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<p class = "web-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "A marijuana business, Aurora Cannabis (NYSE: ACB), is uniquely positioned to generate a substantial portion of the industry's profits over the next decade. Read on to find out more. "Data-reactid =" 12 "> A marijuana business, Aurora Cannabis (NYSE: ACB), is uniquely positioned to generate a substantial portion of the industry's profits over the next decade. Read on to find out more about this.
A cannabis leaf on a hundred dollar bill
Source of the image: Getty Images.
Scale of the industry
<p class = "web-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "The maximum production capacity of Aurora Cannabis is unmatched. should produce more than 625,000 kilograms of cannabis per year by 2020. & nbsp; rival producers, only Cover growth (NYSE: CGC) data-reactid = "35"> The maximum production capacity of Aurora Cannabis is unmatched. Aurora is in the process of producing more than 625,000 kg of cannabis per year by 2020. Among rival producers, only Cover growth (NYSE: CGC) appears to be producing at least 500 000 kilograms during this period.
Aurora's superior production capacity should provide it with powerful advantages in terms of scale compared to its smaller competitors. By spreading its costs over a broader sales base, Aurora should be able to generate profit margins that have never been achieved.
In addition, being a low-cost producer should help Aurora deal with short-term over supply problems if its domestic market in Canada is saturated. If the industry disintegrates, Aurora will likely be one of the last cannabis producers to date.
A strong international presence
<p class = "web-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "In addition to the maximum production potential, Aurora Cannabis also leads sector in terms of operational presence in markets outside Canada. Aurora is present in 25 countries. & Nbsp; Its closest competitor, Canopy Growth, is present in only 16 countries. & Nbsp; "data-reactid =" 39 "> In addition to its record production potential, Aurora Cannabis is also the industry leader, Aurora is present in 25 countries and its closest competitor, Canopy Growth, is only present in 16 countries. country.
A person pointing on a digital map of the world
The geographic footprint of Aurora Cannabis is unparalleled among marijuana growers. Source of the image: Getty Images.
As such, Aurora is one step ahead of the competition when it comes to capturing a share of the global market, particularly in the medical marijuana market, which is an area of concentration for society. This is important because the international cannabis market is expected to become several times larger than Canada's in the coming years.
Independence equates to greater potential for long-term gains
<p class = "canvas-atom web-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Aurora is also the most likely major cannabis producers to stay In contrast to his peers, Canopy Growth and Cronos Group (NASDAQ: CRON), who sold stakes in their businesses to Constellation Brands (NYSE: STZ) and Altria (NYSE: MO) for $ 4 billion and $ 1.8 billionTo date, Aurora has so far resisted selling a large equity stake in a larger company. "data-reactid =" 63 "> Aurora is also the largest cannabis producer group most likely to remain independent, unlike its peers, Canopy Growth and Cronos Group (NASDAQ: CRON), who sold stakes in their businesses to Constellation Brands (NYSE: STZ) and Altria (NYSE: MO) Aurora has so far resisted $ 4 billion and $ 1.8 billion, before yielding a substantial stake in a larger company.
Constellation Brands and Altria hold mandates that give them the right to increase their stake in Canopy Growth and the Cronos Group, and many investors expect the beer giant and Titan Tobac to eventually purchase all of the remaining shares of these cannabis producers. Aurora, however, seems on the brink of staying independent.
In the event of an acquisition of Canopy Growth and Cronos Group, investors would likely benefit significantly from current prices. But for investors seeking to profit from the entire explosive growth of the cannabis industry over the next decade, Aurora Cannabis is the title to buy.
<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = " More from The Motley Fool "data-reactid =" 70 "> More from The Motley Fool
<p class = "canvas-atom canvas-text Mb (1.0em) Mb (0) – sm Mt (0.8em) – sm" type = "text" content = "Joe Tenebruso has no position in any of the actions mentioned. Motley Fool recommends Constellation Brands. The Motley Fool has a disclosure policy."data-reactid =" 75 ">Joe Tenebruso has no position in the mentioned actions. Motley Fool recommends Constellation Brands. Motley Fool has a disclosure policy.
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