Cannabis stocks Aurora Cannabis (NASDAQ:ACB) and Tilray (NASDAQ:TLRY) are climbing today. A note from an analyst appears to have made investors more optimistic about the companies’ opportunities in Europe. In early trading, ACB stock was jumping 8.5% to $1.54, while TLY stock was rising 2.7% to $3.68.
Cannabis Stocks Rise on Cantor Fitzgerald’s Upgrade
Pablo Zuanic, an analyst at investment bank Cantor Fitzgerald, raised his rating today on ACB stock to “overweight” from “neutral.” The analyst contended that, if the U.S. Congress does not legalize cannabis, Germany will become the most important nation for cannabis sellers and marijuana stocks in the upcoming 12 to 18 months. Aurora and Tilray are the only publicly marijuana sellers with “a license to produce” cannabis in the European country, Zuanic wrote, according to Seeking Alpha.
The analyst is bullish on both ACB stock and TLRY stock. But he thinks that Aurora has a better outlook because of its more favorable valuation. Zuanic raised his price target on Aurora to 4.05 CAD from 3.90 CAD.
Other ACB Stock News
In separate news, Aurora Cannabis earlier this week confirmed that it was laying off 12% of its employees worldwide. The company has said that it is looking to become profitable on an adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) basis in the first half of its fiscal 2023.
On May 12, Aurora Cannabis reported that its third-quarter revenue had slid to 50.4 million CAD, down from 55.2 million CAD during the same period a year earlier. On the bright side, the company’s EBITDA loss, excluding certain items, improved 41% year-over-year to 12.3 million CAD.
“Our plan is working. The foundation of our confidence is our global medical cannabis business, which is both defensible and stable with margins that exceed 60%,” said Aurora CEO Miguel Marin on the company’s Q3 earnings call.
On the date of publication, Larry Ramer did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.