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Analysis before buying or selling Tilray shares

Trade the Tilray share!

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As part of your analysis of the Tilray share price, we suggest you discover some useful information about this Canadian company. Indeed, before buying or selling this stock, you must know the activities of this group, its sources of income or its sector of activity in general. We are therefore going to give you a complete presentation of the company, including a presentation of its competitors on the market and its recent strategic partnerships. We will also provide you with some basic stock market data and explain how you can make a quality fundamental analysis of this stock by studying the most impactful publications and events.

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Information on Tilray shares
ISIN code: US88688T1007
Index or market: NASDAQ

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Elements to consider before selling or buying Tilray shares

Analysis N°1

First of all, we will pay attention to the evolution of the legislation regarding medical and recreational cannabis around the world. The more countries that allow the use of cannabis in a regulated and legal manner, the more profit companies like Tilray, already well established in the market, will be able to make.

Analysis N°2

The development of new hemp-based products by Tilray will also be important if you want to buy or sell this stock. The diversification strategy that the company is implementing in this direction can multiply its sources of income and allow it to grow.

Analysis N°3

You will need to keep an eye on the competition in this sector, which is likely to increase sharply as demand rises, with an analysis of the current main players and potential future competitors.

Analysis N°4

Finally, one should also follow the group's financial and economic results publications with the annual balance sheet and quarterly or half-yearly results as well as the targets set internally.

Analysis before buying or selling Tilray shares
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General presentation of Tilray

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We now invite you to learn a little more about the Tilray company and its economic environment. We will present to you in detail this company and its sources of income with its main activities and the various products which it markets as well as the markets on which it exercises.

The Tilray Inc group is a Canadian company specialized in the pharmaceutical sector and which more specifically offers cannabis-based products to pharmaceutical distributors. As such, the Tilray company carries out medical research on cannabis, cultivation of cannabis, and further processing and marketing of cannabis products worldwide.

Tilray also has a subsidiary called FHF Holdings Ltd which manufactures, markets and distributes consumer hemp products. Among the products in this company's portfolio are hemp heart, hemp oil, hemp granola, hemp protein powder and hemp milk. The company also markets cannabis to patients in certain countries around the world through subsidiaries located in Australia, Canada and Germany. The group's medical cannabis is produced in Canada and Europe. To date, the Tilray group employs nearly 1,646 people.

Regarding the distribution of turnover by type of product, we find at the top the sale of pure cannabis with 49.6% of turnover, the sale of hemp products for 35.8% of turnover, the sale of extracts cannabis for 14.5% of turnover and the sale of accessories and other products for 0.2% of turnover.

Finally, with regard to the geographic distribution of the group's revenues, we note that 78% comes from Canada, 14.1% from the United States and 7.9% from the rest of the world.

Photo credits: ©nikkimeel/123RF.COM

The major competitors of Tilray

We now propose to discover who are the main opponents and competitors of the Tilray Group with the main companies of this sector in the world and their activities:

Canopy Growth

This Canadian company specialises in the production and sale of medical cannabis. Recently, the group has gained size and market clout after acquiring This Works to diversify into CBD-based beauty and sleep aids. The group also acquired Supreme Cannabis in April 2021 and has now achieved a 13.6% market share in the Canadian cannabis market.

Aurora Cannabis

This Canadian company specialises in the production and sale of cannabis for both medical and recreational use. After being established following the introduction of medical marijuana regulations in Canada, the company quickly established itself as one of the leading cannabis producers in North America.

Cronos Group Inc

This cannabis company focuses primarily on research, technology and development of cannabis-related products. The group operates adult-use brands with COVE and Spinach and hemp-derived cannabidiol brands with PEACE+ and Lord Jones, which are marketed in the US and internationally. The US segment thus manages the production and sale of hemp-derived CBD-infused products, and the rest of the world segment handles the cultivation, manufacture and sale of cannabis and cannabis-derived products for the medical and recreational markets.

CV Sciences

This other company specialises in life sciences and operates in two business areas with consumer products and specialised pharmaceuticals. It produces and markets herbal supplements and hemp CBD products for various market sectors. The pharmaceutical segment specialises in the development and marketing of CBD-based therapeutic products. The group's products are currently marketed in nearly 7,300 outlets in the US and the group employs 96 people.

