Market Overview

Here's How Much Investing $100 In The 2018 Debut Of Aurora Cannabis Would Be Worth Today

Here's How Much Investing $100 In The 2018 Debut Of Aurora Cannabis Would Be Worth Today

Investors who owned stocks since October 2018 generally experienced some big gains. In fact, the SPDR S&P 500 (NYSE: SPY) total return in that time is roughly 27%. But there’s no question some big-name stocks have done much better than others in that stretch.

Aurora’s Bumpy Ride

Unfortunately, one stock that has struggled mightily since October 2018 is Canadian cannabis producer Aurora Cannabis Inc (NYSE: ACB).

Aurora began trading on the NYSE on Oct. 23, 2018. The listing wasn’t technically an IPO because the stock had traded on the Toronto Stock Exchange and over-the-counter in the U.S. for years. On its first day of non-OTC U.S. trading, Aurora opened at $7.51 and traded as high as $8.63 and as low as $7.01 before closing the day at $7.70, up 2.5%.

Aurora followed in the footsteps of Canadian-listed cannabis companies Canopy Growth Corp (NYSE: CGC), Cronos Group Inc (NASDAQ: CRON) and Tilray Inc (NASDAQ: TLRY), all of which had previously listed their shares in the U.S. earlier that year. Up to that point, those Canadian cannabis stocks had performed extremely well. However, Aurora was slammed is its first few weeks on the U.S. market.

From its opening price of $7.51, Aurora shares initially dropped as low as $4.58 by December 2018 and finished 2018 down 42.9% from its U.S. listing price.

Aurora seemed to find its stride in the first quarter of 2019, reached an all-time U.S. high of $10.32 in March before falling back below $7.50 by June. By October, mounting losses and slower-than-expected Canadian cannabis sales growth had pushed Aurora shares to new all-time NYSE lows below $4.58.

Aurora dropped below $4 in October, below $3 in November and finally below $2 in December. Unfortunately, 2020 hasn’t provided much relief for Aurora investors so far. The company recently announced the departure of its founding CEO and reported a $981 million net loss in the fourth quarter. Revenue growth on the quarter was just 3.3%.

2020 And Beyond

Aurora hit its all-time NYSE low of $1.43 on Feb. 13 before bouncing back above the $1.70 level. Unfortunately, the volatile stock has thus far failed to break out of its bearish technical pattern of lower lows and lower highs, suggesting new lows may be in the cards in coming weeks.

Like many other cannabis stock investors, Aurora investors have fallen well short of the returns of the S&P 500 since its NYSE listing. In fact, $100 in Aurora shares purchased at the initial listing price would now be worth just $22.76.
Looking ahead, analysts are expecting more struggles from Aurora in 2020. The average price target among the 17 analysts covering the stock is $1.51, suggesting 11.4% downside from current levels.

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