Cannabis Stock Spotlight: Tilray Inc. (TLRY)

Hot out of the IPO gate, Tilray Inc. (TLRY) has become one of the hottest pot stocks to own.

After pulling back from $33 to less than $22.50 after going public, TLRY exploded to a high of $116 by September 2018.  All as Canada nears approval of marijuana use in October 2018, and on very clear signs of interest from the corporate world.


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But it appears the run may have only just begun.

For one, “Tilray has a defensible competitive position as an early leader, with its partnership with Privateer offering ability to leverage established and recognizable U.S. brands,” analysts at Cowen said in an August 2018 note.

The investment bank thinks Tilray can capture about 7.6% of the Canadian cannabis market. 

Two, TLRY appeared to be in good shape at the time.

Not only does it have ample production capacity, it expected to have 912,000 sq. ft. of growing space by the close of 2018, it also had supply-agreements in British Columbia, Quebec, Manitoba, and Yukon with a medical marijuana agreement in place with Novartis. At 912,000 sq. ft., the company would be right behind Aphria Inc., which had over one million sq. ft. of growing space at the time.

Three, the company could have quite an advantage in the international cannabis market.

In 2016, the company became the first Canadian marijuana producer to export cannabis to Europe. Tilray currently exports medical marijuana to nine countries, most importantly including Germany. Many more countries could be added to the list.

According to the company’s SEC filings, it had also made agreements with pharmaceutical distributors in 12 countries, had four clinical trials in three countries and was among the first companies to have licenses for cannabis cultivation in two countries: Canada and Portugal.

And four, the company is making waves in the corporate world.

In fact, the Canadian pot producer announced it would supply marijuana to Nova Scotia Liquor. That follows news that global alcoholic drink giant Diageo is in talks with Canadian marijuana companies about investments or alliances.

TLRY also signed an agreement with the Ontario Cannabis Store (OCS).

In Ontario, Canada's most populous province, the Ontario Cannabis Store is the sole online retailer of cannabis.

In short, there’s a good amount of opportunity in TLRY. 

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