Tilray stock is in the green today with Tilray Inc (NASDAQ:TLRY) set to report its third-quarter earnings at the close of trading next Tuesday, November 12. Can those earnings drive further growth for the battered pot stock?
A Dismissal Year for Tilray Stock
Tilray stock made history last year when it became the first pot stock to list on a major US exchange but has taken a bruising in the first year of legal pot, losing as much as 90% of its value from a peak of $214 USD in September 2018. That dismissal performance prompted analysts to slash their price targets for Tilray with the company’s biggest bull, Vivien Azer of Cowen & Co, reducing her outlook from $150 down to $60.
However, Azer maintained that Tilray stock was still outperforming the broader market and that the company had made positive moves to deal with the issues facing dragging it down. With Tilray’s latest earnings just under a week away, other analysts aren’t feeling as bullish as Azer. The consensus estimate is that Tilray will post earnings per share of -$0.29, which represents a decline of 262% from the same period last year.
Aggressive Expansion Strategy
Revenue is expected to come in at $50.26 million USD, a 400% increase from Q3 2018. The company expects to turn profitable in the next quarter or two, driven largely by an aggressive expansion strategy. In February 2019, Tilray Inc acquired Manitoba Harvest, the world’s largest hemp foods manufacturer, for $317 million USD from Compass Diversified Holdings. This gives the company a significant foothold in the booming CBD industry, with access to 16,000 retail locations, and could be a huge growth factor for Tilray stock.
One sign of hope for Tilray stock is the increased positions of several institutional investors. Wealthcare Advisory Partners LLC doubled its stake in Tilray during Q3 after buying an additional $25,000 USD worth of stock, while Certified Advisory Corp increased its holding by over 150%, acquiring an extra 628 shares. While these increased positions may just be purely speculative, they could also be a sign of better days ahead for Tilray.
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