This analyst just chopped his price target on Tilray

Haywood Securities analyst Neal Gilmer says Tilray Brands (Tilray Brands Stock Quote, Chart, News, Analysts, Financials TSX:TLRY,) still needs to show clearer organic revenue growth and improving cash flow generation.

In a July 29 update, Gilmer maintained his “Hold” rating on Tilray and lowered his target to $5.00 from $7.40, based on 0.6 times his fiscal 2028 EV/revenue estimate, discounted at 15%,.

Tilray reported Q4 fiscal 2026 revenue of $281.7-million and Adjusted EBITDA of $31.9-million, compared with Gilmer’s estimates of $236.0-million and $32.2-million. Consensus was $246.3-million and $32.3-million.

The revenue beat was largely driven by the unexpected inclusion of about $51-million from the BrewDog acquisition, which Gilmer had not expected to contribute in fiscal 2026.

Total revenue was up 25.5% year-over-year and 36.3% sequentially. Adjusted gross margin was 32.1%, up from 30.1% a year earlier and above Gilmer’s 30.8% forecast.

Cash used in operations was $37.3-million, mainly because of working capital changes and the inclusion of BrewDog. Tilray ended the quarter with $234.6-million of cash, restricted cash and marketable securities, and $226.9-million of debt.

Tilray’s beverage alcohol revenue rose 60.9% year-over-year, helped by BrewDog, while adjusted gross margin in the segment was 38.4%.

Cannabis revenue increased 5.4% to $71.5-million, driven by 21.8% growth in international sales, partly offset by slightly lower adult-use sales and declines in medical and wholesale revenue.

Management guided for fiscal 2027 Adjusted EBITDA of $68-million to $75-million, representing 17% growth at the midpoint.

“However, we remain cautious on the overall organic growth the Company has been able to achieve on a consistent basis but recognize the diversification of its business segments,” Gilmer said. “While the BrewDog acquisition broadens Tilray’s presence it comes with initially lower EBITDA margins.”

The analyst expects Tilray will generate Adjusted EBITDA of $68.3-million on revenue of $1.16-billion in fiscal 2027, improving to Adjusted EBITDA of $73.4-million on revenue of $1.20-billion in fiscal 2028.

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