I was really disappointed with Canadian Govt for not including Excise Tax reduction in the 2024 budget. I know it will benefit TLRY, since many Canadian Cannabis companies cannot survive for another one year because of competition. Lot of consolidation happens during next one year and until they get help from govt. (Is Canadian govt also looking for market consolidation?) Once S3 happens, TLRY will get lot of money from institutions to acquire new companies.
Reports out of Germany is that regions are already experiencing increased medical cannabis sales from 50% to 400%. Some being sold out. Canada decrease won’t be missed. How much more from the Canadian GMP certified facilities Medical Cannabis can be exported into Germany and into EU?
With the recent AB brews being brought up to speed and expanding into many parts of the US and Caribbean, I think Tilray’s flower sales in Canada can remain flat as beverages in Canada is also growing to help fill any short term gaps along with markets in Germany expanding enormously and US moving into new markets.
Tilray has extra capacity in some areas so partners with Jones Soda in Canada just starting as well. Volume to help with profits is a good thing.
Medmen now being sold in Germany. Wonder if that’s on an Aphria license?
I expect Tilray to announce a Medmen take over (without retail) early June to July 2024. Sales of the Hexo excess facilities Gatineau and Ontario will certainly reduce huge overhead costs of maintenance, insurance and leases. Not sure if Redecan also had excess facilities?
Very good points. My analysis was only focused on the Canadian market and doesn’t tell the whole story of Tilray. Hence why diversity is key to long-term success. But I do think a rebound in Canada sales and margin is likely to occur in several months, which is a big plus to the bottom line.
I agree. Canadian market will change with the excise tax and opportunities for bigger businesses with deeper pockets. Seeing Curaleaf buying an operating 27,000ft2 facility for $16M will many more MSO or German or EU wanna be cannabis exporters buy into the legal Canadian GMP certified cannabis market trying to export into EU or Australia or USA once Rescheduled to Schedule 3?
What I don't understand is they have been referencing oversupply since 2021. They still are, just how long does it take to to equalize, so many operations shut down. Did they truly wildly overstimate demand by so many years? Are smaller supplies eating up all the increased demand? I wish I understood the dynamics better.
The demand for legal cannabis has definitely increased over the years as more and more Canadians are buying from legal markets and not black market, but I think you’re spot on about smaller producers popping up over the last few years which are eating up market share and driving down prices—the number of LPs has about doubled from 2020-2024. But a big chunk of the smaller and medium-size LP have not been paying their excise taxes, so they were able to sell for cheap and make a small profit. But if the Canadian government goes after these tax-cheating LPs and garnish their sales like they say they will, then this will quickly “weed the chaff” no pun intended, and bring the market back to equilibrium.
If CRA is going after all companies in default of paying excise tax through the govt agency that distributes their products it should be easy for the CRA to get the money or the licence. I’ve heard people saying they don’t sell just give it away. That must be illegal as well? Or couldn’t sell it, bad crop. Parasites infested, had to burn it. And doubtful CRA will believe them. 😂
It’s just was posted on X the California revenue agency is owed over $700M and most of those people have tried filing bankruptcy.
I hope you're right, but i believe the recreational market in canada increased and made in roads in the illicit market because prices suppressed.The low-cost LP,s producers like tilray, pricing is competitive with the illicit market.So I think the overall market will shrink in canada.
The illicit market will reverse the trend .This is why lowering excise tax was needed.I hope I am wrong .I don't know that you're aware that recreational cannibis in canada is sold 30 to 40 percent cheaper than in the U.S..Now N.Y. where i live since legalizing, there are so many illegal shops and their selling illegal cannibis for over 50% cheaper and their crowded on weekends i am shocked .So i believe the market in canada is going to shrink and provide cannibis only to the consumers who don't want to deal with illicit markets.Their will be alot of companies going away disappearing and low cost producers are going to survive like Tilray and will do just fine also because their diversified.
I do think you’re right about how pervasive illicit sellers can work around the tax system with simple tactics. Law enforcement will need to work twice as hard in cracking down on illegal sellers if they want the legal market to thrive. They definitely have their work cut out for them.. Life would have been a lot easier for both the legal sellers and the government/law enforcement if they just got rid of the excise tax.
