legal marijuana sales are expected to make up more than half of this total at nearly $100 billion per year by the end of the decade, according to the marijuana research firm Research and Markets.
and European Union, overly aggressive expansion plans by the industry’s biggest names, never-ending capital raises at shareholders’ expense, white-hot levels of competition from both legal and black-market growers alike, and an ongoing shift in consumer dynamics have all acted in concert to crush valuations across the space.
Last year, Canadian cannabis titans Aphria and Tilray Brands struck multiple high-dollar deals to shore up its position in its domestic market of Canada and prepare for an eventual dive into the U.S.
Most industry insiders, however, agree that a lot more deals — especially in the hotly contested Canadian market — will be required to improve free cash flows, gross margins, and the overall investability of legal marijuana as a whole.
While President Biden has signaled a willingness to consider increasing access to the plant for research purposes and enacting reforms on the criminal-penalty aspects of cannabis, full-scale legalization doesn’t appear to be in the cards on his watch.
sales under one roof by the next fiscal year, significantly lower white-market competition in Canada, and give the newly formed entity far greater pricing power in its domestic market.
The rationale for such a merger is further supported by the fact that Aurora, Canopy, and Tilray don’t have the type of rock-solid fundamentals to mount a comeback in this moody market as standalone entities.
Tilray is attempting to rebrand itself as a global consumer-goods company in the eyes of investors, and Canopy seems committed to its U.S.