Marijuana stocks are on fire, and growth in the legal weed industry certainly has the attention of investors.

According to cannabis research firm ArcView, legal pot sales in North America jumped 34% in 2016 to a record $6.9 billion. Per ArcView, sales of legal weed could grow to reach more than $22 billion by 2021. A similar bullish sentiment is shared by investment firm Cowen & Co., which believes legal marijuana sales could hit $50 billion by 2026. With ArcView estimating that $46.4 billion in cannabis sales last year came from the black market, there's ample reason to believe that legal channels can lure in these under-the-table consumers in the years to come.

There are dozens of marijuana stocks that investors can choose from. But with emotions running high, investors may be buying into pot stocks for all the wrong reasons, or worse yet, without understanding the risks they may deal with by buying into incredibly volatile marijuana stocks.

With this in mind, we're going to take the time to analyze one marijuana stock each week until all of the bigger legal weed players have been covered (i.e., those with market caps of $200 million or more). Here are the companies we've discussed so far:

• GW Pharmaceuticals
• Insys Therapeutics
• Aphria (NASDAQOTH:APHQF)

Today, we're going to take a closer look at Aurora Cannabis (NASDAQOTH:ACBFF).

What Aurora Cannabis does

Aurora Cannabis is a licensed producer and retailer of medical marijuana in Canada, with the company citing approximately 12,800 active registered patients as of its second-quarter earnings report in late February. As a reminder, Canada legalized the use of medical cannabis for patients all the way back in 2001, so it's had an established medical weed industry for more than a decade.

Currently, Aurora Cannabis' lone producing facility is a 55,200 square foot facility in Mountain View County, Alberta. However, as we'll discuss in a few moments, it has two additional grow facilities in the works.

IMAGE SOURCE: GETTY IMAGES.

Promise and opportunities

Prime Minister Justin Trudeau has been campaigning for the legalization of recreational marijuana for years, and it appears 2017 may finally be the year when legislation passes to make this a reality. If Canada's government agrees, weed could be legal throughout Canada, as opposed to certain cities and locales, by sometime in 2018.

Aurora Cannabis has been very clear that it intends to shift some of its production to the rapidly growing recreational side of the equation if Canada's maple leaf turns green in the months to come. For added context, the Canadian government has estimated that recreational weed could add $5 billion to $7 billion in revenue per year.

Secondly, and as alluded to above, Aurora Cannabis has a number of key projects underway that could see its production expand at just the right time. It completed the acquisition of a 40,000 square foot facility from Peloton Pharmaceuticals one month ago, and the facility, which was in the late stages of construction when purchased, should be capable of up to 3,900 kg of high-quality cannabis production by the second half of this year.

More importantly on the expansion front, Aurora Cannabis is constructing the Aurora Sky, an 800,000 square foot facility that it claims will be the largest and most technologically advanced cannabis production facility in the world. At full capacity, it's expected to generate 100,000 kg of cannabis a year! Aurora Sky could be completed as early as late 2017.

We're also beginning to see improvements in the company's operating results, despite most of its production having not yet come online. The company's second-quarter results showed a 27% increase in sequential quarterly sales from the first quarter, as well as a halving of its net loss, and a better than doubling in working capital. Long story short, sales are on the rise, losses are shrinking, and Aurora has plenty of working capital to complete its audacious Aurora Sky project.