Published: Fri, September 21, 2018
Economy | By

Tilray shows the highs, lows of investing in pot

Tilray shows the highs, lows of investing in pot

The company also got a boost this week when the U.S. Drug Enforcement Administration gave it the green light to import medical marijuana for a clinical trial in California.

It's reefer madness for Nanaimo-based Tilray Inc., which is now the most valuable cannabis company of its kind in the world. The one-year trial is scheduled to begin in 2019.

The stock is up another 40% in pre-market trading Wednesday after CEO Brendan Kennedy appeared on CNBC's "Mad Money" Tuesday evening.

Tilray Inc. shares shot up over US$235 in trading Wednesday on the New York Nasdaq. The move also puts Tilray in a better competitive position against peer Canopy Growth Corp., which has 39 USA patents and 15 clinical trials, said Azer, who rates both stocks outperform.

"(The) news is a positive for both TLRY and the broader cannabis stock universe, as additional medical applications and improved government support add another domino to future legalization in the USA", she said in a note on Tuesday.

The news signals yet "another encouraging sign of improved government support for cannabis research", Cowen analyst Vivien Azer writes in a note, and the increased medical applications "add another domino to future legalization in the U.S".

The licensed producer's market capitalization was roughly US$19.9 billion at close.

As of Tuesday's close, Tilray was worth $14.44 in book value, compared to Canopy Growth's $10.91, thanks to its more than 800% gain since its July initial public offering.

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