At what price is Tilray worth buying?

As an investor, you’d struggle to find a hotter group of stocks, and a faster-growing industry, than marijuana. In January alone, more than a dozen pot stocks rose by at least 50%. And in many instances, this comes after triple-digit, or even quadruple-digit, percentage gains since the beginning of 2016.

The reason it’s easy to become enamored with pot stocks is the large dollar figures behind the industry. Depending on your source, the legal weed industry could grow to between $50 billion and $75 billion in annual sales in roughly a decade, which would place it practically on par with sales from the global soda industry. That’s a lot of money, and picking the right marijuana stock could mean locking in substantial gains…

One such company that’s been a bottle-rocket since debuting in July is cannabis grower Tilray(NASDAQ:TLRY). This first-ever Canadian pot stock to go the initial public offering route on the Nasdaq listed its shares at $17, but has seen its value quadruple through this past weekend. Clearly, Wall Street and investors have liked what they’ve seen.

But that doesn’t mean everyone is impressed. Yours Truly doesn’t believe Tilray offers attractive value to investors at its current price. However, I do have a price range in mind where I believe Tilray does become an attractive company worth buying consideration. Before I unveil that share price range, let me walk you through my thought process as both a bull and a bear.

Understanding the Tilray buy thesis

Despite my personal hesitation, Tilray does bring quite a bit to the table. For starters, it nabbed two brand-name partnerships during December. The first, with Novartis‘ generic-drug subsidiary Sandoz, expanded an existing relationship. Rather than simply distributing non-combustible medical pot products domestically in Canada, the new agreement covers global distribution.

Just days after expanding its working relationship with Novartis, Tilray and Anheuser-Busch InBev announced a $100 million joint venture that’ll see each company contributing $50 million. The point of this joint venture will be to research and develop a line of nonalcoholic cannabis-infused beverages, which should be legal in Canada by this coming October. Tilray’s ability to attract brand-name partners speaks to…

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