Please ensure Javascript is enabled for purposes of website accessibility

Why Aphria Stock Jumped Today

By Prosper Junior Bakiny – May 15, 2020 at 5:49PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Aphria is benefiting from Aurora Cannabis's most recent earnings report.

What happened?

Aphria (APHA) ended the week on a strong note. Shares of the Ontario-based cannabis company climbed by 11.3% on Friday, despite the company not reporting any news.

The catalyst for Aphria's stock rising today seems to be the better-than-expected financial results Aurora Cannabis (ACB -1.64%) -- one of Aphria's peers in the marijuana industry -- reported after the market closed on Thursday. Aphria is simply riding the positive wave started by its competitor. 

So what

There was little hope that Aurora Cannabis would be able to deliver strong financial results, especially after Tilray (TLRY) -- another big player in the marijuana industry -- disappointed with its own earnings report. However, Aurora Cannabis's net revenue of CA$78.4 million (excluding provisions of 2.9 million Canadian dollars) came in higher than the 66.7 million Canadian dollars analysts were expecting.

The cannabis company's total net revenue also increased by 35% sequentially. These results -- which are especially noteworthy considering the ongoing crisis -- may have helped investors regain a little trust in the cannabis industry, which has been profoundly disappointing over the past year or so. 

Red Canadian maple leaf symbol surrounded by cannabis leaves.

Image source: Getty Images.

Now what

For its part, Aphria has consistently delivered strong financial results of late, especially when compared to its peers in the cannabis industry. For instance, in its most recent quarterly update, the company recorded a net revenue of 144.4 million Canadian dollars, a 19.8% sequential increase. Even with its gains on the market today, though, Aphria's stock is still down by more than 30% year to date. This presents a decent buying opportunity for investors looking to buy shares of this cannabis company

Prosper Junior Bakiny owns shares of Aurora Cannabis Inc. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Aphria Stock Quote
Aphria
APHA
Aurora Cannabis Stock Quote
Aurora Cannabis
ACB
$1.20 (-1.64%) $0.02
Tilray Stock Quote
Tilray
TLRY

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
329%
 
S&P 500 Returns
106%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 09/26/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.