Aphria (NASDAQ:APHA) saw a pleasant bump in stock price at the end of the week following a recommendation upgrade from a top analyst who follows the company. On Thursday, Bank of America (NYSE:BAC) prognosticator Christopher Carey upped his view on the company to buy from the previous neutral.
This was due, Carey wrote in a research note, to factors such as the cannabis company's relatively large cash position and its recent success in growing market share. The Bank of America analyst also cited Aphria's "defensiveness" as an investment, thanks to its strong involvement in the higher-margin medical cannabis segment.
Despite the bullishness, though, Carey didn't think highly enough of Aphria to maintain his former price target on the stock. He lowered it to $3.44 per share from the former $6.13 -- although it must be said the new level is nearly 40% higher than the company's latest closing stock price.
The ray of optimism from the Bank of America report is a welcome change for a sector that's been hit particularly hard by the sell-off of equities in the wake of the SARS-CoV-2 coronavirus outbreak. Already teetering because of disappointing results and habitual bottom-line losses among other factors, numerous marijuana stocks have fallen more steeply than the major market indexes. Aphria has declined by over 51% so far this year.
Aprhia's stock ended the week on a high after the Bank of America research note made the rounds. On Friday, the shares increased by over 6% on a down day for the broader stock market.