It was a big day for Canadian cannabis stock Aurora Cannabis (TSE:ACB), as it posted its earnings report with a hefty increase in its revenue figures for its third quarter of fiscal 2025. Investors piled in in a big way, and sent Aurora Cannabis shares blazing up nearly 45% in Wednesday morning’s trading.
Maximize Your Portfolio with Data Driven Insights:
- Leverage the power of TipRanks' Smart Score, a data-driven tool to help you uncover top performing stocks and make informed investment decisions.
- Monitor your stock picks and compare them to top Wall Street Analysts' recommendations with Your Smart Portfolio
The news was almost universally good for Aurora Cannabis. Aurora Cannabis reported C$88.2 million in revenue, which is up 37% against the third quarter of fiscal 2024’s C$64.4 million. As good as that was, it got even better when earnings before interest, taxes, depreciation and amortization (EBITDA) came into play; that was up to C$23.1 million, which was up a whopping 316% against the C$5.5 million from a year prior.
Things improved still further from there, as executive chairman and CEO Miguel Martin called attention to not only the wins posted this quarter—net income and adjusted EBITDA increases—but also the wins it has been building on. These include a “strong cash position” and a “debt-free cannabis business,” which suggests a very strong fiscal position going forward.
Reasons Behind the Gain
A breakdown of the sectors involved demonstrates why so much gain was seen in the first place. While its consumer cannabis revenue dropped 15%, down to just C$9.9 million against C$11.6 million a year prior, its medical cannabis numbers shot up. Medical cannabis brought in a net revenue of C$68.1 million, which was up 51% against a year prior.
Given that just weeks ago, Aurora rolled out a domestically-grown cannabis line in Germany—which was itself part of a new “cultivation license”, the end result was a hefty surge in profits. Germany only recently moved to decriminalize cannabis possession to begin with, so branching out into the medical line was a good way to ensure present business while also preparing for future private business.
Is Aurora Cannabis Stock Worth Buying?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on TSE:ACB stock based on three Buys and two Holds assigned in the past three months, as indicated by the graphic below. After an 38.91% rally in its share price over the past year, the average TSE:ACB price target of C$8.97 per share implies 17.45% upside potential.
