Canadian pot producers Aurora Cannabis have been rivals for years.
However, both companies are struggling to be the attractive growth investments they were before marijuana legalization took place in Canada in 2018.
The company noted “continued price compression” in the Canadian market and more competition in international markets as some of the reasons its revenue hasn’t been particularly strong of late.
Although that was down 11% year over year, it was a 10% improvement from the previous three-month period , where net sales totaled CA$54.8 million.
Although Aurora’s revenue was smaller, the company looks better on the top line because it increased quarter over quarter, and it had a solid segment that grew by double digits.
Neither Aurora Cannabis nor Canopy Growth reported profits in their latest quarters, but the former was a lot closer than the latter.
This past period, Aurora reported a CA$12.1 million loss based on adjusted earnings before interest, taxes, depreciation and amortization , which shrank from the CA$19.7 million loss it incurred in the prior period.
Canopy Growth, meanwhile, is not committing to a date for when it might achieve positive adjusted EBITDA, noting “Canada supply challenges and a delayed revenue ramp in the U.S.” have thwarted its plans.
The company’s adjusted EBITDA loss of CA$162.6 million this past period was more than double the CA$63.6 million loss it posted three months earlier.
market makes it likely that it won’t turn a profit at least until legalization takes place in the U.S., when it can take advantage of having access to a much larger pot market.
This year has been a rough one for both of these pot stocks as Aurora is down 18% year to date, and that’s the better return — Canopy Growth’s stock has fallen by more than 51%.
Trading at a multiple of less than seven times its revenue, Aurora is also the cheaper buy as investors are paying more than 10 times revenue for Canopy Growth.