Why Are Cannabis Stocks TLRY, CGC, CRON Up Today?

Following a rough first half of the year, cannabis stocks are finally enjoying some positive momentum. Key players Tilray (NASDAQ:TLRY), Canopy Growth (NASDAQ:CGC) and Cronos (NASDAQ:CRON) are finally gaining significant ground. Though the news cycle for the botanical sector was light, Tilray last week released its financial results for its fiscal year 2022, featuring some positive dynamics. Combined with legalization news from Switzerland, the industry may be rising in sympathy.

On July 28, Tilray reported that FY 2022 net revenue increased 22% to $628 million compared to the prior year. When adjusted for currency fluctuations, net revenue increased by 29%. Additionally, net sales in the fiscal fourth quarter (ended May 31, 2024) amounted to $153 million, representing year-over-year growth of 8%. On a constant currency basis, Q4 sales increased by 14% to $163 million.

In addition, management disclosed that it expects to generate $70 million to $80 million of adjusted EBITDA (earnings before interest, taxes, depreciation, and amortization). As well, it anticipates to be free cash flow positive in its operating business units in FY 2023. Thus, the leadership team believes it has a foundation set for profitable and sustainable growth.

On the international front, cannabis stocks may be responding to a Forbes article, which reported that Switzerland has now fully legalized medical cannabis and allows for exporting the historically maligned plant. Notably, from Aug. 1, Swiss patients can get medical cannabis through a prescription.