APHA - 3 Underrated Pot Stocks to Buy in 2020
It can be difficult to find good buys in the cannabis industry, especially since a lot of the focus is on industry leaders Aurora Cannabis (NYSE: ACB) and Canopy Growth (NYSE: CGC). That means investors may overlook other, smaller stocks that may not get as much attention but that offer good value. Below are three stocks in that category that could be good buys this year as the industry matures.
With a market cap of $1.1 million, Aphria (NYSE: APHA) is technically one of the bigger pot stocks on the market. However, the stock often doesn't benefit from the same fanfare Canopy Growth and Aurora enjoy. It trades at only three times revenue, meaning investors value it significantly less than the nine times they're willing to pay for Aurora's stock. Canopy's price-to-sales multiple of 26 is even larger.
What makes Aphria an intriguing option for investors is that with sales of 449 million Canadian dollars over the past 12 months, it generated significantly more over the past four quarters than Aurora, which posted CA$295 million. Aphria's recorded more revenue than Canopy Growth as well, which saw sales over the last 12 months of CA$385 million.