What's In Store For Aurora Cannabis' (ACB) Q1 Earnings?

Aurora Cannabis Inc. (TSX:ACB) is scheduled to report first-quarter fiscal 2020 results on Nov 14, after market close. Encouraging prospects in the Canada and international markets are indicative of a solid first quarter.

Which Way Are Estimates Headed?

For the quarter to be reported, the Zacks Consensus Estimate for Aurora Cannabis’ bottom line stands at a loss of 3 cents. The same for revenues is pinned at $72.8 million, suggesting a substantial year-over-year rise of 220.7%.

Factors at Play

Aurora Cannabis is likely to have witnessed cannabis revenue growth across all market segments — Canadian Medical, Canadian Consumer and International Medical — in the third quarter. Higher production from company’s facilities like Aurora Sky, Bradford, Aurora Air and Polaris might have contributed to growth. With more stores added in recent times, management expects to see a solid first quarter.

Further, the company is likely to have seen growth in medical cannabis sales in the quarter under review on consistent expansion of patient base. Another key performance indicator for Aurora Cannabis is the quantity of kilograms produced.

In Italy, Aurora Cannabis recently won a public tender for supplying medical cannabis for a period of two years, which is likely to have boosted the fiscal first-quarter performance. The introduction of product formats in the Canadian and international consumer markets is also expected to reflect in the upcoming quarterly results.

Despite these positives, competition is stiff in the medical marijuana space which might weigh heavily on Aurora Cannabis’ margins. Notably, the company competes with manufacturers like Aphria, whose cannabis products are much in demand in Canada.

What Does Our Model Say?

Per our proven model, a stock needs to have a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) to deliver a positive earnings surprise in the quarter. But that is not the case here.

Earnings ESP: Aurora Cannabis has an Earnings ESP of -6.95%. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Zacks Rank: Aurora Cannabis carries a Zacks Rank #3.

Stocks Worth a Look

Here are a few stocks worth considering as they have the right combination of elements to post an earnings beat this time around.

Canopy Growth Corporation (NYSE:CGC) has an Earnings ESP of +11.53% and a Zacks Rank #3.

Bank of Montreal (TSX:BMO) has an Earnings ESP of +1.52% and a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

Carnival Corporation (NYSE:CCL) has an Earnings ESP of +11.11% and a Zacks Rank #3.

5 Stocks Set to Double

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