Why Tilray Stock Sank Today
Shares of Tilray (NASDAQ: TLRY) were sinking 9.8% lower as of 2:47 p.m. EST on Monday following an analyst downgrade of the stock. Cowen analyst Vivien Azer lowered her rating for Tilray to market perform from outperform.
What's more important than an analyst downgrade is the reasoning behind the downgrade. In this case, Vivien Azer now thinks that the challenges that faced marijuana stocks, including Tilray, in 2019 won't be resolved quickly.
In particular, Azer isn't optimistic that new retail cannabis stores will open quickly enough to boost revenue significantly in the near term. She's also concerned about pricing pressure. Consumers in the Canadian adult-use recreational marijuana market have shifted toward value brands, a move that will reduce average selling prices and hurt gross margins for cannabis producers.
Source Fool.com
