This Week Could Be Huge for the Future of Tilray Stock

Tilray Stock Financial Report
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Tilray Stock Financial Report

Few marijuana stocks have been as disappointing as Tilray Inc (NASDAQ:TLRY).

I’ve written extensively about the malaise that has plagued the company and has sent its share prices careening downward, but it’s worth reiterating: TLRY stock has been an absolute bomb in 2019.

In fact, Tilray stock hasn’t fared well since the immediate aftermath of its initial public offering last summer.

Just take a look at the chart below, comparing Tilray and Cronos Group Inc (NASDAQ:CRON), the only other Nasdaq pure-play marijuana stock.

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Chart courtesy of StockCharts.com

It doesn’t take a trained eye to see that Tilray has been getting pummeled; the stock has fallen by more than 30% in 2019.

And, as you can see from the year-long chart below, Tilray stock has been spiraling out of control ever since it hit its high point last September.

Chart courtesy of StockCharts.com

While the early rush saw many investors reap huge rewards, Tilray shares have been on a six-month-plus downward trend that is largely in response to the wild upswing that characterized their early days on the market. And there are few signs that this downward skid will slow.

Frankly, Tilray Inc is still seen as overvalued in the eyes of many. I’m hardly the only one warning investors about TLRY stock; any other analysts have predicted a precipitous drop, with more potentially to come.

The problem is that, simply put, Tilray outgrew its ceiling. The stock went way beyond expectations in its early days and, as such, now has to pay the price with a long decline. Considering that the marijuana stock market as a whole has been on a downswing lately, you have a perfect storm for losses.

Tilray stock isn’t doomed, by any means, but it does have a long way to go before it can claw its way back into positive-yield territory.

One of the most important obstacles for Tilray is the company’s financials: they simply aren’t up to snuff when compared to those of its rivals.

That’s partially due to Tilray’s different approach to the cannabis industry, but overall, the company is lagging behind in the numbers game and that is costing it big on the stock market. Pair that trouble with standing concerns about its valuation, and you have a recipe for losses cooking.

There are ways for the company to emerge from this funk. And one is coming up today.

May 14 will see the release of the latest Tilray stock financial report. If the numbers surprise everyone, then we could see the beginnings of a small rally brewing. If, on the other hand, the report disappoints, then we’ll see even further declines in the Tilray share price.

In my mind, this quarterly report will likely be too little, too late and not radically alter the stock’s future.

I would suggest that investors don’t believe the hype, and instead stay away from TLRY stock until the company can pull its act together. There are simply way better options out there on the market right now.

Analyst Take

Today’s Tilray stock financial report is likely going to send the company’s share prices rising and falling, but ultimately, unless the earnings results are far beyond expectations, I doubt they’ll have the influence to motivate long-term gains from TLRY stock.