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Should You Buy the Dip in Tilray? -Breaking

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© Reuters. Are You a Tilrayan?

Canada-based cannabis producer Tilray’s (TLRY) acquisition strategy could drive its long-term growth. However, the company’s shares have fallen in price significantly over the past six months. Investors have been hesitant to invest in pot stocks due to uncertainty surrounding decriminalization. Furthermore, considering TLRY’s weak bottom line, is the stock a buy in the recent dip? Continue reading. Tilray, Inc., a Canadian-based cannabis producer, is a researcher, grower, marketer, and distributor of medical marijuana products. To strengthen its international presence, the company executed several notable mergers in this year. Aphria, which it acquired (NASDAQ:), is likely to boost its growth. It plans to establish a cannabis-focused company that sells consumer packaged goods (CPG) with the greatest global footprint. TLRY also acquired a large portion of MedMen Enterprises’ (OTC) Inc.’s senior secured convertible notes in summer. This is a top American marijuana retailer.

TLRY has made recent purchases that should be beneficial, given the fact that a new Congressional Republican-led bill for marijuana legalization was introduced in Congress. Representative Nancy Mace (Republican from SC) recently introduced a bill that would decriminalize cannabis. This was supported by a large majority of Americans. TLRY could expand its reach in the U.S. and increase its operational capability if it is allowed to open fully. Still, things move slowly, so it might take some time until TLRY is able to capture a bigger market share. Also, the company’s weak bottom line is a concern. Also, Barclays (LON.) Analysts have pointed out that it is unlikely the legislation will be implemented under the Biden administration. Barclays stated also that Canadian cannabis businesses would be unable to compete against multistate U.S. operators.

TLRY’s stock performance over the past six months has been sluggish. The stock’s share price has fallen significantly in the last six months. The stock trades below its 200-day and 50-day moving averages. Stock prices also fell last week. Due to uncertainty surrounding legalization at the Federal level, investors are avoiding pot stocks. The stock also has a beta of 1.52, which indicates high volatility.

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