Better Buy: Aurora Cannabis vs. Charlotte's Web

Neither Aurora Cannabis (NYSE: ACB) nor Charlotte's Web (OTC: CWBHF) has escaped the bloodbath cannabis stocks experienced this year. Since early January, Aurora's shares have plunged by about 55%, while Charlotte's Web's shares are down by about 29% over the same period. By contrast, the S&P 500 index is up by 28% since the beginning of the year. While both companies have performed badly this year, let's dig into their operations and find out which of the two is likely to outperform the other from here on out.

Aurora Cannabis is likely to become the leader in the Canadian market in terms of production capacity with a projected output of at least 625,000 kilograms per year. In addition, the company has managed to sign supply agreements with eight Canadian provinces. In other words, Aurora seems well-positioned to profit from the Canadian pot market, and although the dried cannabis market in Canada has faced a number of issues -- including a shortage of legally licensed retail stores -- Aurora could benefit from the derivatives market that recently opened north of the border. During the company's first-quarter 2020 earnings conference call, Aurora's chief corporate officer Cam Battley announced Aurora's initial portfolio of derivative products, which will include "vapes, concentrates, gummies, chocolates, mints and cookies."

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Source Fool.com