Post by
geodcan on Jan 11, 2024 4:10pm
fomo and forgot about the right-sizing
a long time lurker and recent and now underwater investor in TLRY, I broke my own rules, again.
I listened to a good portion of the recent interview and Irwin sold it pretty well.
But, the general state of affairs with the pot business in North America is too much supply and too many players that is hampering shareprice appreciation.
Dealing with supply and demand is going to create a "FUGLY" environment and I want to think that Tilray will still be standing after the attrition.
Compound that with the black market, Cartels and Bikers who are probably over 50% of the market in the US and the fact that their costs and no taxes to operate in the black market are really a well-stacked deck that has them at a clear advantage to the legal operations and increases their survivorship potential over those trying to be the new vice industry.
Companies in trouble financially try to generate enough revenue to keep the lights on by dropping prices of skus in the hopes that they can drive the competition out.
Some form of legalization in the US at the Federal level could be the turnaround and launch the biggest greenrush the world is going to see, at least for the cream of the crop potpreneurs, but doesn't solve the problem of too much supply eroding profit potential and too many potpreneurs jumping in when they really shouldn't have.
A quick glance at the chart and Tilray has dropped from over $200 per share to less than $3, sort of on par with Canopy Growth with one difference, I think. Canopy is in the hands of marketmakers who could also be major shareholders and financiers and their management isn't as convincing as Irwin is. Canopy is promising a bright future but then do a consolidation (castration) of shareholder's shares which runs contrary to their mission of convincing shareholders of their intentions to fix a broken company.
I don't think Tilray is that dire yet and seem to be diversifying to beer and alcohol, possibly for rapid setup on US soil, if the legals get fixed.
Canopy's major shareholder is Constellation Brands a US based company with International business who have a deal with Acreage Holdings, a US MSO that apparently has undergone the same kind of leaning out for profitability that will be the segway for Canopy to put down roots on US soil.
Tilray is quietly setting up using loopholes or taking advantage of legal wranglings to get a toehold in the US also.
They are both considered Canadian LPs and are both a threat to US MSOs and the protectionism that they weild in their sheaths.
In all fairness, MSOs have lagged LPs but are also showing signs of a downturn in shareprice that might morph into a full blown correction for pot stocks that may syncronize with the pullback that I sense is coming because of high interest rates across the whole marketplace.
Not a straightline for sure!
glta and dyodd