TDR Launches Initial Research on Tilray Brands

The TDR Three Takeaways for Tilray

  1. TDR Research launches analysis on Tilray Brands, highlighting its market leadership and revenue strength.
  2. Areas for improvement identified in cash management and operational efficiency by TDR Research.
  3. TDR Research Initiates Coverage on Tilray with a Buy Rating – One Year Target Price is “$3.28”

Today, TDR Research announced the launch of its research report on Tilray Brands (TSX: TLRY, NASDAQ: TLRY), a leader in the Canadian cannabis market. The report provides an in-depth analysis of Tilray Brands’ market position, highlighting its leadership in terms of market capitalization and revenue within the TDR Canadian Cannabis Integrated Index.

TDR Research identifies several areas where Tilray Brands could enhance its operational efficiency. The analysis points to average metrics in COGS/Revenue, SG&A, and D&A, suggesting that there is room for the company to improve its cost management. Additionally, the report raises concerns about Tilray Brands’ cash flow metrics, including Free Cash Flow (FCF) and Levered FCF, which lag behind those of peers. This underscores the need for more effective cash management strategies.

The report also notes issues with inventory and receivables performance, indicating operational inefficiencies. Significant shareholder dilution and a low TBVPS to Share Price ratio are highlighted as potential concerns for investors. Despite these challenges, TDR Research finds a low risk of earnings manipulation and a moderate financial risk for Tilray Brands.

Looking forward, TDR Research projects a 2024 revenue of $801 million for Tilray Brands, with an EBITDA of $5.6 million. The report concludes with a ‘Buy’ rating and a one-year target price of $3.28, implying a 71% return potential. This recommendation is based on the company’s solid valuation metrics, financial standing, and optimistic growth prospects.

TDR Research’s analysis of Tilray Brands reveals a company with strong market presence but also areas that require strategic attention to unlock further value. The ‘Buy’ rating underscores the confidence in the company’s ability to navigate these challenges and capitalize on its growth potential.Want to keep up to date with all of TDR’s research and news, subscribe to our daily Baked In newsletter.   

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