Here's The Latest On Aurora Cannabis Ahead Of Today's Earnings Report

Canadian cannabis giant Aurora Cannabis ACB will release its second-quarter fiscal 2021 earnings report late on Thursday.
See also: How to Buy Tilray Here (ACB) Stock 

Here's what to expect.

Earnings Estimates, Recent Activities

Wall Street estimates the Edmonton, Canada-based company will post a loss of 19 cents per share (CA$0.24), while revenue is projected to rise 29% to about $55 million. (h/t Investor’s Business Daily).

Aurora remains focused on repairing its balance sheet, due to the company’s being saddled with debt.

Going forward, the company is expected to concentrate on third-party cannabis suppliers and avoid expensive growing operations.

Reducing Staff

In 2020, Aurora let go more than 1200 of its employees in an effort to improve the balance sheet.

It began the previous year with layoffs and ended it with another wave. In February 2020, the company cut around 340 jobs; in June it laid off 700 employees; and in December some 230 more.

It had to close activities at its Aurora Sun facility and opted to reduce the production at its flagship Aurora Sky facility by 75%.

This year, Aurora cut sales staff in January after picking Great North Distributors for its sales representatives in the Canadian recreational cannabis market, according to Marijuana Business Daily.

Why Aurora Stock Jumped This Week

There was a marijuana stocks rally on Wednesday (a sell-off Thursday), marked by a plethora of financial earnings reports, M&A deals, talks about legalization, and a newly acquired interest from investors on social media — specifically the Reddit community WallStreetBets (h/t The Street). On Wednesday:

• ETFMG Alternative Harvest ETF MJ was up 9.4% at one point
• Tilray TLRY was surging 30.7%
• Canopy Growth CGC was up 4.4%
• Sundial Growers SNDL jumped 38%
• Aurora rose 11.8%.

Recall how WallStreetBets — a subreddit where participants discuss stock and option trading — grabbed headlines when it pumped the stocks of GameStop GME, AMC Entertainment AMC and Inovio Pharmaceuticals INO.”

"The marijuana industry will be a $1T industry in 10 years once Europe and Asia are open," one Reddit poster noted. "There will be a few $100b+ companies, and my bet is Aphria/Tilray will lead the way."

Will Aurora Have A Strong Comeback In 2021?

Aurora is unable to work on any growth initiatives or develop new products, due to its current financial situation. (h/t The Motley Fool)

In 2020, it fell short of its EBITDA goals, and the stock dipped 68%. Nevertheless, year-to-date the stock is up around 60%. What is causing the jump and is Aurora positioned for growth in 2021?

Well, back in December, the company offered a business update announcing another EBITDA loss for the second-quarter fiscal 2021, which makes profitability unlikely.

Perhaps Aurora’s only means of raising capital is via share dilution, and there are no consolidation news on the horizon.

At the moment of publication Thursday, Aurora was trading 20.73% lower at $15.00 per share.

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