Tilray Stock Hits Annual Lows Ahead of Earnings Report

The equity received a price-target cut from Haywood Securities today

Deputy Editor
Jan 6, 2022 at 12:40 PM
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Marijuana producer Tilray Inc (NASDAQ:TLRY) is gearing up for its fiscal second-quarter earnings report, which is due out before the open on Monday, Jan. 10. The eternally struggling stock is sinking even deeper ahead of the event, with a brief attempt at a rally rejected by the 140-day moving average back in November. Since then the shares have been pressured lower by the 10-day moving average, and today TLRY is trading at its lowest level in over a year, last seen down 0.6% at $6.59. 

tlry chart jan 6

A price-target cut from Haywood Securities may be weighing on the stock today. The analyst slashed its objective to $8 from $12.50. The 12-month consensus price target of $11.44 is still a lofty 75.2% premium to current level, however, which could mean more bear notes right on the horizon. 

If Tilray's post-earnings past is any indicator, these downgrades may happen sooner rather than later. The security has settled lower the session following six of its last eight reports, and though it did score a 25.8% pop after its August report, it also suffered a 17.5% drop in November 2020. The security has averaged a 12.3% next-day swing, regardless of direction, which is slightly smaller than the 15.4% move the options pits are pricing in this time around. 

Despite its recent lows, Tilray options bulls have been busy. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), the stock sports a 50-day call/put volume ratio of 6.93, which stands higher than 92% of annual readings. This implies that long puts have rarely been more popular in the past year. 

Short sellers, on the other hand, have been circling the stock in droves. Short interest rose 23.1% in the last two reporting periods, and the 51.04 million shares sold short make up a hefty 11.5% of the stock's available float. 

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