On July 19th, Tilray, Inc (NASDAQ:TLRY) held its IPO and opened at $17 a share. Now, the stock is trading over $120 a share. The Canadian cannabis company is based out of Nanaimo, British Columbia and engages in the research, cultivation, processing, and the distribution of medical marijuana. Tilray offers its products in 10 different countries around the world.
Canadian Cannabis Company Tilray’s Wild Week
Recreational cannabis becomes legal across Canada on October 17th, and consumable forms of cannabis will be legal at a later date. At the US federal level, marijuana is still illegal, but it is currently legal for recreational use in nine states and Washington D.C. In 31 states, medical cannabis is legal.
“The total global (cannabis) category could reach upwards of $200 billion, as suggested by Constellation Brands,” said Stifel analyst Christopher Growe.
Growe states that the value of the 22 largest marijuana companies trading in Canada has more than doubled since August 15th. Tilray is no exception to this as the stock has grown nearly 700% since its opening day. The Canadian cannabis company caught the eye of many US investors this week as its stock saw gains of nearly 80%.
Now, however, it seems investors have begun to back peddle, as the stock is dropping at alarming rates this morning.
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Hype?
The cannabis craze is looking extremely similar to the blockchain craze of 2017. Last year, investors were getting in on any stock that had to do with blockchain, purely based on hype and potential. Companies changed their names to include blockchain in the title and saw shares rise over 100% in a day.
Now, the blockchain craze is over and the stocks see minimal movement anymore. Many fear this is what cannabis stocks will do. CNBC’s Jim Cramer spoke on the “Squawk Box‘ and said, “October 17 is not going to produce the ‘high’ so to speak that people think, I don’t want people to get hurt.” Cramer says that the marijuana industry cannot compare to what the internet had to offer during the 1900s dot-com boom and bust, but investors are trading like the dot-com days.
Tilray Stock Movement
According to Yahoo Finance, TLRY is currently trading at $128.66 a share, down -$47.69 (-27.04%). This week, TLRY hit its record-high by closing out Wednesday at $251.85 a share. The stock has tumbled nearly -50% since.
Featured Image: DepositPhotos /© Petrovich99
