Analyst doesn't advise shares of cannabis seller Tilray: even Trump's executive order won't help him

Investors should not invest in Tilray Brands, a Nasdaq-listed Canadian cannabis producer and marketer, even though it is cheap, says Prosper Junior Bacchini, a freelance analyst at Motley Fool. It has unstable financial results that are unlikely to be positively impacted by even a softening of regulation in the U.S. cannabis market, the analyst said.

Over the past five years, Tilray's stock has plummeted nearly 97% to $5.5, but that's no reason to buy it, Bakini believes. He attributes this to the fact that despite revenue growth, the company remains unprofitable. For the fiscal quarter that ended Feb. 28, Tilray's net revenue increased 11% year-over-year to $206.7 million, while its net loss narrowed 97% to $25.2 million.

Many investors expect the easing of regulation in the U.S. cannabis market to be a game changer for the company, an analyst says. In December 2025, U.S. President Donald Trump signed an executive order on easing regulation of marijuana. In particular, he obliged the Ministry of Justice to begin steps to reclassify the substance and move them from the strict Schedule I, where heroin and LSD are located, to the less strict Schedule III - to ketamine and painkillers with codeine. And on April 23, acting U.S. Attorney General Todd Blanch signed the relevant orders. This caused Tilray's stock to plummet nearly 12%. In total, since April 22, - the day preceding this order, the company's quotes have fallen by more than 30%.

Bakini believes that the reform is unlikely to significantly affect Tilray's business. He has several arguments. First, so far the innovations apply only to medical marijuana, not recreational marijuana.

Second, Trump's executive order does not make the substance legal at the federal level - states still have the authority to restrict its use.

Third, it's still just as illegal to ship cannabis across state lines. This, the analyst writes, forces companies to grow and produce marijuana in every state where they do business, which is "incredibly inefficient." Bacchini cites this as a major reason why U.S. growers are unprofitable.

All of this makes him doubt Tilray's long-term prospects.

Wall Street is generally cautious in its assessment of Tilray: seven analysts recommend holding its shares and six recommend buying. The average target price is $9.72, which is almost 77% higher than the closing price of the stock on May 26.