The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. 2023, Nasdaq, Inc. All Rights Reserved. May 3, 2021 8:29 AM EDT. Related News:good natured Products Revenue Increases 65% In FY2020The Green Organic Dutchman Gives Update On OperationsAphria Shareholders Approve Tilray Merger. The pro-form enterprise value of the company is listed at $3.9 billion. Overhead. But Aurora Cannabis (NYSE:ACB) is cheaper on that basis and, again, not all of Aphrias revenue is created equal. That business has gross margins of just 13% and not all of the revenue comes from cannabis. Net cannabis revenue plunged by nearly one-fourth quarter-over-quarter. The first quarter of 2021 has come to an end and it was certainly one to remember for the top cannabis stocks in the market. Marijuana stocks experienced a surge in price on Monday after Governor Andrew Cuomo confirmed that his state was very close to lega STONERS ROTATION 2023 | A VESSEL CREATIVE COMPANY. Corinne Cardina has no position in any of the stocks mentioned. Tilray Inc. TLRY, -4.35% shareholders voted to approve the Canadian cannabis company's proposed merger with Aphria Inc. apha ca:apha at a special meeting on Friday, according to media reports . It would also see the new company instantly offer real competition to established players like Canopy Growth and Aurora Cannabis both in North America and globally. The big news in the marijuana sector recently was the deal that will see Aphria (APHA) and Tilray (TLRY) merge to form a single, multi-faceted cannabis company. The new company will trade under Tilrays ticker on the Nasdaq, and Aphria shareholders will own 62% of Tilrays stock under the terms of the transaction, which was characterized as a reverse acquisition of Tilray, the companies said. Locked in or trapped? This means be patient and look to average costs into TLRY stock. She is based in New York. After all that, Aphria is going to own something like 62, 63. Results for the fiscal third quarter (ending Feb. 28) were not promising on that front. Although Tilray is down by around 50% year to date, Aphria is up by 72% this year. Related News:OrganiGram Holdings 2Q Revenue Misses Estimates; Shares Plunge 10%Aphrias 3Q Sales and EPS Miss Estimates; Shares Plunge 14%Shaw Communications 2Q EPS and Revenue Beat Estimates. Aphria ( APHA ) and . Based on April 16 closing prices, APHA trades at 0.822x of what TLRY trades at, which is similar to the merger ratio. Since th Canopy Growth (NASDAQ: CGC), a top weed stock and leading cannabis producer and distributor has just added a new name to its growing Cannabis stocks have been experiencing an ecstatic high since the final quarter of last year. Using pro forma Adjusted EBITDA, even accounting for the cost savings, the combined companys multiple sits over 50x. Cost basis and return based on previous market day close. On December 16, 2020, Tilray (TLRY) and Aphria (APHA) announced a merger that would create the largest marijuana company globally. The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc. 2023, Nasdaq, Inc. All Rights Reserved. Tilray Marijuana stocks rallied as high as 27% when it announced its agreement to enter into a merger with Aphria just before Christmas. 1125 N. Charles St, Baltimore, MD 21201. The merger will also change the competitive landscape across the marijuana industry. That equals 632 million in losses (U.S. $505 million). In late 2019, I called it my pick in the cannabis sector. Aphria(APHA)andTilray(TLRY)first announcedtheir proposeddealin December of last year. You must be 21 years or older to view and purchase products featured on this site. Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. The merged entity would have diversified global operations. Aphrias pending merger with Tilray (NASDAQ:TLRY) admittedly makes some sense. Meanwhile, Tilrays current CEO and Chairman will be one of the new companys board of directors. