Aurora Cannabis (NYSE:ACB) stays one of the broadly purchased marijuana shares available on the market. It’s even the most popular pot stock on the Robinhood trading platform.
However, Aurora has been an absolute failure for traders. If you’d purchased $10,000 of Aurora’s shares three years in the past, you’d now have solely round $1,430. If you’d invested the identical quantity firstly of this yr, you’d have lower than $2,900.
This well-liked pot inventory has been like poison for traders’ portfolios, and this one chart explains why.
Aurora’s dilution answer
The chart under illustrates the inverse relationship between Aurora’s growing variety of diluted shares and its reducing share worth. This relationship is sensible when you concentrate on it. A better variety of shares makes present shares much less worthwhile.
How would Aurora’s shares have carried out with out all of its dilution-causing inventory choices? There’s no solution to know for positive since a number of components influence a inventory’s efficiency. However, right here’s one other chart that would assist us get a really feel for what might need been:
The solely distinction between the primary and second charts is that the latter consists of Aurora’s…