Today I will be checking out the particulars associated with Aphria Inc. (APH TSXV). This is part of an in depth analysis of listed companies operating in the emerging marijuana industry. APH produces, supplies, and sells medical marijuana in the form of cannabis oil and dried leaf. The company operates out of Leamington, Ontario and recently announced plans to double their capacity.
The company has a market capitalization of $143.47 million and average daily volume over the last three months of 293,539 shares. The company reported its Q4 results with a 17% increase in its patient base and a 31% decrease in costs. It was the second consecutive quarter of profitability for APH.
An inspection of the charts will add greater context to the evaluation.
The two-year chart indicates that the stock has established a pattern of advances followed by retreats and tests of support along the 200-day moving average. Worth mentioning are the buy and sell signals generated by the MACD and the RSI over the course of the advance. The buy signals in February and June of 2016 led to a couple of very profitable runs that lasted long enough to get on and off the ride with some mad stacks of cash.
The six-month chart highlights the test of support along the 200-day moving average in February as well as the buy and sell signals generated by the momentum indicators. At this point it might be prudent to wait for a better entry point. The explosive run in July has taken the stock into overbought territory which will get some of the players to capture profits.
When he was alive Ted Carter, publisher of Carter’s Choice newsletter, taught me and many others, that when dealing with a speculative stock you want to establish a core position and a trading position. You add to your core position on pullbacks with the profits grabbed at the top of an advance.
Next time I will analyze OrganiGram Holdings Inc. OGI TSXV.
Make it a profitable day and happy capitalism!