Shares in Canadian pharmaceutical and cannabis company Tilray (TLRY) plunged 10% in Monday’s after-hours trading on mixed second quarter earning results. The stock had climbed 7% during the day in the build up to the print.Specifically, Q2 GAAP EPS of -$0.66 missed Street expectations by $0.39. Meanwhile revenue of $50.4M missed by $4.59M (despite rising 10% year-over-year) due primarily to challenges in the Canadian Recreational market. Revenue declined 3% sequentially from Q1 driven by the impact of COVID-19 and a limited number of retail store additions in Q2.“With our significant cost cutting and balance sheet actions behind us, we have positioned Tilray to enter the second half of 2020 in a stronger position so we can remain focused on achieving profitable growth in all our markets and deliver break-even or positive Adjusted EBITDA in the fourth quarter of 2020” commented Brendan Kennedy, Tilray’s CEO.On the positive side, an adjusted EBITDA loss of $12.3M (vs. an $18.0M loss in the prior year) came in ahead of Street expectations for a $14.6M loss. Total cannabis kg equivalents sold also surged 105% year-over-year to 11,430 kgs.Notably, Q2 International Medical revenue increased 349% to $8.3M from $1.9M in the prior year, up from a 220% increase in Q1. Revenue growth for the other cannabis segments was as follows: Canada Medical +65%, Adult Use +17%, and Bulk -94%. (See TLRY stock analysis on TipRanks).Following the results Oppenheimer analyst Rupesh Parikh reiterated his hold rating without a price target. “The company continues to drive strong growth in international medical, but the performance in Canada remains a key focal point for us going forward… [we] continue to model an adjusted EBITDA loss in Q4 primarily driven by the difficult competitive backdrop in Canada” he explained.Overall the stock scores a cautious Hold analyst consensus with 6 recent hold ratings vs just 1 buy rating. The average analyst price target of $9 indicates upside potential of 9%, with shares currently down 53% year-to-date. As MKM Partners analyst Bill Kirk writes, “The sooner Tilray can derive the majority of its sales from Europe with product grown in Portugal, the better.”Related News: Amarin’s Vascepa To Take Part In Covid-19 Study In Adults With Heart Disease Regeneron Prices $1.25B Public Offering; Analyst Cautious On Valuation Eli Lilly, Innovent Deliver Encouraging Lung Cancer Data For Sintilimab More recent articles from Smarter Analyst: * American Airlines Shares Lifted By Air Travel Demand Data * Walmart vs Target: Which Retailer is the Better Buy? * RBC Raises TripAdvisor’s PT On Improving Demand Outlook * Inovio To Start Phase 2/3 Study Of Covid-19 Candidate In Sept.; Shares Drop 8%
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