Is $18 Aphria Stock Still a Bargain?

AphriaAphria Inc. (NASDAQ: APHA) is one of the most popular cannabis stocks on the market today. The chart in recent months shows mostly sustained growth, which could continue in the coming months. The stock, which traded at just over $18 when the markets closed yesterday, could still be considered a bargain. There are good reasons for investors to consider buying shares in March.

Aphria produces and distributes adult-use and medical cannabis in the Canadian market. Although the company faced a challenging 2020 due to lockdown restrictions and reduced consumer spending, it still produced some surprises. In January, the company reported quarterly revenue of $160.5 million, beating the consensus estimate of $153.75 million. Most notable was the fact that revenue was up 33% year over year, confirming that there is still huge growth potential in the legal cannabis market.

This stock should be seen as a long-term pick with an interesting advantage. Aphria is preparing a reverse merger with Tilray Inc. (NASDAQ: TLRY), which will create the largest legal cannabis production and distribution company. Aphria shares will be converted to Tilray shares at a rate of 0.83 per share when the merger is completed, which is expected later this year. The massive market penetration and reduction in operating costs created by the consolidated merger will likely generate a strong upside for investors in the long term.

This pick carries risk and it’s pricier than typical bargain options. However, for the potential to own a piece of the largest legal cannabis company in the world, this is still one of the best pot stocks available.

Key Data:

  • 1 Year Price Growth: 81%
  • YTD Price Growth: 10%
  • 3 Month Price Growth: 48%

All information is based on current and historical market data, as well as publicly available financial data. As with any financial decision, your own research is important. Stock market outcomes can never be 100% accurately predicted. Familiarity with historical data, individual industries, and individual stocks is key to developing a robust portfolio. Note that stock prices can fluctuate rapidly during trading sessions.

 

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