Aphria (TSX:APHA) Misses Sales Estimates in Q2
In what’s become a recurring trend for marijuana stocks, yet another big player has missed sales targets for the quarter. Aphria Inc(TSX:APHA)(NYSE:APHA) released its second-quarter results last week. And while sales were up significantly from the prior year, they came in well below what analysts were expecting.
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These big misses suggest that analysts may have been expecting too much from the industry in its early days. While the growth opportunities are certainly there, it’s a reminder that there’s a possibility that the market might not be as big as it was once hoped. The black market is still a very big player and it isn’t going away anytime soon. Without excise and sales taxes, it’s going to be at a more appealing price point than what big corporations can offer the casual cannabis user. And with the rollout of the recreational market being less than optimal with Ontario not having any physical stores until later this year, it’s been a big reminder of how the government might mess things up.
Granted, we are still in the early days of the cannabis industry but the problems remain the same. Companies are struggling to turn a profit and are relying on non-operational items to give them a boost. Sales are not as strong as expected, and investors are left second-guessing just how big the market will be.
However, recent developments in the U.S. cannabis market could open up a whole new wave of opportunities for marijuana stocks. Investors will want to stay tuned and keep a close eye on what happens next as this industry continues to move at a rapid pace.