Tilray Inc (NASDAQ:TLRY) shares were up more than 18 percent Wednesday after Citron Research called the Canadian medical pot company the next in line in a budding cannabis Industry.
The move comes on the same day that Canopy Growth Corp (NYSE:CGC) shares surged 28 percent after beer producer Constellation Brands, Inc. (NYSE:STZ) announced it was expanding its partnership with the company by investing $4 billion and increasing its stake to 38 percent.
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'Weed Is Not Only Real, But Also Investable'
Wednesday is "a turning point in the cannabis industry," according to Citron, which put a $45 price target on Tilray — a nearly 58-percent premium to the stock's current valuation.
“Today we state that you would have to be ‘high’ to short any of the marijuana names based on the recent investment by Constellation in Canopy Growth, the largest investment in the space" at $4 billion, said Citron's Andrew Left. "The premium paid to market shows confidence by Constellation that could rattle any short seller."
The infamous short seller said his firm believes Tilray is best-in-class and, if it were to get the same multiple it is assigning to Canopy Growth, the stock would be trading at $45 per share.
“Forget about bitcoin mania, today solidified that weed is not only real, but also investable despite stretched valuations. It is only [a matter of] time before Tilray reaps the benefits of this mania by either increased shareholder support or more likely a multinational partner or buyout."
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