Shares of marijuana producer Aurora Cannabis were falling on Monday, the first day of trading for the company after it went through a 1-for-12 reverse stock split.
It was in April that Aurora proposed to execute the split after shares had traded under $1 for over 30 days and the company was close to losing its listing on the NYSE.
Holders of Aurora now own one share for every 12 they had previously. The split consolidated the total shares outstanding to 110 million from more than 1.3 billion at 12 times the previous share price.
Analysts at Cowen have put a new C$12 (US$8.55) price target on the shares trading on the Toronto Stock Exchange.
“We have a market perform rating on ACB. With one of the largest production capacities among the LPs, ACB has gotten off to a solid start in the Canadian adult use cannabis industry (an estimated C$12 billion by 2025),” Cowen analyst Vivien Azer wrote.
“However, cost overruns and missed targets have resulted in notable management turnover and the need to refinance debt with strict mandates around -profitability.”
The company is expected to report fiscal-third-quarter earnings on Thursday.
Disclaimer: We have no position in Aurora Cannabis (NYSE: ACB) and have not been compensated for this article.
