Penny stock Tilray (NASDAQ:TLRY)(TSE:TLRY) is up about 12.6% in the pre-market session. The jump in TLRY stock follows the company’s announcement that it will acquire eight beer and beverage brands from Anheuser-Busch (NYSE:BUD).
Pick the best stocks and maximize your portfolio:
- Discover top-rated stocks from highly ranked analysts with Analyst Top Stocks!
- Easily identify outperforming stocks and invest smarter with Top Smart Score Stocks
The leading cannabis lifestyle and consumer packaged goods company said that the eight beer and beverage brands have strong consumer loyalty and will enable the company to diversify its growing U.S. beverage alcohol offerings. Moreover, the expected sales volume (expected to generate craft beer pro forma revenue of $250 million) from the acquired brands will enhance Tilray Brands’ ranking to the fifth position in the craft beer business in the U.S. from the current ninth position.
The company’s CEO, Irwin D. Simon, said that the deal “solidifies” the company’s “national leadership position and share in the U.S. craft brewing market and marks a major step forward in our diversification strategy.” Also, it will strengthen its distribution footprint nationwide.
Tilray also explained that the transaction includes the current employees, brewpubs, and breweries associated with these brands. The company expects to close the all-cash transaction in 2023. However, the purchase price was not disclosed.
Analyst Weighs In
Jefferies analyst Owen Bennett reiterated a Buy on Tilray stock following the announcement of the acquisition. Bennett said that the deal will create “both near-term and long-term value for Tilray.
He added that the company is receiving flack for no longer being the “pure play cannabis” player. Instead, Tilray has moved into other segments. Nonetheless, the analyst added that as long as Tilray’s business is creating value for its shareholders and the company has a “clear articulated strategy that it executes on, that is all that should matter.”
Bennett has a price target of $3.90 on TLRY stock, implying 75.68% upside potential from current levels.
What is the Price Target for Tilray?
Bennett’s price target is the highest among the analysts covering the stock. Overall, Tilray stock has received two Buy and four Hold recommendations for a Moderate Buy consensus rating on TipRanks. These analysts’ average price target of $2.47 implies 11.26% upside potential from current levels.
While TLRY stock could benefit from the new opportunities, investors can use TipRanks’ penny stock screener to find other attractive Penny stocks with the potential to deliver significant returns.