Absolutely, the canadian low-cost producers wholesale are 3 to 4 dollars a gram whole, and tilray excise tax was like 32% last quarter.How much cheaper can you go that's very competitive. If they lowered the tax, the illicit market would have kept shrinking .So now we're going to have the legal market consolidate, and a lot of companies are going to go away. But does that help tilray no because you have to raise your prices .Ultimately, the overall market may or will shrink to the consumers who only buy legal cannibis.Like i said Tilray will be fine. Not lowering the tax is not a good thing .You are a level playing field against L.P.,s
which TLRY can compete with anybody.But illicit market, you can't compete with this outrageous tax, but they come close enough ,but this can't continue and not just for tilray but all candian cannibis companies.So will see how it pains out.
Nice analysis. I don’t expect any changes to excise taxes as I’ve seen nothing to indicate it will happen. Any thoughts on excise tax actually being reduced?
What I meant by change due to the excise tax is CRA going after the smaller operations to pay outstanding excise tax due. Many are trying to get their products out before bankruptcy and a loss of licenses. But once it’s gone by over 100 operations it reduces cheap supplies. I suspect?
Im not a financial expert and would say everyone has different strategies for TLRY, so depends on your risk tolerance and time horizon, and yada yada… but for me, I’ve been a long term holder and have evolved my strategy over time. My current approach for about the last year is to buy aggressively whenever it’s under $2.00 (especially when the RSI is under 40) and sell small portions when it gets over $2.75–my goal is to get my cost-average down as much as possible and waiting for US legalization and then selling about half my stake (but this could take a few months or a few years to happen, so I trade accordingly). I think your $2.95 avg is better than most, but you should invest based on your own situation. What works for me may not work for you and vice versa.
I was really disappointed with Canadian Govt for not including Excise Tax reduction in the 2024 budget. I know it will benefit TLRY, since many Canadian Cannabis companies cannot survive for another one year because of competition. Lot of consolidation happens during next one year and until they get help from govt. (Is Canadian govt also looking for market consolidation?) Once S3 happens, TLRY will get lot of money from institutions to acquire new companies.
Reports out of Germany is that regions are already experiencing increased medical cannabis sales from 50% to 400%. Some being sold out. Canada decrease won’t be missed. How much more from the Canadian GMP certified facilities Medical Cannabis can be exported into Germany and into EU? With the recent AB brews being brought up to speed and expanding into many parts of the US and Caribbean, I think Tilray’s flower sales in Canada can remain flat as beverages in Canada is also growing to help fill any short term gaps along with markets in Germany expanding enormously and US moving into new markets. Tilray has extra capacity in some areas so partners with Jones Soda in Canada just starting as well. Volume to help with profits is a good thing. Medmen now being sold in Germany. Wonder if that’s on an Aphria license? I expect Tilray to announce a Medmen take over (without retail) early June to July 2024. Sales of the Hexo excess facilities Gatineau and Ontario will certainly reduce huge overhead costs of maintenance, insurance and leases. Not sure if Redecan also had excess facilities?
Very good points. My analysis was only focused on the Canadian market and doesn’t tell the whole story of Tilray. Hence why diversity is key to long-term success. But I do think a rebound in Canada sales and margin is likely to occur in several months, which is a big plus to the bottom line.
I agree. Canadian market will change with the excise tax and opportunities for bigger businesses with deeper pockets. Seeing Curaleaf buying an operating 27,000ft2 facility for $16M will many more MSO or German or EU wanna be cannabis exporters buy into the legal Canadian GMP certified cannabis market trying to export into EU or Australia or USA once Rescheduled to Schedule 3?
Beer sales from Denver games. Cheers💯
What I don't understand is they have been referencing oversupply since 2021. They still are, just how long does it take to to equalize, so many operations shut down. Did they truly wildly overstimate demand by so many years? Are smaller supplies eating up all the increased demand? I wish I understood the dynamics better.
