Tilray Brands - did you guys see this?I couldn't have said it better myself.
Oh wait - I did say this.
"Tilray’s recent participation in a broad rally for U.S. cannabis stocks based on hopes that the DEA will quickly reschedule marijuana ignores crucial differences among weed companies and reflects a misunderstanding of the issue.
Cannabis is only 30% of Tilray’s total revenue and none is generated from US plant-touching operations. Rescheduling would not legalize the sale of marijuana for anything except FDA-approved drugs in specific forms that have been tested and approved. None of the touted financial benefits of rescheduling marijuana to Schedule III – potential tax savings, major stock exchange uplisting, implied progress toward SAFE Banking Act – help Tilray. Contrary to the sharp spike in share price, we are convinced that rescheduling Schedule III would actually be terrible for Tilray. Politicians will now focus on various policy changes that would still not allow Tilray to sell recreational cannabis products in the U.S., much less advance Tilray’s goal of using craft beer infrastructure to create THC-infused non-alcoholic beverages, all while lifting the prospects of potential competitors.
To distract investors from the stench of its cannabis business, Tilray has pursued craft beer acquisitions, recently agreeing to buy 8 brands from Anheuser-Busch. Investors cheered the move, but they might not have if management had disclosed that retail sales for key brands have declined over 20% YTD and the portfolio has only 10-15% EBITDA margins.