Cannabis stocks have not performed well since Canada legalized recreational use in late 2018. However, the sector did enjoy a sales uptick in March as consumers flocked to make online purchases in response to the COVID-19 lockdown. Regardless, sales appeared to normalize in the weeks that followed.

Aphria (TSX:APHA)(NYSE:APHA) defied expectations in the sector with its most recent earnings release. Shares have climbed 34% month-over-month as of close on April 20. However, the stock is still down 28% in 2020 so far.

The company reported third-quarter revenue of $144.4 million – up from $73.6 million in the prior year. Aphria’s cannabis business accounted for $55.6 million in revenue. Cash cost per gram fell below the $1 mark. Adjusted EBITDA from cannabis operations rose 78% year-over-year to $6 million.

It posted net profit of $5.7 million in Q3 and finished the quarter with $515.1 million in cash. Several industry players have struggled with liquidity, so Aphria’s strong position in this area makes it stand out. In its third quarter report, Aphria announced the suspension of its full-year outlook due to COVID-19.

The company anticipates that European measures could have a material impact on its international exports. COVID-19 lockdowns could also hurt its domestic operations in the near term.

Regardless, Aphria’s Q3 results are encouraging. The stock last had a favourable price-to-book value of 0.7. It is still trading at the low end of its 52-week range. As far as cannabis stocks go, Aphria is one of the best options among the large producers.

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