The major partners of Tilray

Of course, the Tilray group does not only have enemies on the market and can also count on certain strategic partnerships that allow it to maintain or grow its activity over time. Here are just a few recent examples:

AB InBev

In 2019, the Tilray group announced a strategic partnership with the Belgian-Brazilian group AB InBev which is notably the operator of the beer brands Budweiser, Stella Artois or Corona in the context of research on non-alcoholic beverages with cannabis. As part of this partnership, each of these two companies invested $ 50 million in order to develop a product for the Canadian market alone as a first step.

 Alef Biotechnology Spa 

It is a former partner of Tilray which was finally acquired in 2019 by this Canadian group. This company specializes in import and distribution. This acquisition has enabled Tilray to strengthen its positioning among the leaders in medical cannabis worldwide.

Natura Naturals

 Again, this is more of a strategic acquisition than a real partnership since Natura Naturals was acquired by Tilray in 2018. Following this transaction and the finalization of this agreement which took place 12 months after this announcement, Tilray has paid for the purchase of this subsidiary which will allow it to significantly reduce its production costs by benefiting from a supplier which is directly attached. This initiative has in fact increased Tilray's production capacities and ensured it some growth in light of the growing demand from Canadian consumers and industry.

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Positive factors for Tilray shares
The factors in favour of a rise in the Tilray share price:

Let's now take a moment to detail what the main advantages and disadvantages of Tilray stock are with its major strengths and weaknesses starting with its greatest strengths:

  • First of all, the group has numerous sales outlets in almost every state and a strong distribution network that guarantees high availability of its products for a large number of customers.
  • The group benefits from a strategically low cost structure that allows it to reduce its production costs and remain competitive in terms of the price of its products. This is achieved through automation of the various production stages and the use of a skilled and diversified workforce.
  • The financial situation of the Tilray group is also solid and stable with regular profits for several consecutive years and a significant cash flow allowing it to make investments.
  • Tilray's return on investment is also strong, allowing it to benefit from additional earnings and to make many projects profitable with a large asset base.
  • The group's marketing strategy can also be considered a strength, particularly its strong presence on social media, where it has over a million followers on the three main platforms.  The group's website is also interactive and attracts a large number of prospects and potential customers every day.
  • Tilray's particularly diverse product portfolio is another of its major strengths and allows it to offer products in a wide range of categories, some of which are not offered by the competition.
  • Tilray's geographical location is also strategically advantageous, particularly in terms of the cost of supplying its various sales outlets.
  • Finally, the Tilray group regularly sets up strategic partnerships with other companies in order to promote its production, its presence on the various markets and its innovations.
Negative factors for Tilray shares
The factors in favour of a drop in the Tilray share price:

Of course, the Tilray Group also has some weaknesses that should be known and taken into consideration before buying this stock. Here, we offer you a look at the various drawbacks of this stock and company:

  • Among the main weaknesses of the group, we can mention the fact that its stocks are important and weigh on the profitability of the group with a production sometimes too important compared to the demand.
  • The group also leases a number of its production sites rather than owning and operating them in its own name, which can generate additional costs that impact on its profitability in terms of net profits.
  • While Tilray's product portfolio is diversified, only a few products have a significant market share and a large number of other products have little market presence. This increases the group's vulnerability to external threats.
  • It should also be noted that decision-making within the group is highly centralised and team decisions have to be approved by certain officials, which makes operations less efficient and more time-consuming, leading to a decline in innovation.
  • Finally, there is the threat of competition in this sector, which is increasingly strong.
The information supplied here is only for indicative purposes and should not be used without the completion of a comprehensive and complete fundamental analysis of this asset notably taking into account exterior data, future publications and announcements and all fundamental events and news that could influence the strengths and weaknesses or make them more or less significant. This information does not in any way constitute recommendations relating to the completion of transactions or a solicitation to buy or sell an asset.

Frequently Asked Questions

How to analyze the Tilray stock and its evolution?

To effectively and conclusively analyze the Tilray share price and its likely evolution in the future, you need to set up a method based on both fundamental analysis and technical analysis of this value. It is indeed advisable to systematically compare the signals obtained by means of these two methods for more precision during your decision-making and position.

Can i buy Tilray shares in UK?

If there are few stock portfolios accessible in UK and offering the Tilray share or any other share of a Canadian company specializing in cannabis, you still have the possibility of investing in this value through online trading platforms and with CFD contracts. These contracts allow you to access almost all the equity markets in the world.

Are the Tilray group's profit and loss accounts accessible?

Like all listed companies, the Tilray group is obliged to publish its annual and quarterly financial results in a transparent manner. You will find these detailed results in the “investors” section of its website as well as on the website of your broker or any other specialized stock market news site.

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