Aurora Cannabis surges after hiring activist investor Peltz as advisor

“I believe Aurora incorporates a solid execution track record, can be strongly differentiated coming from its peers, has achieved integration throughout the value chain as well as also can be poised to go to the next level across a range of industry verticals,” Peltz said within the Discharge.

“I also believe that will Canadian licensed producers, as well as also Aurora in particular, are well positioned to lead within the development of the international cannabis industry as regulations evolve, using a strong, globally replicable operating type.”

The addition of Peltz to the Aurora team represents one of the largest endorsements of the nascent cannabis industry.

Peltz, who founded as well as also serves as CEO of brand new York-based Trian Partners, has over the decades commanded respect across Wall Street for his investing prowess as well as also ability to reshape companies. As an activist investor, Peltz as well as also Trian Partners take stakes in public companies they believe are undervalued as well as also push management to make alterations over several years.

nevertheless Peltz will also prove a valuable addition to Aurora for his deep knowledge of the consumer goods industry, where he’s tended to focus his investments. Current investments for the multibillion-dollar fund include a $3.6 billion stake in Procter & Gamble, an $884 million stake in packaged foods giant Mondelez as well as also a longtime, $471 million investment in Wendy’s.

Trian also held shares in PepsiCo until 2016, when the activist investor ultimately dissolved its $2 billion stake after three years of deliberations with management.

“We see quite a few potential of growth areas, certainly consumer packaged goods,” Michael Singer, Aurora’s executive chairman, said Wednesday on CNBC’s “Squawk Box.” “The beverage industry, cosmetics, wellness; we see pharmaceuticals today starting to show interest in our space. There are quite a few what we call market segments that will we expect to operate in with one or many of these potential partners.”

The addition of the high-profile advisor increase the odds of additional strategic partnerships as well as also can be sufficient reason to upgrade Aurora’s stock rating to buy, GMP Securities analyst Martin Landry told clients Wednesday. The analyst nearly tripled his cost target on the company to CA$15 coming from CA$5.50.

“Trian has been involved with quite a few consumer packaged goods companies such as PepsiCo, Dr Pepper Snapple, Procter & Gamble, Kraft Foods, Heinz, Mondelez, among others,” Landry wrote. “We believe he could be instrumental in facilitating discussions with large consumer packaged goods companies.”

Founded in 2006 by CEO Terry Booth, Edmonton, Alberta-based Aurora can be one of the entire world’s largest cannabis producers. Second in market capitalization only to Ontario-based Canopy Growth, Aurora has built revenues as well as also earnings at a dizzying pace in recent years as more jurisdictions approve the adult use of recreational marijuana.