If you have been holding or eyeing Tilray Brands (NasdaqGS:TLRY) lately, you are probably aware of what has turbocharged the stock. The company’s shares surged after President Trump floated reclassifying marijuana as a Schedule III substance, which hints at looser restrictions and greater access for medical cannabis. This policy shift, combined with news that Tilray is joining forces with Molteni to expand deeper into Europe, signals a significant pivot for the cannabis sector and puts Tilray directly in the spotlight.
This wave of regulatory optimism and international expansion follows a challenging year in which Tilray’s stock was down more than 38% over the past twelve months, even though it spiked more than 159% in the past three months. It marks the sharpest momentum the stock has experienced in years and has outpaced many of its peers. Beyond the major headlines, Tilray also launched new products in its beverage and spirits portfolio and continues to focus on operational improvements, making this rally stand out from previous short-term increases.
With the market energized by policy changes and overseas growth, it is time to ask if this is the entry point bulls have been waiting for, or if all that excitement is already reflected in the price.
According to the community narrative, Tilray Brands is seen as overvalued by about 24% when compared to its fair value, taking into account anticipated growth, margins, dilution, and analyst price targets. This perspective is built around projected improvements in profitability, international expansion, and category diversification. However, execution risks remain.
“Tilray’s international cannabis business is achieving rapid organic growth, with European cannabis revenue up 112% year-over-year (excluding Australia) and significant share gains in Germany due to regulatory tailwinds, broader medical adoption, and expanding legalization. This supports a long runway for top-line revenue acceleration as global cannabis markets open.”
Curious about the real factors behind Tilray’s high valuation? Community analysts are relying on ambitious assumptions about growth, margins, and market strategy, which may surprise some observers. Which key numbers are driving this outlook? Explore the narrative for insights into the financial factors behind this fair value estimate.
Result: Fair Value of $0.93 (OVERVALUED)
Have a read of the narrative in full and understand what’s behind the forecasts. However, persistently slow U.S. legalization and ongoing price compression in Canada could quickly undermine the optimistic narrative around Tilray’s recovery prospects. Find out about the key risks to this Tilray Brands narrative.
While the valuation above relies on comparing price-to-sales against industry, our DCF model points to a notably different outlook. This approach considers future cash flows and currently signals a potential mismatch in market expectations. Which of these signals should investors trust?
Look into how the SWS DCF model arrives at its fair value.
Simply Wall St performs a discounted cash flow (DCF) on every stock in the world every day (check out Tilray Brands for example). We show the entire calculation in full. You can track the result in your watchlist or portfolio and be alerted when this changes, or use our stock screener to discover undervalued stocks based on their cash flows. If you save a screener we even alert you when new companies match – so you never miss a potential opportunity.
If you have your own perspective or want to dive deeper on Tilray’s story, you can quickly build your personal analysis in just a few minutes, so go ahead and do it your way.
A great starting point for your Tilray Brands research is our analysis highlighting 2 key rewards and 3 important warning signs that could impact your investment decision.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
Companies discussed in this article include TLRY.
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