uploads///esteban lopez  unsplash

Aurora Cannabis: Analyzing Its Valuations in June

By

Jun. 7 2019, Updated 7:36 a.m. ET

Valuations

Aurora Cannabis (ACB) has traded at a premium valuation compared to its peers since the beginning of this year. Currently, the stock is trading at a forward EV-to-sales multiple of 14.5x, which is higher than its peers’ median multiple of 6.3x.

Article continues below advertisement

Peers

Similar to Aurora Cannabis, a handful of its peers have continued to trade at a premium to the median. The companies include Canopy Growth (WEED), Cronos Group (CRON), and Tilray (TLRY). As of June 6, these stocks were trading at forward multiples of 19.0x, 36.0x, and 10.0x.

When we eyeball the trend in Aurora Cannabis’ valuation multiple in the above chart, it appears to be right in the middle of its high and low range. Compared to the historical period, the stock is trading at a premium to its average of 10.9x. We must consider the periods with higher valuations after developments towards recreational cannabis moved ahead in Canada.

Comparing Aurora Cannabis to its peers’ median and past levels, the stock doesn’t appear relatively cheap. However, Aurora Cannabis is one of the top five cannabis companies, which could be leading investors to pay a premium on the stock.

Advertisement

More From Market Realist

  • CONNECT with Market Realist
  • Link to Facebook
  • Link to Twitter
  • Link to Instagram
  • Link to Email Subscribe
Market Realist Logo
Do Not Sell My Personal Information

© Copyright 2021 Market Realist. Market Realist is a registered trademark. All Rights Reserved. People may receive compensation for some links to products and services on this website. Offers may be subject to change without notice.