What's Driving Tilray Brands Inc's Surprising 104% Stock Rally?

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Tilray Brands Inc (TLRY, Financial), a prominent player in the drug manufacturers industry, has been making waves in the stock market. With a current market cap of $2.35 billion and a stock price of $3.26, the company has seen a significant surge in its stock price over the past week and three months. The past week alone saw an 8.36% gain, while the past three months witnessed a whopping 103.77% gain. According to the GF Value, a measure defined by GuruFocus.com that calculates a stock's intrinsic value using historical multiples, past performance adjustments, and future business estimates, the stock is currently fairly valued at $3.54. However, three months ago, the GF Value was $3.37, indicating that the stock was a possible value trap, urging investors to think twice before investing.

Company Overview: Tilray Brands Inc

Tilray Brands Inc is a Canadian producer that cultivates and sells medical and recreational cannabis. Following a reverse merger in 2021, legacy Aphria acquired legacy Tilray and renamed itself Tilray. The company's primary sales are in Canada and the international medical cannabis export market. It also has exposure in the U.S. through CBD products and alcohol. 1701253287396769792.png

Profitability Analysis

When it comes to profitability, Tilray has a Profitability Rank of 4/10, indicating its relative profitability within its industry. The company's Operating Margin stands at -29.11%, better than 23.67% of 1035 companies in the same industry. Its ROE and ROA are -36.11% and -28.82% respectively, better than 20.06% and 21.87% of companies in the industry. The ROIC of -4.05% is better than 35.46% of companies in the industry. Over the past 10 years, Tilray has had 3 years of profitability, better than 18.76% of 869 companies. 1701253305109315584.png

Growth Prospects

Tilray's Growth Rank is 5/10, indicating its relative growth within its industry. The company's 3-year revenue growth rate per share is -18.50%, better than 11.05% of 914 companies. However, its 5-year revenue growth rate per share is 30.00%, better than 92.7% of 794 companies. The total revenue growth rate (future 3Y to 5Y est) is 15.55%, better than 84.76% of 164 companies. The 3-year EPS without NRI growth rate is -71.00%, better than 3.77% of 822 companies. 1701253320842149888.png

Major Stock Holders

Jefferies Group (Trades, Portfolio) and Joel Greenblatt (Trades, Portfolio) are the top two holders of Tilray's stock. Jefferies Group (Trades, Portfolio) holds 850,000 shares, accounting for 0.12% of the total shares, while Joel Greenblatt (Trades, Portfolio) holds 102,637 shares, accounting for 0.01% of the total shares.

Competitive Landscape

Tilray faces stiff competition within the drug manufacturers industry. Its main competitors include Amphastar Pharmaceuticals Inc (AMPH, Financial) with a market cap of $2.51 billion, Ironwood Pharmaceuticals Inc (IRWD, Financial) with a market cap of $1.29 billion, and Pacira BioSciences Inc (PCRX, Financial) with a market cap of $1.57 billion.

Conclusion

In conclusion, Tilray Brands Inc has shown impressive stock performance, with a significant gain over the past three months. Despite its profitability and growth ranks being average, the company has shown potential with its 5-year revenue growth rate per share and total revenue growth rate (future 3Y to 5Y est). With major holders like Jefferies Group (Trades, Portfolio) and Joel Greenblatt (Trades, Portfolio) backing the company, and despite facing competition from companies like Amphastar Pharmaceuticals Inc, Ironwood Pharmaceuticals Inc, and Pacira BioSciences Inc, Tilray Brands Inc continues to hold its ground in the market.

Disclosures

I/We may personally own shares in some of the companies mentioned above. However, those positions are not material to either the company or to my/our portfolios.