BUZZ-Aphria: Despite strong global outlook, valuation cheapest - Jefferies

(Updates with share movement)

** Jefferies starts coverage on Canadian cannabis producer Aphria Inc with ‘buy’, sets PT at C$15, shares up 9.6% at C$9.45

** U.S. listed shares of the pot firm up 10% at $9.48

** Says despite a strong global outlook, co’s valuation is the cheapest

** Sees governance-related issues, which weighed on co’s valuation, fading; a short-seller had raised questions on insider dealing

** Says co’s capacity outlook is compelling especially in extraction and that APHA’s approach to recreational cannabis has been impressive

** “Areas where Aphria is potentially trailing its closest peers are U.S. optionality and work in the space of genetics/bio-tech” - brokerage

** Says, in the United States co may do what it did in Germany - buy non-cannabis assets for leveraging at a later date

** Average rating by 12 analysts covering the stock is ‘buy’; median PT is C$15

** Toronto-listed shares up 20.6% YTD, while U.S. listed shares up 23.9% (Reporting By Arundhati Sarkar in Bengaluru)