UPDATE: Bernstein Starts Tilray (TLRY) at Market Perform

November 1, 2022 4:13 PM EDT
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Price: $2.50 --0%

Rating Summary:
    4 Buy, 15 Hold, 5 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 6 | Down: 3 | New: 29
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(Updated - November 1, 2022 4:17 PM EDT)

Bernstein analyst Nadine Sarwat initiates coverage on Tilray (NASDAQ: TLRY) with a Market Perform rating and a price target of $3.90.

The analyst comments "Tilray is in many ways the highest quality company in our cannabis coverage. Its portfolio is well diversified across global cannabis (37% of net sales), distribution (41%), beverage alcohol (12%) and wellness (9%). This has allowed it to weather the volatility in Canadian cannabis better than others. Its cultivation and footprint in Germany makes it the best positioned to benefit from potential German recreational legalization. Tilray's cannabis business has best-in-class gross margins, and we expect the group to be free cash flow positive this fiscal year (F23). However, like other large LPs, Tilray has suffered from meaningful share loss in Canadian cannabis, although there are now signs that this has stabilized. In the long-term, its distribution business is growth and margin dilutive. And with most of its operations in Canada or Europe, the strong USD will be a meaningful headwind in F23. Net, we believe the balance of these factors is fairly reflected in Tilray's price today. We would be more constructive if Tilray regains meaningful share in Canada and/or Germany legalizes recreational cannabis."

For an analyst ratings summary and ratings history on Tilray click here. For more ratings news on Tilray click here.

Shares of Tilray closed at $4.07 yesterday.

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