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Aurora Cannabis (TSX:ACB) saw shares drop this week as the cannabis producer announced its plans to consolidate shares on a 1-for-10 basis. This reverse stock split by Aurora stock is the latest among cannabis stocks, but does that mean success?
What happened
The biggest issue for Aurora stock is staying listed. Shares currently trade at $0.50 as of writing. If it remains below the $1 mark for over 30 trading days, then it risks being delisted. Therefore, consolidating shares gives the company better access to a wide range of institutional investors.
The plan is set to take place on February 20, and would be the second time the company consolidated shares. The first was on a 1-for-12 basis back in 2020.
But shares seem to have dropped for a reason. So the big question is, should investors see this as a way to get back into Aurora stock? Or is it perhaps a sign of worse things to come?
