What happened?
Shares of Aurora Cannabis (ACB 1.99%) are down by 9.4% as of 3:12 p.m. EDT on Wednesday, despite the company not reporting any news. But with a grim economic outlook and the pot grower unlikely to wow investors with its fiscal third-quarter financial results, it isn't surprising that Aurora Cannabis's shares are falling.
So what
Speaking about the prospects of an economic recovery, Jerome Powell, head of the U.S. Federal Reserve, said the following: "It will take some time to get back to where we were." Even as states begin to ease social distancing rules, these comments from the head of the Federal Reserve are bound to scare investors, especially those who hold shares of Aurora Cannabis.
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The company is set to release its financial results for the third quarter of its fiscal year 2020 on Thursday, and with Tilray (TLRY +0.00%) recently reporting mixed results, it's hard to imagine Aurora Cannabis doing much better, especially given recent history. To make matters worse, Aurora recently conducted a reverse stock split to boost its stock price, much to the dismay of shareholders, each of whom received one share for every 12 owned.
Now what
At writing, Aurora Cannabis's shares are down by more than 20% since this week started. However, the company could get back in the good graces of investors if it manages a slam dunk when it announces its third-quarter financial results. But if Aurora Cannabis flops again, its stock could hit a brand new bottom. Either way, it will be interesting to see what happens when the cannabis company releases its earnings report after the market closes tomorrow.
