Excellent in-depth Conviction Call Report on Aphria A highly recommened read!
Must read for Serious Aphria Investors - Here WHY APHRIA? APHRIA STOCK TRADES AT A DEEP DISCOUNT
Aphria trades at a 50% discount to the average cannabis industry enterprise value to EBITDA multiple (Aphria at 6x versus Cannabis industry at 12x). This discount persists even though Aphria is the third largest cannabis company globally. With the lowest industry cost structure Aphria should generate above average profitability in a newly legal market leading to a rerating in the stock. If Aphria trades in line with the market average there is more than 100% upside to the current stock price.
APHRIA IS ONE OF THE HIGHEST QUALITY TAKEOVER TARGETS IN CANNABIS
Aphria possesses the following four characteristics that make it one of the most desirable takeover targets in the cannabis industry. • A diversified group of assets all over the world and growing capacity that can scale to meet demand • A management team that can execute with a history of business success • A cost structure that maximizes the return of an outside investor • A low valuation compared to similar sized cannabis stocks
LOWEST GROWING COSTS IN THE INDUSTRY MAXIMIZE PROFITABILITY
Aphria’s production costs are 45% lower than the next licensed producer and 60% below the industry average. The company is integrating robotics and automation on a scale never seen in a legal cannabis greenhouse, allowing them to maintain and potentially grow their cost lead over peers. Investing in the low-cost producer mitigates risk in periods where cannabis flower prices are low while also amplifying upside with the low-cost producers generating above average cashflow and margins.
THE APHRIA MANAGEMENT TEAM IS THE BEST IN THE BUSINESS
The cannabis industry has a real shortage of qualified management teams. There is an abundance of financiers with little on the ground knowledge of how to build and operate greenhouses, grow quality cannabis, or build brands. Aphria has a management team with decades of experience in the following critical areas that will determine success in the emerging cannabis industry. • Production and quality assurance of highly regulated consumer health products • Cultivation of produce and construction of greenhouse assets at scale • Domestic and global distribution of consumer health products • Creation and management of global consumer brands