Last Updated: 13 Sep 2024
Executive Summary
Tilray Inc. (TLRY) is a leading global cannabis company with a market capitalization of $1.43 billion. Despite recent headwinds, the company's fundamentals remain strong. Tilray reported revenue growth of 24.8% year-over-year in its latest quarter, driven by increased demand for its recreational and medical cannabis products. However, the company continues to face profitability challenges, with a negative profit margin and EPS.
Company Overview
Tilray is dedicated to the research, cultivation, production, and distribution of medicinal cannabis and cannabinoids. Headquartered in Canada, the company operates in several countries worldwide. Tilray's product portfolio includes dried flower, cannabis oil, and other cannabis-based products.
Fundamental Analysis
Revenue: Tilray's revenue has grown steadily in recent years, reaching $788.9 million in the trailing twelve months. The company's revenue growth is primarily driven by increased demand for its recreational and medical cannabis products.
Profitability: Tilray continues to struggle with profitability, with a negative profit margin and EPS. The company's operating expenses have been rising faster than its revenue, putting pressure on its bottom line.
Valuation: Based on the latest stock price of $1.7, Tilray trades at a price-to-sales ratio of 1.816 and a price-to-book ratio of 0.422. The company's valuation is relatively low compared to its peers.
Technical Analysis
Trend: Tilray's stock price has been trending lower in recent months. The stock is currently trading below its 50-day and 200-day moving averages.
Support and Resistance: The stock has found support at $1.50 and resistance at $2.00.
Momentum: The stock's momentum is currently negative, as indicated by the declining MACD and RSI indicators.
Short Term Outlook
In the short term, Tilray's stock is likely to remain volatile. The stock could face further downside pressure if it breaks below the $1.50 support level. However, if the stock can hold above this level, it could rebound towards the $2.00 resistance level.
Long Term Outlook
In the long term, Tilray's prospects are dependent on the growth of the global cannabis market. The company is well-positioned to benefit from this growth, given its strong brand recognition and global distribution network. However, the company will need to address its profitability challenges to unlock its full potential.
Analyst Recommendations
Analysts are mixed on Tilray's stock. One analyst has a Strong Buy rating, three have Buy ratings, eleven have Hold ratings, and none have Sell or Strong Sell ratings. The average analyst target price is $2.34, implying a potential upside of 37.6% from the current stock price.
