The Marijuana industry has jumped into the limelight in recent years, and especially in 2019 it has been a strong year so far for cannabis stocks. As key companies in the sector have begun to see better results from major events such as the opening of the Canadian cannabis product sales market, investors are looking closer to the strategies to see how marijuana companies intend to stand out from their competitors and find their own unique pathways to growth.
Earlier this week, Aurora Cannabis
1. The Importance of Medical Marijuana
We are a medical company at heart. We support our patients not only with high quality product, but also with law firm, education and scientific research. We have competed, are involved in, and start about 40 clinical studies and medical case studies in addition to seven preclinical studies.
– COO Cam Battley
According to the excitement of recreational use of cannabis, Aurora does not want investors to forget about its roots in the medical marijuana market. In many areas of the world, medical applications are the only reason to buy cannabis products, and Aurora has generated a positive reputation worldwide for its medical marijuana skills. It is an advantage that Battley sees giving Aurora an edge that several countries around the world are looking to allow the sale of cannabis.
2. Branding is key
In the consumer market, we mainly sell to our partners, the provinces. But we also participate in this new market by investing in retail organizations. In addition to the investment in Alcanna, which operates North America's largest chain of non-governmental owners and targets a large number of stores around the country, we strategically invested in Choom Holdings and High Tide, two emerging leaders in the Canadian retail space.
Aurora understands that if it wants to be a leader in the industry, it must establish itself not only as a supplier of quality products, but also build brand awareness. The company achieved more than 20% market share in Canada's retail development, and cannabis strains are among the top-ranked products found in Canada's recreational market. Nevertheless, to build the power of Aurora's brands, distribution capacity at dedicated retail locations has an important complement to being available on state operations. Building a brand will also help Aurora as it expands globally.
3. Volume is rising rapidly
Our cannabis production in the quarter increased by 57% to 7.822 kg. This increase in production is attributable to capacity from both Aurora Sky and MedReleaf's Markham and Bradford plants. We expect to achieve annual production capacity of at least 150,000 kilograms at the end of [March].
– CFO Glen Ibbott
With marijuana markets opening up, enough products have been available, been an important obstacle to overcoming. Aurora has ambitious plans to increase production capacity, and already pays off efforts to increase throughput through acquisitions and organic growth. Aurora harvested more cannabis in the first five weeks of 2019 than the whole year's production capacity a year ago, and these trends are likely to continue.
4. The US market is in a state of confusion
The Farm Law, which was put in place that allowed the production and distribution of hemp in the United States, was not properly affected by the CBD distribution. … So there is some legal confusion in the US. … We come in when it is right to enter and when it is legal to enter the US market.
– CEO Terry Booth
Much has been done of the possibility of marijuana companies entering the US market through the recent legalization of hammock production under the just-American farm bill. Aurora looks like a first mover in the hemp expression , and Booth believes the US will play a key role in overall growth. But Booth also obviously sees the United States as just part of the global opportunity, and his vision is centered on ensuring that Aurora can produce enough cannabis to deliver consumer needs worldwide.
5. Expecting Many Future Progress Operatively
When you look the rest of the year, you can expect to see our running costs down as our Sky Class facilities come online, and we continue to reduce operating costs. We will leverage our leadership in international markets to accelerate further growth. We launch product innovations and continue to innovate along the value chain.
As the cannabis industry grows, it is becoming increasingly important for leading companies to improve their business. Aurora has identified the need to be knowledgeable in managing its internal business effectively, and institutional investors who have shown great interest in cannabis holdings will judge among major players according to their ability to deliver good performance and business practices. Aurora Cannabis has a lot of competition and it will not be able to maintain its leading role in standing still.
Keep your eyes on Aurora
Aurora Cannabis has a lot of competition and it will not be able to maintain its leading role in standing still. With ambitious strategic plans in place, Aurora hopes to continue building momentum and remaining one of the most important marijuana stocks in the market.
Dan Caplinger has no position in any of the aforementioned shares. Motley Fool has no position in any of the aforementioned shares. Motley Fool has a disclosure policy.