Aleafia Health Inc (TSXV:ALEF) is currently in the red. At $2.09 on the TXV Venture Exchange, the stock has hit a new two-week low. At this price, could you consider Aleafia among undervalued stocks?
Let’s have a look.
Undervalued Stocks: Aleafia Health Inc.
One thing to note is that although Aleafia stock is going through a downturn at present, on the year, ALEF has grown a whopping 350% already.
The stock surged from $0.60 to $3.97, and movement like this begs the question, can the ALEF stock manage those kinds of gains again? If it’s back down at the $2.09 mark, is this an undervalued stock?
Very possibly, because two major factors give Aleafia Health stock real potential. First is a pending NASDAQ listing. The second is cannabis legalization in Canada.
Will a NASDAQ Listing Boost this Undervalued Stock?
Aleafia has only recently submitted an application to list on the NASDAQ exchange. This decision is still pending; however, if we assume it is successful, this new listing could see ALEF stock surge in the coming weeks.
Aleafia Health—relatively small with a market cap under $350 million—has had very little US exposure so far. This, for one thing, means its stock price could easily jump.
Listing on the NASDAQ will provide increased liquidity, but also put the company in the same league as a handful of other Canadian cannabis companies that have made the leap to a bigger exchange.
A NASDAQ listing has caused other undervalued stocks to spike in recent months; Cronos Group (NASDAQ:CRON) and Tilray (NASDAQ:TLRY) both experienced significant gains of 18% and 30% respectively after their listings.
However, it’s important to see things from the other side too. Aurora Cannabis (NYSE:ACB) recently uplisted to the New York Stock Exchange, and its stock has been struggling ever since.
>> Undervalued Stocks: At $1, Is Integrated Cannabis Company Undervalued?
Canada’s Recreational Market
And then, of course, Canada’s recreational market has just opened. This industry is young and has much more ahead of itself. Holding onto undervalued stocks at this point could be wise as this industry has so much more to develop.
In time, international medical marijuana markets could also provide even greater potential. As a vertically integrated cannabis company, Aleafia is ensuring it has every basis of the industry covered, from planting to producing to selling.
As the company aims to “execute on [it’s] stated goal of attaining a global leadership position in the cannabis space,” these undervalued stocks might really drive big numbers in time.
Featured Image: Depositphotos/© nito103
