Aphria stock worth considering due to recent gains

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The company has seen improvements of up to 26% recently

Thanks to the opinion of an expert in the stock market, Aphria Inc. shares climbed 8.8% this past Monday. The analysis was published by Stifel analyst W. Andrew Carter, who changed his rating for this cannabis venture from hold to buy, as well as stating a target price for the company’s shares at $5.90. With this new forecast, investors might be looking at potential gains of 26%, which is based on Aphria’s current stock price of $4.68. This might be an ideal time for investors to put their money on a sure bet.

According to Carter, Aphria’s stock should have a premium valuation if put next to other companies like Aurora Cannabis, because it has a much better balance sheet and metrics for profitability. The analyst added that, when the company presents its result for the fourth quarter that ended on May 31, it should show that the overall sales have doubled in fiscal 2020, to $390 million. So, for fiscal 2021 and 2022, Carter foresees the company’s sales will increase by 21% and 29%, respectively, and the main reason will be due to new retail stores being opened in Canada.

In addition to those positive numbers, Carter predicts that Aphria will have positive cash flow as soon as 2021, which will increase to $100 million by 2022. Based on this analysis, Carter predicts that investors will give Aphria a higher valuation than the one given lo lower performers. “We believe the fundamental performance will drive a re-rating for the shares,” he said