Two different firms have recently updated their buy ratings for shares of Aphria Inc. (TSX:APH) (OTC:APHQF) (FRA:10E) closely following the company's announcement that it has entered a strategic relationship with Double Diamond Farms to provide an additional 120,000 kgs of annual cannabis production, as well as the company's announcement that it increased revenues by 39%.
The analysts' 12-month price targets both provide tremendous upside potential for shares of Aphria, so we wanted to fill in existing and prospective investors on the price targets and the theses behind them.
Canaccord Genuity
Matt Bottomley, the Alternative Pharmaceuticals Research Analyst at Canaccord Genuity reiterated his buy rating on shares of Aphria. Bottomley' price target for the stock is $23.00 CAD per share, equivalent to roughly $18.36 USD. At the time of writing this, shares of Aphria on the TSX were trading at $20.94 CAD per share, representing over 9.8% upside potential.
Bottomey's $23 CAD price target is just north of the average analyst price target of $19.42, according to TipRanks. With that said, the $23 CAD price target is below the price target from Noel Atkinson at Clarus.
Clarus Securities
Noel Atkinson, CFA, the Vice President of Equity Research at Clarus Securities, also reiterated his buy rating on shares of Aphria. Atkinson's price target for the stock is $25.25 CAD per share, equivalent to roughly $20.13 USD. At the time of writing this, shares of Aphria on the TSX were trading at $20.94 per share, representing over 20% potential upside.
Atkinson stated:
“We have increased our CY19 and FY20 (May) estimates as a result of the higher capacity outlook, and we expect the minority interest offset in Adj. EBITDA to be relatively modest. Our price target rises to C$25.25 per share (was C$23.25) or 20x CY2019 (12 months ending February 2020) EV/Adj. EBITDA. We maintain our Buy rating but caution of high intra- day and inter-day share price volatility being seen across the cannabis LP sector."
This is the highest price target out of the three analysts covering the company.
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