Dropped by 40% in 2023, Is Tilray Brands Stock Set for an Improved Showing in 2025?
Marijuana legalization seems to be taking its sweet time, and the cannabis industry hasn't exactly been thriving as a result. Tilray Brands (TLRY) is just one of many cannabis stocks that's been struggling, with their stock price dropping over 40% this year alone and down over 90% over the past five years. With such a dismal track record, many investors are wondering if Tilray is due for a comeback in 2
However, given the current lack of excitement in the cannabis industry, it's hard to say for sure. Tilray has been attempting to diversify its operations beyond cannabis to find new growth opportunities. One such area is the beverage industry, where Tilray has made several acquisitions, including alcohol brands. By expanding into the beverage market, Tilray has been able to enter more locations in the US, potentially positioning itself better for when marijuana becomes legal in the country, although it's still unclear when or if that will happen.
However, Tilray's beverage segment has come with its own challenges, as the company's high overhead has made it difficult for them to make any meaningful progress with costs. In the second quarter of 2025, for example, Tilray reported a net loss of $34.7 million, although that was an improvement from a loss of $55.9 million a year ago.
Despite these challenges, there are still some reasons to be hopeful about Tilray's future. In their most recent quarterly results, Tilray's net revenue reached $200 million, thanks in part to a 13% increase in sales for their beverage segment. Tilray has also implemented a $25 million synergy plan for its beverage business, known as "Project 420," which aims to improve profitability and streamline operations.
However, investors should approach Tilray's stock with caution. The company's lack of profitability and underwhelming growth prospects in the cannabis industry make it a risky investment, especially when compared to other growth stocks with less risk. In fact, some analysts believe that Tilray may not even be considered a cannabis company in five years, as its operations may look significantly different due to its need to diversify.
So, while it's possible that Tilray's stock could rebound in 2025, it's unlikely to be a smooth ride. Investors should be prepared for continued volatility and uncertainly in the cannabis market, and should only consider investing in Tilray if they have a high risk tolerance and are willing to be patient. Ultimately, Tilray's success will depend on its ability to navigate the challenges of the cannabis industry and capitalize on any opportunities that arise.
Despite facing financial challenges in its beverage segment, Tilray managed to increase sales in this sector by 13% in its latest quarter, potentially positioning itself better for future marijuana legalization in the US. In an attempt to improve profitability and streamline operations, Tilray implemented a $25 million synergy plan for its beverage business, known as "Project 420."
Given Tilray's dismal track record in the cannabis industry and the uncertainty surrounding marijuana legalization, some analysts suggest that Tilray may not even be viewed as a cannabis company in five years due to its need to diversify. This diversity, however, makes Tilray's stock an risky investment with underwhelming growth prospects compared to other growth stocks with less risk.
