Will Aurora Cannabis Q1 results bring positive surprise as stock routed 77% YTD?

Aurora Cannabis (NASDAQ:ACB) is scheduled to announce FQ1 earnings results on Thursday, November 10th, after market close.

The consensus EPS Estimate is -$0.11 and the consensus Revenue Estimate is $40M.

Over the last 3 months, EPS estimates have seen 0 upward revision and 0 downward. Revenue estimates have seen 2 upward revisions and 1 downward.

The Canadian cannabis company’s stock fell -7.14% on Sept. 21 after its FQ4 results, which saw net loss balloon to C$618.8M, compared to C$134M in the prior-year period, as a result of non-cash impairment charges of C$505.1M. FQ4 net revenue declined -8% Y/Y to C$50.2M.

Cannabis peers, Canopy Growth and Cronos have already reported their quarterly results. While Canopy’s stock is surging today (Nov. 9) after its FQ2 revenue beat analysts estimates, Cronos saw its stock slump -9.42% on Nov. 7 after its Q3 results missed estimates.

YTD, Aurora’s stock has shed ~77% and has a Hold rating at the SA Quant Rating and the average Wall Street Analysts’ Rating, both. The chart below shows 6-month price-return performance of cannabis peers, Aurora, Tilray, Canopy Growth, and Cronos.

In October, Senate Majority Leader Chuck Schumer said that the Senate was very close to agreeing on legislation that would allow cannabis businesses access to the U.S. banking system. The legislation is similar to the SAFE Banking Plus legislation that has been floated around. It includes both banking reform and marijuana conviction expungements. However, this legislation is unlikely to include language related to federal marijuana legalization, according to a report.

Meanwhile, a poll commissioned by the American Bankers Association found that 66% of American adults support cannabis banking.

Separately, President Joe Biden had asked the U.S. Department of Justice and HHS to “review expeditiously how marijuana is scheduled under federal law,” which sent cannabis stocks soaring.

In September, the Government of Canada began a legislative review of the 2018 Cannabis Act, a legislation that legalized the sale of marijuana in the country. The regulator said that the review was needed to ensure that the law adapts to the current cannabis control situation and continues to meet Canadians’ needs and expectations.