What happened

Shares of Aurora Cannabis (NYSE:ACB) surged 59% last month, according to data provided by S&P Global Market Intelligence. The marijuana producer delivered better-than-expected third-quarter results and entered a major new market.

So what

Aurora's shares rocketed higher on May 15, following the release of its fiscal third-quarter financial report. Its net revenue, excluding provisions, jumped 18% sequentially to CA$78.4 million, driven by strong growth in recreational and medical cannabis sales. That was well above the CA$66.7 analysts expected. The news is believed to have ignited a short squeeze; many short sellers who bet against Aurora's stock were likely forced to buy shares in order to close their positions, thereby helping to drive the price higher.

A rising stock chart superimposed on some cannabis plants.

Aurora Cannabis stock rose sharply in May. Image source: Getty Images.

The gains continued later in the month when Aurora struck a deal to enter the potentially massive U.S. cannabidiol (CBD) market. On May 20, the cannabis leader announced it would acquire Reliva, a top-selling CBD brand. Aurora said the deal would help to improve its profitability shortly after its expected closing in June, and investors cheered the news.

Now what 

Despite its strong recent performance, Aurora Cannabis remains a high-risk stock. It's still unprofitable, and due to its dwindling cash reserves, Aurora will likely need to further dilute shareholders by selling more shares.

However, should it be able to achieve profitability sooner than expected, Aurora's positioning within the rapidly growing global cannabis market could make it an intriguing long-term investment.