Cannabis company Tilray (NASDAQ:TLRY) is making the rounds in the media today after sharing an optimistic future outlook. Indeed, TLRY stock is up more than 12% at the time of writing as investors begin to shift their perspective on the downtrodden company.
What’s going on with Tilray lately?
Well, this morning the Canadian cannabis maker posted its fiscal third-quarter financial results. Tilray beat earnings expectations, reporting earnings per share (EPS) of 9 cents compared to the 8 cent loss analysts predicted. Unfortunately, Tilray failed to meet revenue projections. The company reported a 23% increase to $152 million in net revenue, lower than the projected $156.2 million.
Tilray operates most of its business in Canada, but has recently enjoyed the fruits of its U.S. expansion. Chief Executive Irwin Simon commented on its progress on the other side of the border, saying, “In the U.S., our SweetWater Brewing, Breckenridge Distillery, and Manitoba Harvest businesses are profitable, growing and emerging as nationwide, iconic brands with loyal followings that will be home to THC-based products upon U.S. federal legalization.”
However, Tilray’s jump in stock price today is probably due to Tilray’s future guidance.
TLRY Stock Soars on Green Expectations for 2024
According to Simon, Tilray’s current growth, combined with cannabis legalization momentum, should skyrocket the company’s revenue to $4 billion by the end of 2024. This is backed by the company’s Q3 revenue, which rose 4,000% year-over-year.
The U.S. Senate will soon vote on a marijuana decriminalization bill after it passed the house last Friday. While the bill’s prospects look slim, it’s further evidence that cannabis will likely see federal legalization sooner or later.
As such, investors are likely pricing in future U.S. marijuana legalization into Tilray’s current value. After all, the U.S. is considered one of the largest potential and current cannabis markets. Federal legalization could prove a strong bullish sign for a number of cannabis operators, including Tilray.
On the date of publication, Shrey Dua did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