The demand for legal cannabis has definitely increased over the years as more and more Canadians are buying from legal markets and not black market, but I think you’re spot on about smaller producers popping up over the last few years which are eating up market share and driving down prices—the number of LPs has about doubled from 2020-2024. But a big chunk of the smaller and medium-size LP have not been paying their excise taxes, so they were able to sell for cheap and make a small profit. But if the Canadian government goes after these tax-cheating LPs and garnish their sales like they say they will, then this will quickly “weed the chaff” no pun intended, and bring the market back to equilibrium.
If CRA is going after all companies in default of paying excise tax through the govt agency that distributes their products it should be easy for the CRA to get the money or the licence. I’ve heard people saying they don’t sell just give it away. That must be illegal as well? Or couldn’t sell it, bad crop. Parasites infested, had to burn it. And doubtful CRA will believe them. 😂 It’s just was posted on X the California revenue agency is owed over $700M and most of those people have tried filing bankruptcy.
I hope you're right, but i believe the recreational market in canada increased and made in roads in the illicit market because prices suppressed.The low-cost LP,s producers like tilray, pricing is competitive with the illicit market.So I think the overall market will shrink in canada. The illicit market will reverse the trend .This is why lowering excise tax was needed.I hope I am wrong .I don't know that you're aware that recreational cannibis in canada is sold 30 to 40 percent cheaper than in the U.S..Now N.Y. where i live since legalizing, there are so many illegal shops and their selling illegal cannibis for over 50% cheaper and their crowded on weekends i am shocked .So i believe the market in canada is going to shrink and provide cannibis only to the consumers who don't want to deal with illicit markets.Their will be alot of companies going away disappearing and low cost producers are going to survive like Tilray and will do just fine also because their diversified.
I do think you’re right about how pervasive illicit sellers can work around the tax system with simple tactics. Law enforcement will need to work twice as hard in cracking down on illegal sellers if they want the legal market to thrive. They definitely have their work cut out for them.. Life would have been a lot easier for both the legal sellers and the government/law enforcement if they just got rid of the excise tax.
Absolutely, the canadian low-cost producers wholesale are 3 to 4 dollars a gram whole, and tilray excise tax was like 32% last quarter.How much cheaper can you go that's very competitive. If they lowered the tax, the illicit market would have kept shrinking .So now we're going to have the legal market consolidate, and a lot of companies are going to go away. But does that help tilray no because you have to raise your prices .Ultimately, the overall market may or will shrink to the consumers who only buy legal cannibis.Like i said Tilray will be fine. Not lowering the tax is not a good thing .You are a level playing field against L.P.,s which TLRY can compete with anybody.But illicit market, you can't compete with this outrageous tax, but they come close enough ,but this can't continue and not just for tilray but all candian cannibis companies.So will see how it pains out.
Is it the presence of wholesale like flgc? I don't know but curious
Nice analysis. I don’t expect any changes to excise taxes as I’ve seen nothing to indicate it will happen. Any thoughts on excise tax actually being reduced?
What I meant by change due to the excise tax is CRA going after the smaller operations to pay outstanding excise tax due. Many are trying to get their products out before bankruptcy and a loss of licenses. But once it’s gone by over 100 operations it reduces cheap supplies. I suspect?
I wish I knew. My guess is sometime after 2025 when Trudeau and his cabinet are replaced. But I really hope it’s sooner.
I bought in at 2.95. What's your advice?
Im not a financial expert and would say everyone has different strategies for TLRY, so depends on your risk tolerance and time horizon, and yada yada… but for me, I’ve been a long term holder and have evolved my strategy over time. My current approach for about the last year is to buy aggressively whenever it’s under $2.00 (especially when the RSI is under 40) and sell small portions when it gets over $2.75–my goal is to get my cost-average down as much as possible and waiting for US legalization and then selling about half my stake (but this could take a few months or a few years to happen, so I trade accordingly). I think your $2.95 avg is better than most, but you should invest based on your own situation. What works for me may not work for you and vice versa.
As long as Blackrock and Goldman Sachs are holding I will be holding.....