Tilray stock price forecast as a shooting star candle forms

Tilray stock price surged to the highest point since April last year and then pulled back after its mixed financial results. TLRY’s US shares ended the week at $1.72, down by 26% from its highest point this year. 

Tilray Brands earnings review

The main catalyst for the Tilray stock price was its first-quarter earnings, which came out stronger than expected. In a statement, the company said that its revenue rose by 5% in the quarter to $209.5 million. 

The improvement was notable as the company suffered a big sales decline in the fourth quarter. Q1’s revenue growth was mostly because of the cannabis division, whose revenue rose by 5% to $64.5 million. 

The distribution revenue rose to $74.1 million from the previous $$68.1 million. Its wellness division made $15.2 million, up from $14.8 million. 

On the other hand, the beverage revenue dropped to $55.7 million from $56 million in the same period last year. Worse, the gross margin dropped to 38% from the previous 41%.

Most importantly, Tilray Brands turned a profit in the last quarter, which was a big reversal from the $34 million loss it made in the same period last year. Its adjusted EBITDA jumped by $10 million to $3.9 million. The CEO said:

“Achieving a record Q1 net revenue of $210 million, delivering net income, and fortifying our balance sheet are not just milestones; they are proof points of our commitment to building sustainable growth, operational excellence, and unlocking value for our shareholders.”

The main reason why the Tilray stock price crashed is that the beverage unit posted a revenue decline. This is notable as the division was once seen as its growth engine, and the company has spent millions of dollars in acquisitions in the past few years. 

Cannabis rescheduling will be the next catalyst

The main catalyst for the Tilray stock price will be the cannabis rescheduling news by Donald Trump. While Trump has supported the rescheduling, he has not made the announcement formally. 

That could be a sign that the president is facing rebellion inside his party. Some Republican influencers like Tucker Carlson and the Late Charlie Kirk, have opposed the rescheduling noting that it will make America less safe. 

These risks explain why the options market is pricing in downward risk for the Tilray stock price. This is a major issue as the company has pointed to the rescheduling as the main catalyst for the stock and its business prospects.

Tilray stock price technical analysis

The daily timeframe chart shows the TLRY stock peaked at $2.32 on October 9. It formed a shooting star candle, which is made up of a small body and an upper shadow. A shooting star is one of the most popular bearish reversal patterns in technical analysis.

The Tilray stock’s Relative Strength Index (RSI) has pointed downwards in the past few days. It dropped from the overbought level of 71 to the current 58.

Therefore, the stock will likely continue falling in the near term as sellers target the next key support level at $1. A move above avoiding the resistance level at $2.32 will invalidate the bearish outlook and point to more gains.

What is clear, however, is that the stock will maintain its volatility ahead of Donald Trump’s decision on rescheduling cannabis, a move that will help Tilray expand its cannabis business to the country.

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