Is Tilray Stock a buy?
Canadian grass giant Tilray (NASDAQ: TLRY) was in tears for much of 2020. Despite the stock market woes of the past week, its shares have risen nearly 60% in the past 12 months, making it one of the top performers in the industry benchmark . Horizons Marijuana Life Sciences NBIF, which returned 46% over the same period.
Investors have much to be delighted with Tilray, the most promising of which is its substantial international presence, which will be a game-changer as more countries legalize the recreational and medical use of cannabis. Let’s take a look at how Tilray can capitalize on the entry of marijuana into the mainstream.
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An exciting cannabis business
Last year, Tilray increased its revenue by 26% from 2019, reaching $ 210.5 million. It is also close to the finish line in terms of profitability. In the fourth quarter of 2020 (ended December 31), its net loss narrowed to just $ 3 million, from $ 219.8 million in the previous year’s quarter.
The company terminated a bulk cannabis supply agreement and, as a result, only managed to sell 6,901 kilograms (kg) of dried cannabis in the fourth quarter of 2020, up from 15,039 kg in the fourth quarter of 2019. brands for adults potent in tetrahydrocannabinol (THC). The net selling price of his cannabis rose to $ 5.97 per gram from $ 1.88 a year earlier. In addition, it increased its total number of stores to 1,318 from 800 a year ago.
By the end of the year, the company will merge with another Canadian cannabis producer Aphria (NASDAQ: APHA) to build the world’s largest marijuana business, with $ 658 million in combined revenue over the past 12 months. Over the next two years, the two companies could achieve up to C $ 100 million in acquisition synergies (such as the combination of corporate offices).
In addition, the two marijuana producers will have the largest market share in Canada, accounting for 17% of the total volume of cannabis sales in the country. That’s 7 percentage points higher than the next biggest main competitor, Which one is Canopy growth (NASDAQ: CGC).
Should you try Tilray?
Right now, Tilray is quite expensive, trading at 15 times revenue. Even some of the fastest growing cannabis companies, like Green thumb industries (OTC: GTBIF), Truly (OTC: TCNNF), and Curaleaf (OTC: CURLF) – are only valued between 10 and 15 times the sales. What makes Tilray special, however, is its vast international presence. The company has medical cannabis businesses in more than 17 countries.
More than half of Aphria’s C $ 160.5 million in quarterly net sales come from its distribution of cannabis to more than 13,000 pharmacies in Germany. In addition, both companies also have a significant presence in the United States. Tilray’s Manitoba subsidiary generates approximately $ 77 million annually in cannabidiol (CBD) revenue. Meanwhile, Aphria’s SweetWater Brewing subsidiary reported 2019 sales of $ 66 million and offers its products in more than 29,000 restaurants, retailers and bars nationwide.
After the merger, Tilray will offer an almost complete collection of marijuana products, including flowers, pre-rolls, oils, capsules, vapes, edibles, drinks and medical options, missing only pharmaceutical drugs based on cannabis. Given its potential to expand just about every segment of its operations internationally, this is certainly a marijuana stock you don’t want to miss it.
Here’s 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 does happen.
Cannabis legalization is sweeping across North America – 15 states plus Washington, DC, have all legalized recreational marijuana in recent years, and full legalization arrived in Canada in October 2018.
And an under-the-radar Canadian business is about to explode because of this upcoming marijuana revolution.
Because a game-changing deal has just been struck between the Government of Ontario and this mighty company … and you must hear this story today if you’ve even considered investing in pot stocks. .
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.