Tilray stock price target raised to $2.00 from $1.50 at Jefferies

Investing.com - Jefferies raised its price target on Tilray (NASDAQ:TLRY) to $2.00 from $1.50 while maintaining a Buy rating on the cannabis company’s stock. The stock, which has surged over 42% in the past six months and maintains a "GOOD" overall financial health score according to InvestingPro, currently appears undervalued based on Fair Value analysis.

The price target increase reflects Jefferies’ view that potential rescheduling of cannabis from Schedule I to Schedule III in the United States represents a significant federal policy shift that could benefit Tilray.

According to Jefferies, while this potential change falls short of full legalization, it marks progress as Congress reviews bills related to banking, access, and reform in the cannabis sector.

The investment firm noted that rescheduling could provide secondary benefits including lower taxes and easier research opportunities for cannabis companies.

Jefferies identified Tilray as "the biggest potential beneficiary" of these regulatory developments, while also noting that the company could face intensifying headwinds in its alcohol business. The company currently operates with a moderate debt level and maintains strong liquidity, with current assets exceeding short-term obligations by 2.46x.

In other recent news, Tilray Brands Inc. has applied for an extension to meet Nasdaq’s minimum share price requirements. The company is exploring several options to address this issue, including a potential reverse stock split that would need stockholder approval. Tilray’s share price has been trading below the $1 minimum required by Nasdaq for continued listing. Meanwhile, the company saw a significant boost in its stock price, jumping 17.7%, amid reports that President Donald Trump is considering reclassifying marijuana as a less dangerous drug. This potential regulatory change has sparked interest across the cannabis industry. Additionally, Jefferies has reiterated its Buy rating for Tilray, maintaining a price target of $1.50. This follows Tilray’s recent earnings report, which showed lower-than-expected sales due to factors like soft beer demand and delayed cannabis shipments. These developments reflect ongoing challenges and opportunities for Tilray in the evolving cannabis market.

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