This year has already been a study in contrasts for Aurora Cannabis (NYSE: ACB) and Cresco Labs (OTC: CRLBF). By the end of March, both cannabis companies had seen their valuations more than halved. But since April, shares of both Aurora and Cresco have soared.

Cresco Labs has been the bigger winner in recent months. But which of these marijuana stocks is the better pick for long-term investors?

The Case for Aurora Cannabis

Are happy days here again for Aurora Cannabis? Some might think so. The Canadian cannabis producer delivered surprisingly good fiscal 2020 third-quarter results. Revenue jumped 18% from the previous quarter thanks in large part to strong demand for Aurora's Daily Special value brand.

Aurora also seems to be making progress toward profitability. The company has cut back drastically on its spending. It hopes to generate positive adjusted EBITDA in the quarter ending Sept. 30, 2020. 

After a temporary suspension in Germany, Aurora is now back in full swing in the key European medical cannabis market. At long last, Aurora is also now poised to enter the U.S. CBD market. In May, the company announced that it is acquiring Reliva, which ranks as one of the top-selling hemp-derived CBD brands in the U.S. Reliva's products are carried in more than 20,000 retail stores. 

There are reasons for optimism in Aurora's home market of Canada as well. The retail picture should improve as the Canadian economy emerges from the shadow of the COVID-19 pandemic. New retail cannabis stores are set to open in the country's most heavily populated province, Ontario.

Canada's "Cannabis 2.0" cannabis derivatives market should also continue to gain momentum. Aurora is already enjoying solid sales growth from its vapes and edibles and could see even stronger growth over the next year.

Despite its challenges over the last year, Aurora remains one of the market leaders in the Canadian cannabis industry. The company still claims an impressive production capacity. And its cost structure for cultivating cannabis is among the lowest in the industry. 

The Case for Cresco Labs

Cresco Labs doesn't just hope to generate positive adjusted EBITDA. The company has already achieved that goal for four quarters in a row. And while Cresco isn't yet profitable, it's not too hard to see how the cannabis operator could deliver a positive bottom line in the near future.

One key for Cresco to achieve profitability is to keep up its remarkable growth. In the first quarter of 2020, the company generated 60% quarter-over-quarter revenue growth. Granted, much of that increase stemmed from Cresco's acquisition of Origin House earlier this year. However, the company still managed to grow sales organically by 26% over the previous quarter.

This growth is coming in large part in two markets -- Illinois (where Cresco is headquartered) and Pennsylvania. Illinois launched its recreational marijuana market this year and has seen robust sales so far. Pennsylvania's medical cannabis market opened in 2018 and continues to pick up momentum.

Cresco's acquisition of Origin House should pave the way for growth in California, the largest legal cannabis market in the U.S. Origin House ranks as one of the largest cannabis distributors in the state and also markets its own family of cannabis brands.

Ohio seems likely to present another significant growth opportunity for Cresco. The company recently won a provisional license in the state that allows it to market its cannabis derivative products, including edibles and oils.

There are plenty of other markets in which Cresco can grow as well. The cannabis operator currently operates in nine states, but 33 states so far have legalized cannabis in some form. And with the prospects that New Jersey citizens could vote to legalize recreational marijuana in November, another major market could soon open up for Cresco.

Better Marijuana Stock

One of these stocks is growing faster than the other. It's already generating positive adjusted EBITDA. It already operates in the largest legal cannabis market in the world. And its market cap is much smaller than the other contender's market cap. In my opinion, Cresco Labs is the clear winner versus Aurora Cannabis. The choice is an easy one.

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