Why Tilray Shares Got Smoked This Week

What happened

The Canadian Cannabis Company Stock Tilray Brands (NASDAQ:TLRY) has fallen more than 50% since the company released its fiscal third quarter results in early April. Much of that decline happened this week alone with stocks down 17.5% in the middle of the last trading day, according to data provided by S&P Global Market Intelligence.

So what

From a macro perspective, investors are fleeing growth stocks like Tilray as inflation data continues to spark fear and uncertainty. The company has told investors it has an ambitious goal of achieving annual revenue of $4 billion by mid-2024. With less than $500 million in sales for the nine months ended 28 February 2022, this objective seems more than ambitious. And with the general economic outlook increasingly murky, investors are likely starting to discount the possibility of that happening.

Now what

CEO Irwin Simon has made it clear that he wants to position his company for the potential federal legalization of marijuana in the United States. But with this potential legislation not within a realistic and visible timeline, Tilray has pivoted somewhat.

He acquired craft brewer SweetWater Brewing, Breckenridge Distillery and hemp products company Manitoba Harvest to help establish infrastructure in the United States, and he says those brands are profitable on their own. But the company has also begun to focus on its medical marijuana business in Europe and to add medical cannabinoid products in Canada.

During his fiscal third-quarter earnings conference call for investors, Simon said the European Union alone could provide $1 billion to meet his $4 billion revenue target. And the company just announced a THC-derived CBN product in Canada as a sleep aid. CBN is a cannabinol which, unlike CBD, can produce mild psychoactive reactions.

But it seems to be a pivot to look for other avenues to reach the revenue goal. And with inflation also in the mix, investors seem to be rethinking what the future holds for Tilray.

This is the marijuana stock you’ve been waiting for
A little-known Canadian company has just unlocked what some experts believe is the key to profiting from the coming marijuana boom.

And make no mistake, it’s coming.

Cannabis legalization is sweeping North America – 19 states plus Washington, DC, have all legalized recreational marijuana in the past few years, and full legalization came to Canada in October 2018.

And an under-the-radar Canadian company is about to explode because of this upcoming marijuana revolution.

Because a game-changing deal has just been struck between the Ontario government and this mighty company…and you need to hear this story today if you’ve even considered investing in pot stocks. .

Just click here to get the full story now.

Learn more

Howard Smith has positions in Tilray, Inc. The Motley Fool does not have positions in any of the stocks mentioned. The Motley Fool has a disclosure policy.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Leave a Comment