Canadian Cannabis stocks have had a torrid past year but amid the coronavirus pandemic there has been a surge in demand and some of the operators have reported exceptional results. In recent weeks several Canadian cannabis stocks have been hot owing to an exceptional first quarter of 2020. Although the Canadian marijuana market has not shown the potential that was predicted when the country legalized pot. Some of the cannabis stocks that have shown strong fundamentals amid the COVID pandemic are expected to perform well in June.
Canopy Growth betting on “Cannabis 2.0” products going forward
One of the stocks poised for more growth this month is Canopy Growth Corp (NYSE:CGC). Canopy is one of the largest cannabis operators in Canada in terms of market cap and sales and is well-positioned to leverage opportunities in the future. The launch of “Cannabis 2.0” last year is a huge opportunity that the company could leverage. Although the pandemic has slowed things due to closure of stores this is a temporary obstacle and once restrictions are lifted the company could see a surge in sales from Cannabis 2.0 products.
The company’s cannabis-infused drinks could change the industry according to Constellation Brands (NYSE:STZ) CEO Bill Newland. With support from Constellation, Canopy Growth is expecting to launch a variety of cannabis-infused beverages as well as mixers which might attract even consumers that have never tried marijuana products before.
Aurora among Canadian cannabis stocks expected to continue surging in June
Another Canadian cannabis stock that is expected to carry its incredible performance from May to June is Aurora Cannabis (NYSE:ACB) which surged almost 70% Last month. The company reported better than expected Q3 results recently with its revenue growing 18% from the previous quarter. Similarly, the company reduced its cash burn compared to previous quarters.
Aurora maintains that it will report positive adjusted earnings by September this year. In an earnings call, the company’s interim CEO Michael Singer said that because of current uncertainties the company might be forced to access it’s at the money facility for issuing more shares. The company recently announced the acquisition of US cannabis company Reliva which will likely offer it a pathway to the US market.
Cronos focusing on international markets
Cronos Group (NASDAQ:CRON) is also another cannabis operator that is showing a lot of potential going into June. In its recent earnings report the company reported a 180% YoY growth in revenue but operating losses also widened. Because of oversupply in the market, the company was forced to write down inventory worth $8 million.
Regardless of the market oversupply and widening operating losses the company is in a strong financial position to leverage opportunities going forward. At the end of the quarter, the company had cash and cash equivalents of $1.1 billion and it is backed the deep pockets of Altria Group (NYSE:MO). With its solid cash position the company has been focusing on international markets where margins and prices are high relative to Canada.