Tilray Brands (TLRY) Plunges 2.72% on Third Consecutive Decline Amid Sector Weakness, Regulatory Hurdles

Tilray Brands (TLRY) fell 2.72% on Thursday, marking its third consecutive day of declines with a cumulative drop of 12.97% over three sessions. The stock reached its lowest level since September 2025, with an intraday decline of 4.22%, reflecting ongoing sector-wide weakness and persistent regulatory headwinds.

The cannabis industry’s broader struggles are amplifying pressure on Tilray. Major peers including Canopy Growth and Aurora Cannabis have seen sharp price declines this year, eroding investor confidence. The AdvisorShares Pure US Cannabis ETF, a key sector benchmark, has plummeted from $55.65 to $2.30, underscoring systemic pessimism. Tilray’s stock has lost 70% year-to-date and 76% over the past 12 months, highlighting the sector’s deepening challenges.

Regulatory uncertainty in the U.S. remains a critical obstacle. The likelihood of federal cannabis legislation has diminished with Republican control of key political offices, as many lawmakers oppose legalization. This delay hampers access to banking services and operational scalability for cannabis firms. Analysts suggest meaningful legislative progress may only emerge post-2024, contingent on shifting political dynamics.

Financial performance has further weighed on sentiment. Tilray reported a $793 million net loss in Q1 2025, driven by a $699 million impairment charge linked to macroeconomic conditions. Core cannabis revenue fell to $54.3 million, while beverage alcohol sales grew modestly to $55.9 million. Despite a positive EPS of $0.02 in its latest quarter, revenue of $224.54 million missed estimates. With $199 million in cash and $48 million in marketable securities, the company faces pressure to raise capital, potentially through dilutive measures.

Analyst sentiment remains polarized. Jefferies raised its price target to $2.00 with a “Buy” rating, while others, including Wall Street Zen, have issued “Strong Sell” assessments. The consensus target of $1.94 reflects cautious optimism but aligns with an average “Hold” rating, underscoring lingering risks. Institutional and insider activity offers mixed signals: CEO Irwin D. Simon increased his stake by 4.37%, while hedge funds and institutional investors hold 9.35% of shares, signaling tentative confidence amid broader market skepticism.

Technical indicators suggest potential for a rebound, with a “bullish divergence” forming on charts and the RSI entering an ascending channel. However, the stock’s historic lows and $405 million market cap—far below its $24 billion peak—highlight the scale of challenges ahead. Until regulatory clarity improves or financial performance strengthens, Tilray remains a high-volatility proposition with significant downside risks.