Cannabis giant Aurora Cannabis (NASDAQ:ACB) hasn't announced a date for its fourth-quarter earnings release just yet, but it will likely arrive in September, as it did last year. It'll be an important finish to what's been a challenging year for the Alberta, Canada-based cannabis producer, which continues to incur operating losses every quarter while struggling to generate consistent sales growth. It'll also be an important segue into fiscal 2021, and a chance for investors to see whether the company is making improvements and strengthening its financials.

In just the past year, Aurora's shares are down more than 85%; the Horizons Marijuana Life Sciences ETF (OTC:HMLSF) is down just 57%, which is still far below the S&P 500's positive 15% returns during the same period. For the stock to turn its fortunes around, investors are going to need to see some significant improvements. Here are four items to keep an eye on when the company releases its upcoming results:

1. EBITDA

All eyes will be on Aurora's earnings before interest, taxes, depreciation, and amortization (EBITDA) number when the company reports earnings. That's because management has projected that by the first quarter of fiscal 2021, its adjusted EBITDA will be positive. As recently as June 23, Aurora assured investors it was still on track to reach that goal.

It will be an important milestone for the company, one that could help signify stability in the business once and for all. In its third-quarter results, released May 14 for the period ending March 31, Aurora reported an adjusted EBITDA loss of 50.9 million Canadian dollars. And while that was an improvement from its second-quarter loss of CA$80.2 million, it was worse than what it reported in the same period last year, when Aurora's adjusted EBITDA was negative CA$36.6 million.

Stack of cash with marijuana leaves.

Image source: Getty Images.

EBITDA is an important number that can track a company's performance better than typical accounting income, which includes non-cash items like depreciation and amortization that can weigh down results and paint a much worse financial picture overall.

2. Sales growth

The next number investors should focus on is sales. A big problem for Aurora is that the company's top line hasn't always been consistent. In the third quarter, sales of CA$75.5 million represented a 35% increase over a soft second-quarter performance that was weighed down by revenue provisions, returns, and adjustments totaling CA$10.6 million. The growth simply brought the company back to where it was a couple of quarters ago, when it reported net revenue of CA$75.2 million. In essence, Aurora has shown little to no growth over the past couple of quarters -- and while making progress toward positive EBITDA is important, sales growth is what gets cannabis investors excited. It could be hard to convince investors to buy shares of the company without stronger sales numbers. 

3. Margins

When reviewing Aurora's financials, investors shouldn't overlook gross margins. To have a realistic shot at a positive EBITDA number, the company's gross margins need to be strong. But the concern is that many cannabis companies in Canada are being more aggressive on price in an effort to squeeze out the black market and gain more market share. And while that may help sales growth, it could negatively affect gross margins, leaving less money to cover overhead and other operating expenses.

In Q3, Aurora's gross margin before fair-value adjustments was 42.2% of net revenue, down from a gross margin of 55.6% in the prior-year period. A focus on pushing its new value brand, Daily Special, could help generate sales growth, but it could also bring the company's margins down. And that could be a telltale sign that Aurora's financials may not be improving, even if its sales numbers are getting stronger.

4. Cash burn

How much money Aurora's burning through is another important consideration. Earlier this year, investment bank Ello Capital estimated the cannabis producer only had a few months of liquidity left. And while the company's still around, so too are questions surrounding its sustainability. In Q3, Aurora used CA$58.7 million to fund its operating activities, slightly up from CA$54.7 million during the same period a year ago. But for the trailing nine months, it spent CA$288.3 million on its day-to-day operations, compared with CA$187.6 million a year ago.

Aurora needs to improve its rate of cash burn -- and ideally be generating positive cash flow from its operations -- to help minimize investor concerns about the business' long-term viability. 

There's no single number investors should focus on

It may be tempting to say that Aurora's sales were up, or it made progress on EBITDA, so the company's headed in the right direction. But the truth is that investors need to look at all four of the items listed above, as together they'll provide a complete picture of how the business is doing. Sales growth means little if the margins are getting smaller, which, in turn, will impact EBITDA. And even if the first three items on this list look great, it could all be for naught if Aurora's burning through more cash and in danger of running out of money.

Right now, there are many question marks surrounding Aurora's future and how competitive it will be. And without good numbers across all four of the items listed above, I wouldn't consider investing in the pot stock, regardless of how good any one particular number looks.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.