Aphria Inc. APHA

Aphria, which is headquartered in Ontario, produces and sells medicinal and recreational cannabis. The company operates through retail and wholesale channels in Canada and internationally. Aphria is a main distributor of medical cannabis to Germany and has operations in over 10 countries outside of Canada. However, it does not have exposure to the U.S. CBD or THC markets due to the constraints of federal prohibition. It has some U.S. exposure through the acquisition of SweetWater, a craft brewer

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Post by HARJAYon May 01, 2021 11:55pm

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Post# 33110013

FYI

U.S. cannabis stocks to enjoy further upside after recent legal changes: Barron’s

Stocks mentioned: CURLF, CGC, TLRY, APHA

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While many Canadian cannabis stocks dropped over the past two years, their U.S. counterparts are likely to continue their recent gains, notes Barron’s in a recent article on the American marijuana industry.
Despite their losses and the sales trailing those of U.S. rivals, the Canadian producers such as Canopy Growth (NASDAQ:CGC), Tilray (NASDAQ:TLRY), or Aphria (NASDAQ:APHA) are listed on NASDAQ, given their legality in the home market, authors, Max A. Cherney and Connor Smith point out.
Meanwhile, American companies such as Curaleaf (OTCPK:CURLF), Green Thumb Industries (OTCQX:GTBIF), Trulieve Cannabis (OTCQX:TCNNF), and Cresco Labs (OTCQX:CRLBF) are weighed down by federal illegality and they trade over the counter.
Yet, U.S. cannabis chains are profitable and seeing sales growth of as much as a two-fold and three-fold rise, the authors noted.
However, with recent legal changes in their favor, the ‘sales can’t help but grow,’ Cherney and Connor argue pointing to among other things, the SAFE Banking Act passed by the House and the state-backed legalizations.
When federally imposed rules on taxation fade away, ‘profits should get even better,’ the authors predict, highlighting a section of the U.S. tax code known as 280E which does not allow cannabis companies to deduct normal business expenses and claim credits in their tax returns.
The article also points out the recent moves by certain members of Congress to replace the burdensome provisions of 280E with a more moderate cannabis excise tax.
Other U.S. operators mentioned in the Barron’s include TerrAscend (OTCQX:TRSSF), Columbia Care (OTCQX:CCHWF), Ayr Wellness (OTCQX:AYRWF), and Harvest Health & Recreation (OTCQX:HRVSF).
Recently, Bank of America reinstated the coverage on Tilray and Canopy Growth with buy recommendations arguing that the companies are well-positioned to benefit in the events of federal legalization of cannabis.