What happened
Canadian marijuana giant shares Aurora Cannabis (NYSE: ACB) jumped up to 17% in pre-market trading on Wednesday morning. The marijuana grower’s stock is soaring north in response to the first results of two second-round Senate elections in Georgia, held yesterday.
While ballots are still being counted in Peach State, some major news outlets are already calling the race for challenger Democrat Rev. Raphael Warnock over Republican Senator Kelly Loeffler. Democrat Jon Ossoff also has a slight advantage over Republican Senator David Perdue, with 98% of the votes counted, according to several sources. Democrats, therefore, appear to be on the verge of matching the Senate with 50 seats each.
Image source: Getty Images.
And
In the past two years, three major marijuana reform laws have been passed in the U.S. House of Representatives. Each time, however, these projects have gone nowhere in the Republican-controlled Senate, largely thanks to opposition from the current majority leader, Mitch McConnell. One or more of these marijuana reform projects, however, may now have a chance to actually pass in light of this potential shift in power. Aurora, therefore, may be able to broadly expand its presence in the United States in the coming years.
What now
Is this stock of marijuana a purchase in the wake of this possible political change in the United States? Unfortunately, the answer is a solid no. There is no way to say for sure how far any initial marijuana reform in the US will go. In addition, the United States already has several established multi-state operators. Simply put, Aurora is unlikely to gain any material benefit from this likely political turnaround in 2021.