Canada’s pot stocks are suffering a major hangover following last week’s legalization, but the sector should begin to settle down, says investor Benj Gallander, who sees sector heavyweight Aurora Cannabis (Aurora Cannabis Stock Quote, Chart: TSX, NYSE:ACB) profiting from a US listing.
Cannabis stocks continue to get punished in the markets on Tuesday, with companies like Canopy Growth, Aphria, and Hexo Corp all down significantly in midday trading. One of the hardest hit is Edmonton, Alberta-based Aurora which has now lost 40 per cent of its value since reaching a high of $16.24 last week.
Trading began this morning for ACB on the NYSE, which follows dual listings from Canadian companies Canopy Growth and Cronos Group (TSX, NASDAQ:CRON), with Aphria last week filing for a US listing as well.
“Through our NYSE listing, Aurora joins an established group of mature global brands with improved access and exposure to an engaged international institutional investor audience,” said Aurora CEO Terry Booth in a press release.
“We have grown from being a licensed producer with a single facility to a horizontality differentiated and vertically integrated global organization with a funded production capacity in excess of 500,000 kg a year, sales and operations on five continents and a team of more than 1,500 employees,” Booth said.
The move will give Aurora exposure to a larger audience of investors, says Gallender, president of Contra the Heard Investment Letter, in conversation with BNN Bloomberg.
“Aurora is looking at getting a wider showing, a wider demographic, so the US is a great place to go,” says Gallender. “It should get it a further following, as will more legalizations in the States. That could help it maybe at some point if the [federal government] decides to go legal there, too. I consider [the listing] a positive move for Aurora.”