurora does find a partner, it might not involve a sizable equity investment like Canopy received from Constellation. 

There are definitely several reasons to like Aurora Cannabis' prospects. But, for now at least, I think the company remains a runner-up to Canopy Growth.