Tilray management is not stupid. Just seven weeks ago Tilray decided to go public with an offering price of $17. This was done with much deliberation between them and their many bankers. With this price Citron believes they took into consideration all future deals and partnerships that the company had been planning.
The recent cannabis stock rally is a US phenomenon fueled by retail investors.
Since August 15, US marijuana stocks Tilray and Cronos have significantly outpaced the performance of their Canadian traded peers.
Due to federal regulation, US listed stocks cannot have any operations in the US without losing their listings, whereas Canadian listed stocks can have US operations. The US will be the largest cannabis market in the world. Today, the California market is over 5x larger than all of Canada. Despite obvious logic, we’ve seen US retail investors pile into the US listed marijuana stocks.
Citron sees on the trading platforms of Fidelity and Ameritrade, after Apple and Facebook, Cronos and Tilray are some of the most actively traded stocks by their customers.
Lastly, over the past week Citron has received hundreds of emails from investors ranging from anti-Semitic to threats on family, but NOT one of them could justify the price increases with any analysis whatsoever. We have been publishing for 17 years and this is generally a sign of a retail bubble.