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Weed stocks are surging after TIlray doubles its sales



marijuanaAP Photo/Matilde

  • Tilray,
    the second-largest publicly traded marijuana company, posted
    quarterly earnings that topped expectations on
  • The stock was up more than 18% following the news, with
    other marijuana companies also rising.
  • Marijuana stocks have seen an impressive rally in
    recent months thanks to investments from major beverage

  • Follow Tilray’s stock price in real-time here.

After a brief selloff earlier in the week, shares of Tilray
— the second-largest publicly traded marijuana stock — were up
more than 17% Wednesday after the Canadian company posted
quarterly sales nearly double a year ago.

For the second quarter, Tilray reported revenue of $9.7 million —
topping an the $9.02 million was expected and up from $4.9
million a year ago. The company’s bottom line was also
better-than-expected, coming in at an adjusted loss of $0.17 per
share where Wall Street analysts had expected $0.85.

Prices per gram of cannabis roset 3% from to $6.38. The company’s
chief executive told analysts on a conference call that this
uptick was thanks to higher potency weed, but that it was also
hampered by some wholesale deals.

“The drivers of the pricing improvement is really based on mix,”
Mark Castaneda, Tilray’s chief financial officer, said on the
call. “We sold some higher-potency flower, which was a higher
percentage of the mix. We also sold some wholesale flower, which
actually brought pricing down, and also extracts was a higher
percentage in the mix as well.”

Other marijuana stocks, like Cronos
and Canopy
were also riding Tilray’s coattails Wednesday morning,
up 9% and 4%, respectively.

Tilray is now valued at $4.9 billion, despite its losses, and
could keep growing thanks to investments from major players in
other sectors, especially alcoholic beverages. Constellation
Brands — which makes Corona and Modelo, among other popular
drinks — catalyzed
a huge rally in Canopy Growth’s stock through the announcement of
two recent investments.

“We expect more alcoholic beverage companies to announce deals
with Canadian LPs over the course of the year, and view Tilray as
an attractive partner for an alcohol company looking for exposure
to cannabis,” Vivien Azer, an analyst at Cowen, said in a note to
clients on Wednesday.

Shares of Tilray are up 164% since the company’s IPO in July.

Tilray stock price earnings weed marijuana cannabis


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