This analyst just chopped his price target on Tilray

In an April 2 report, Haywood analyst Neal Gilmer cut his target on Tilray Brands (Tilray Brands Stock Quote, Chart, News, Analysts, Financials NASDAQ:TLRY) to $7.40 from $10.50 and maintained his “Hold” rating after third-quarter fiscal 2026 results that came in broadly in line with expectations.

He said Tilray remains a significant player in Canadian cannabis with international and beverage opportunities, but added that he remains cautious on the company’s ability to deliver consistent organic growth and stronger cash flow.

Gilmer said Tilray’s diversification remains a positive, though the BrewDog acquisition, now reflected in his fiscal 2027 estimates, comes with lower initial EBITDA margins. He said his new $7.40 target is based on 0.85x projected fiscal 2027 EV/Revenue, down from 1.4x previously, discounted by 15%.

Tilray reported third-quarter revenue of $206.7-million and Adjusted EBITDA of $10.7-million, compared with Gilmer’s estimates of $202.0-million and $11.6-million, and consensus forecasts of $201.3-million and $10.8-million. Revenue rose 11.3% year over year but fell 5.0% sequentially. Adjusted gross margin was 26.6%, slightly below Gilmer’s 27.3% estimate and down from 28.0% a year earlier.

The cannabis segment remained the main source of growth, with net cannabis revenue rising 19.4% to $64.8-million, driven by a 73% increase in international sales and a modest gain in adult-use revenue. Medical sales were relatively flat and wholesale revenue declined. In beverage and alcohol, revenue fell 23.9% year over year as the company continued to face craft beer weakness and portfolio optimization under Project 420. Segment adjusted gross margin declined to 31.9% from 35.8%, though management said this likely marks the trough.

Tilray said Project 420 has now been completed and is expected to deliver about $33-million in annualized cost savings. Cash used in operations was $21.9-million, largely due to working capital changes, while cash from operations excluding those changes was $3.2-million. The company ended the quarter with about $264.8-million in cash, restricted cash and marketable securities, against debt of $249.5-million.

Management reiterated fiscal 2026 guidance for Adjusted EBITDA of $62-million to $72-million, implying 13 to 31% growth from fiscal 2025.

Gilmer said he now expects Tilray to generate $61.4-million in Adjusted EBITDA on revenue of $869.7-million in fiscal 2026, improving to $81.1-million in Adjusted EBITDA on revenue of $1.15-billion in fiscal 2027.

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