The Tilray double-digit gains are not a fluke. Posting massive gains again today, this stock is firmly on the move. The Canadian marijuana producer marks three days in-a-row of stock increases and a 30% increase on yesterday's price.
Tilray Double-Digit Gains
Comments made by Tilray's (NASDAQ:TLRY) CEO Brendan Kennedy on CNBC, may be the cause of the continued leaping shares. Kennedy said the following in his interview with Jim Cramer yesterday:
"Cannabis is a substitute for prescription painkillers, prescription opioids, and so if you're an investor in a pharmaceutical company or you're a pharmaceutical company, you have to hedge the offset from cannabis substitution."
The CEO believes that large pharmaceutical companies should partner with cannabis producers acting as a "hedge" protecting the sector. And it seems that this idea of conglomerate cannabis/pharma global partnerships sits well with Tilray investors, as the stock surged.
Tilray stock has now tripled in value this month alone. To put some perspective on the magnitude of these gains, its competition, Canopy Growth (TSX:WEED) and GW Pharmaceuticals (NASDAQ:GWPH), rose only 3% and 2%, respectively.
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Global Partnerships
Kennedy suggested that the same business model can be applied to food and beverage companies also, as cannabis begins widening its scope.
And you only need to look at Coca-Cola (NYSE:KO) and Aurora (TSX:ACB)—companies which are in talks to develop cannabis-infused beverages—to see how partnerships in this space cause investors to react. Aurora Cannabis gained nearly 30% this week on that news alone.
Tilray
The Tilray double-digit gains make it one of Wall Street's most sought-after stocks of 2018. Tuesday's share increase marked the company's second-best day ever since its IPO. This jump came after it received approval from the Drug Enforcement Administration to import marijuana into the United States for medical research.
TLRY shares jumped 29% in the previous session with 19 million of the company's 21.7 million floating shares being traded.
Featured Image: Depositphotos/© sbotas
