As one of Canada’s top-tiered cannabis companies, Aurora Cannabis (TSX:ACB) (NYSE:ACB) could be considered a more “obvious” cannabis investment. Currently trading for $8.79 USD on the NYSE, Aurora stock is not the most expensive cannabis play. But considering its size and global reach, there’s a lot of potential ahead.
Aurora Stock and EnWave
However, if you want to look outside the more “obvious” cannabis stock choices, EnWave (TSXV:ENW) could be for you. Because last month, Aurora entered into a licensing deal and “formed an intellectual-property partnership” with EnWave and this has put the company on the map. Further, Aurora Cannabis made a strategic $10 million investment into the small Canadian company and now EnWave stock has gained 25.4% in April.
So for investors looking for stocks flying beneath the radar, EnWave is a potential play.
EnWave produces and distributes all-natural dried cheese snacks. But the important part is that it licenses, manufactures, and installs equipment for dehydrating organic materials—including cannabis.
Shares have been on the move in 2019 and ENW stock has nearly doubled its value already this year.
Q1 fiscal 2019 showed the company’s revenue growing 73% y-o-y. All well and good, but the real catalyst for this stock’s explosive movement was Aurora’s investment last month.
Aurora Stock: The Deal
Aurora’s $10 million investment has given it a 4.91% stake in the company. And the licensing agreement gives it exclusive rights to EnWave’s patented radiant energy vacuum (REV) drying technology for the production of cannabis materials in the European Union (excluding Portugal).
Further, the company has bought two of EnWave’s 120kW REV dehydration systems for its Aurora Sky and Aurora Sun facilities in Canada. There is an intention to buy a third in the coming weeks.
Aurora Stock: REV Technology
The deal is significant for both parties. REV technology reduces drying time from roughly 1 week (air drying) to less than 1 hour. Therefore, Aurora can “bring [its] products to market faster and reap significant working capital savings.”
And with Aurora Cannabis as a bedfellow, EnWave reaps the benefits of heightened stock performance along with the assuredness of having Canada’s second largest cannabis company in its corner. A worthy advocate of its REV technology.
So for investors who want to take a more unique punt in the cannabis market, then EnWave could be worth your time. Aurora stock will, of course, always remain an option, but EnWave could be that ancillary investment that reaps the benefits of anonymity.
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