Tilray Inc (NASDAQ: TLRY) ended about 20% down on Friday after the cannabis company reported weaker-than-expected results for its fiscal first quarter.
President Biden pardons marijuana convicts
For a long-term investor, though, news from a day earlier is perhaps more noteworthy.
On Thursday, President Biden pardoned roughly 6,500 U.S. citizens convicted of “simple marijuana possession”. Reacting to it on CNBC’s “Closing Bell”, Irwin Simon – the Chief Executive of Tilray Inc said:
It’s a really big deal, we’ve all been waiting for this. It is a great step in the right direction. There’s still a lot of wood to chop before we get to full legalisation, but it’s important to know that it’s on the agenda.
As much as 60% of Americans, he added, want authorities to legalise cannabis in the United States.
Classification of marijuana to be reviewed
President Biden also ordered a review of how marijuana is classified. Currently, it’s classified the same as “heroin” on the federal level, which, he noted, “makes no sense”.
There’s a lot of investors that want to see something happen here. Institutions want to be investing in this without the SAFE Banking Act. Demand for cannabis is tremendous.
Versus their year-to-date high, “TLRY” are now down about 65%. It may be a good idea to buy Tilray shares on the weakness considering the Wall Street has an average price target of $4.50 on this stock that represents about a 50% upside from here.
Notable figures in Tilray Q1 financial results
- Lost $65.8 million versus the year-ago $34.6 million
- Per-share loss climbed from 8 cents to 13 cents
- Revenue sunk 9.0% year-on-year to $153.2 million
- Consensus was 7 cents loss on $155.9 million revenue
- Cannabis gross margin went up 800 basis points to 51%
- Ended the quarter with roughly $500 million in cash
Tilray grew its share 8.5% this quarter to remain the top most cannabis company in Canada, as per the earnings press release. CEO Simon added:
We’re well-positioned once cannabis legalises in the United States to come in here and make a major play because of our balance sheet and know how.
The post Tilray reports a weak Q1 but gets good news from President Biden appeared first on Invezz.