Tilray Brands (TLRY) has garnered significant investor interest, surging more than 200% over the past three months amid optimism surrounding potential cannabis regulatory shifts and global growth opportunities. Despite this sharp rally, the $1.5 billion-capped stock minnow still appears relatively discounted.
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 55% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
However, Tilray continues to face steep losses with no clear timeline to profitability, warranting caution. Moreover, the surge appears to be fueled more by speculation than by tangible financial improvements. Given these factors, I maintain a Neutral stance until there is greater visibility into the company’s path toward sustainable profits.
The Emergence of Tilray Brands
Tilray Brands operates as a global pharmaceutical and consumer goods company focused on cannabis, alcoholic beverages, and wellness foods. The company sells medical and recreational cannabis alongside craft beer, spirits, and hemp-based products through recognizable brands including Aphria, Good Supply, SweetWater Brewery, and Manitoba Harvest.
Tilray operates in more than 20 countries, with leading positions in Canada, Germany, and Australia, alongside expanding operations in the U.S. The company is the revenue leader in Canada’s cannabis market and continues to strengthen its European footprint, recently introducing three new high-THC medical cannabis products in Germany. The broader trend is unmistakable: the cannabis industry is steadily moving from government dungeons toward full-scale commercialization, with the recreational segment on course to eclipse the medicinal market globally.
The global cannabis market is projected to reach $134.4 billion by 2030, growing at a compound annual growth rate (CAGR) of 25.5%. The U.S. represents the most significant national market, and a potential U.S. cannabis reclassification to Schedule III status would open massive opportunities for companies with existing operational infrastructure.
For TLRY, its diversified revenue streams provide stability compared to its more volatile pure-play cannabis competitors, and its beverage and wellness segments offer growth opportunities that are independent of cannabis regulatory timelines.
Mixed Financial Results
In its most recent quarterly report published in July, Tilray reported 4.1% year-over-year growth in fiscal 2025 with revenue of $821 million. Yet, the company posted a loss of $2.19 billion, primarily driven by a $1.4 billion one-time impairment charge that reflected previous asset write-downs. The overall net loss per share was $2.46, compared to a net loss of $0.33 per share in the last fiscal year.
Looking beyond the headline loss, operational metrics showed mixed results. Revenue growth varied significantly by segment. Global beverage operations grew 19% to $241 million, while wellness foods increased 9% to $60 million. International cannabis revenue jumped 71% year-over-year in Q4, with European operations (excluding Australia) jumping 112%. However, Canadian cannabis revenue declined 6% in Q4.
Despite the massive impairment charge, the company reports holding $256 million in cash after making $100 million in debt repayments during the year, which should provide adequate liquidity for operations and growth investments.
Management acknowledged competitive headwinds in core Canadian markets while expressing optimism about opportunities for European expansion and AI-driven operational improvements. The company is projecting year-over-year growth of 13% to 31% with an adjusted EBITDA of $62 million to $72 million for 2026.
Valuation & Momentum
Tilray trades at 1.76x forward sales, well below industry peers in the sector, where the average forward price-to-sales sits at 3.9x. This discount may reflect market skepticism about the company’s path to profitability, but it suggests upside potential if execution improves or regulatory changes accelerate. Market sentiment has remained elevated, as reflected in the stock’s positive price momentum, and now trades above its major moving averages.
Is TLRY a Good Stock to Buy?
On Wall Street, sentiment remains mixed. Price targets vary widely among covering analysts, reflecting disagreement about regulatory timeline assumptions and operational execution capabilities. Recent momentum has attracted speculative trading interest, but institutional investors remain cautious.
Jefferies’ Kaumil Gajrawala recently raised his price target on the shares from $1.50 to $2, while maintaining a Buy rating, noting that President Trump has recently expressed interest in rescheduling marijuana from Schedule I to Schedule III. Gajrawala also highlighted that Tilray has the brand strength, scale, and balance sheet to capture the upside.
Representing a more bearish outlook, Aaron Grey from Alliance Global Partners lowered his price target from $1 to $0.75 and kept a Neutral rating on the shares, citing concerns about potential softness in the company’s alcohol and international cannabis segments. Options activity suggests continued volatility expectations as investors position for potential regulatory catalysts while hedging against execution disappointments.
Overall, TLRY is rated a Moderate Buy based on 2 Buy and 3 Hold recommendations. The average price target is $1.03, which represents a potential downside of ~17% from current levels.
Tilray Surges on Reform Hopes as Profitability Challenges Linger
Tilray presents an interesting play on the global cannabis sector, supported by diversification into beverages and wellness products. This strategy helps mitigate pure cannabis risk while offering exposure to broader consumer markets — an advantage that could grow in importance as individual segments mature and consolidate. That said, profitability remains a key hurdle.
The stock’s recent surge reflects optimism around regulatory reform and Tilray’s expanding international footprint. Despite the sharp rally, shares still trade at a relative discount and continue to demonstrate positive momentum.
While multiple growth catalysts are in play, the company’s sizable write-down highlights the uncertainty of regulatory timelines. For now, I maintain a Neutral view, preferring to track progress in European expansion, U.S. policy developments, Canadian market share, and quarterly margin trends before revisiting the outlook.