Why TLRY stock is surging today?

The Canadian pharmaceutical and cannabis company soared up to 8.72% due to the post-announcement of the German coalition government after its plans to legalize ‘Adult recreational cannabis. The German market is highly anticipated to grow its sales market annually by a whopping 4 billion dollars within three years of its legalization, that is latest by 2025.  

The pharmaceutical multinational giant operates in several countries along with Germany, such as – Australia, New Zealand, Portugal, Latin America, Canada, and the United States where it is currently incorporated. But Tilray is currently the market leader in German medical cannabis having an extravagant market share and it is intended to dominate and keep its market position static for the coming years as well.  

The investors seem to be quite unaware of Tilray’s current market position in Germany as the investors rushed to invest in the other cannabis companies causing their valuations to scale up disproportionately in the last 10 days but they seem to have forgotten about the Canadian pharmaceutical and cannabis company and other like companies ( Despite being the biggest German market players in the pharmaceutical and cannabis sectors) as the share price of the later are steadily plummeting over the last few days and until today as you read. And also due to the fact that the investors are aggressively investing in other companies like SynBiotic and cannovum.  

It is also believed that Tilray’s 5x 2023 forward EV/ sales multiple, while expensive, from the aforementioned para it is quite evident that the investors need to identify the opportunity and are yet to price in the German opportunity. Tilray is anticipated to spread its wings with time as it has a first-mover advantage with its leading production and distribution capacity in Germany and at the same time can leverage its domestic Canadian adult recreational cannabis expertise to the German market.  

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