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Tilray Remains In Major Trouble

Mar. 04, 2020 1:38 PM ETTilray Brands, Inc. (TLRY), TLRY:CA20 Comments
Bill Maurer profile picture
Bill Maurer


  • Q4 results a complete disaster.
  • Financial picture getting ugly quick.
  • Single digits seem extremely likely now.

When I covered Canadian cannabis firm Tilray (NASDAQ:TLRY) a few weeks ago, I stated at the end that shares could find the single digits if there was not significant improvement in the business soon. The company's results had continued to lag expectations, and large losses were leading to massive cash burn and significant dilution. After the bell on Monday, Tilray reported its Q4 results, which confirmed that the situation is quite dire at the moment.

The highlight of the fourth quarter results from the company was that revenues surged more than 200% to nearly $47 million. This growth seems impressive, AND it also included more than $4 million in reserves for discount and returns. However, the street was looking for more than $55 million going into Monday's report, and back in August 2019, revenue expectations for this Q4 period were above $62 million.

The rest of the income statement is where things get extremely messy and quite ugly. The company wrote down more than $112 million in assets and recorded more than $68 million in inventory valuation adjustments. On a non-GAAP basis, the net loss was nearly $64 million, up from $26.5 million in the year ago period. Non-GAAP EPS came in at a loss of $0.62, missing street estimates by more than twenty cents a share, and this number was aided by ongoing dilution from multiple fronts. On a GAAP basis, the company lost more than $219 million in the period. The chart below shows just how badly this name has performed against bottom line expectations for 2019.

(Source: Q4 results and Yahoo! Finance analyst estimates page)

As I've continued to detail in past articles, Tilray's balance sheet and financing situation is where things are even worse. During Q4, the cash and investments balance dropped from $122 million to $97 million. This was despite

This article was written by

Bill Maurer profile picture
I am a market enthusiast and part-time trader. I started writing for Seeking Alpha in 2011, and it has been a tremendous opportunity and learning experience. I have been interested in the markets since elementary school, and hope to pursue a career in the investment management industry. I have been active in the markets for several years, and am primarily focused on long/short equities. I hold a Bachelor of Science Degree from Lehigh University, where I double majored in Finance and Accounting, with a minor in History. My major track focused on Investments and Financial Analysis. While at Lehigh, I was the Head Portfolio Manager of the Investment Management Group, a student group that manages three portfolios, one long/short and two long only. I have had two internships, one a summer internship at a large bank, and another helping to manage the Lehigh University Endowment for nearly a year. Disclaimer: Bill reminds investors to always do their own due diligence on any investment, and to consult their own financial adviser or representative when necessary. Any material provided is intended as general information only, and should not be considered or relied upon as a formal investment recommendation.

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Comments (20)

I think it is 95% short. please confirm.
buy the dip. TLRY will be 100 in a few years
somebody posted a few mobths ago that $TLRY would be low single digits very soon. the commenter was taken to cleaners here on SA.
Bill Maurer profile picture
@Ammar Hassan

People laughed at me in my previous article when I said I could see single digits coming.
Well. You were correct. I couldn't believe it myself back then but fundamentals were staring at all of us
its because people who smoke weeds are still the miniority. If everybody start smoking weed and you will see this skyrockets.
FranCohen profile picture
Tilray hit with Class Action derivative shareholder suit after posting 321mm net loss.

Citation: www.law360.com/...
kenpa69 profile picture
Question. Anybody know how to put stock list on my iPad BACK in alphabetical order? Very annoying, can’t find a link explaining how. I hate app changes with a passion .... any help would be appreciated, thx
this stock will be good to invest when it drops to about 1.50
Thanks for the good reports on the many companies you write on.
Anshuman_S profile picture
wow nice, good thing I never owned it
I wish I could say the same!
kenpa69 profile picture
I was lucky enough to own this before the huge run up to $300. I sold midway up that day, from my iPhone at a funeral, pocketed a cool 6K, would have doubled that had I waited a day but hey, it was the most I had ever made on one stock, in 2 days. Of course, I’m down way more than 6K on my other MJ holdings, so I’ll just continue to hold long term and hope that half of them don’t go BK on the way back up. Happy Hunting...
TrumptyDumpty profile picture
Funeral trades should be worth double.
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