Tilray's (TLRY, $72.24) Q4 sales beat estimates, albeit with squeezed margins
Tilray Inc. experienced a loss for the fourth quarter, but had blockbuster growth in sales - thanks to a burgeoning medical marijuana market.
The Canadian pharmaceutical and marijuana company incurred a net loss of -33 cents per share for the three months ending in December, compared to a 4 cents per share profit from the same period in 2017. The company’s revenue, however, tripled to $15.5 million – beating analysts’ estimates of $14.1 million. According to Tilray, the number of kilograms of cannabis and derivative products increased nearly three-fold to 2,053, from 694 kilograms of the year-ago quarter.
Sales for the full-year 2018 surged +110% to $43.1 million.
Tilray felt a downward pressure on its fourth quarter gross margins, which at 20% were nearly a third the rate of the previous period. CEO Brendan Kennedy attributed this to increased procurement costs and taxes for medical patients, while also portending a potential future temporary headwind to margins from the company’s overseas expansion plans. But Kennedy seemed more optimistic on the long-term prospects. "Longer term, we continue to expect 50% plus gross margins as we lower our costs through greenhouse and outdoor cultivation, and as we ramp those facilities past the start-up phase," Kennedy said.
The fourth quarter saw Tilray make some major headway in business partnerships and expansion goals. The company expanded its collaboration with Sandoz (a division of Swiss drug maker Novartis) to widen the reach of medical cannabis to patients globally. Tilray also revealed plans of a research and development partnership with AB InBev, on non-alcohol THC and CBD-infused beverages – a project for which the two firms might invest up to $50 million each.
TLRY in downward trend: price dove below 50-day moving average on May 23, 2023
TLRY moved below its 50-day moving average on May 23, 2023 date and that indicates a change from an upward trend to a downward trend. In of 33 similar past instances, the stock price decreased further within the following month. The odds of a continued downward trend are .
Technical Analysis (Indicators)
Bearish Trend Analysis
The Momentum Indicator moved below the 0 level on May 18, 2023. You may want to consider selling the stock, shorting the stock, or exploring put options on TLRY as a result. In of 84 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are .
The Moving Average Convergence Divergence Histogram (MACD) for TLRY turned negative on May 16, 2023. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 46 similar instances when the indicator turned negative. In of the 46 cases the stock turned lower in the days that followed. This puts the odds of success at .
The 10-day moving average for TLRY crossed bearishly below the 50-day moving average on May 23, 2023. This indicates that the trend has shifted lower and could be considered a sell signal. In of 11 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where TLRY declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
Bullish Trend Analysis
The RSI Indicator shows that the ticker has stayed in the oversold zone for 4 days. The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an Uptrend is expected.
The Stochastic Oscillator shows that the ticker has stayed in the oversold zone for 12 days. The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an upward trend is expected.
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where TLRY advanced for three days, in of 216 cases, the price rose further within the following month. The odds of a continued upward trend are .
TLRY may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
Fundamental Analysis (Ratings)
The Tickeron Valuation Rating of (best 1 - 100 worst) indicates that the company is fair valued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (0.332) is normal, around the industry mean (42.346). P/E Ratio (8.518) is within average values for comparable stocks, (53.681). Projected Growth (PEG Ratio) (0.000) is also within normal values, averaging (2.722). TLRY has a moderately low Dividend Yield (0.000) as compared to the industry average of (0.026). P/S Ratio (1.664) is also within normal values, averaging (55.315).
The Tickeron PE Growth Rating for this company is (best 1 - 100 worst), pointing to worse than average earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.
The Tickeron Price Growth Rating for this company is (best 1 - 100 worst), indicating slightly worse than average price growth. TLRY’s price grows at a lower rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron SMR rating for this company is (best 1 - 100 worst), indicating weak sales and an unprofitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Profit vs. Risk Rating rating for this company is (best 1 - 100 worst), indicating that the returns do not compensate for the risks. TLRY’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 93, placing this stock worse than average.
Notable companies
Industry description
Market Cap
High and low price notable news
Volume
Fundamental Analysis Ratings
The average fundamental analysis ratings, where 1 is best and 100 is worst, are as follows
General Information
a holding company, whose subsidiaries engages in research, cultivation, processing and distribution of medical cannabis
Industry PharmaceuticalsOther
TLRY and
Correlation & Price change
A.I.dvisor indicates that over the last year, TLRY has been closely correlated with ACB. These tickers have moved in lockstep 79% of the time. This A.I.-generated data suggests there is a high statistical probability that if TLRY jumps, then ACB could also see price increases.
| Ticker / NAME | Correlation To TLRY | 1D Price Change % | ||
|---|---|---|---|---|
| TLRY | 100% | -1.74% | ||
| ACB - TLRY | 79% Closely correlated | -0.19% | ||
| CGC - TLRY | 78% Closely correlated | -5.10% | ||
| CRON - TLRY | 78% Closely correlated | -2.86% | ||
| SNDL - TLRY | 76% Closely correlated | -2.03% | ||
| OGI - TLRY | 69% Closely correlated | +1.88% | ||
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