Looking into the current session, Aurora Cannabis Inc. ACB shares are trading at $15.28, after a 40% spike. Moreover, over the past month, the stock spiked by 76.97%, but in the past year, decreased by 85.28%. Shareholders might be interested in knowing whether the stock is undervalued, even if the company is performing up to par in the current session.

The stock is currently above from its 52 week low by 2447.27%. Assuming that all other factors are held constant, this could present itself as an opportunity for investors trying to diversify their portfolio with Drug Manufacturers—Specialty & Generic stocks, and capitalize on the lower share price observed over the year.

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The P/E ratio is used by long-term shareholders to assess the company’s market performance against aggregate market data, historical earnings, and the industry at large. A lower P/E indicates that shareholders do not expect the stock to perform better in the future, and that the company is probably undervalued. It shows that shareholders are less than willing to pay a high share price, because they do not expect the company to exhibit growth, in terms of future earnings.

Depending on the particular phase of a business cycle, some industries will perform better than others.

Aurora Cannabis has a lower P/E than the aggregate P/E of 32.85 of the specialty & generic drug manufacturers industry. Ideally, one might believe that they might perform worse than its peers, but it’s also probable that the stock is undervalued.

price to earnings ratio is not always a great indicator of the company's performance. Depending on the earnings makeup of a company, investors may not be able to attain key insights from trailing earnings.