Categories Cannabis, Earnings

What to expect when Aphria (APHA) reports Q2 results

Aphria Inc. (NYSE: APHA) is scheduled to report second quarter 2020 earnings results on Tuesday, January 14, before the market opens. Analysts expect the company to report a loss of $0.02 per share on revenue of $100.8 million.

In the first quarter of 2020, the company surprised the Street with earnings of CAD 0.07 per share while the forecasts were for a loss of CAD 0.01. However, revenues of CAD 126.1 million came below the estimates of CAD 138.4 million.

Aphria reported second consecutive quarter of profitability in Q1

Last quarter, Aphria said it was on track on achieve an annual production capacity of 255,000 kilograms when all facilities are licensed and operational. In November, the company doubled its production capacity after receiving cultivation license for its Aphria Diamond facility.

The addition of 140,000 kg of production from Aphria Diamond helped the company reach its target of annualized production capacity of 255,000 kg. This is a huge positive.

Also see: Aphria Q1 2020 Earnings Conference Call Transcript

Aphria also started rolling out cannabis vape products which come with its share of concerns. Vaping is facing several controversies and is currently under close scrutiny. Updates on this area will be worth watching.

In general, the outlook for cannabis stocks appears to be bullish for this year on the expectations of strong demand and easing of regulations.

For the full year of 2020, the company has guided for net revenue of approx. $650 million to $700 million and adjusted EBITDA of approx. $88 million to $95 million.

The stock has dropped 27% in the past one year and 5% over the past week. It has a majority rating of Buy and an average price target of $8.61.

Also Read:  Lululemon’s expansion spree pays off as Q4 results top expectations

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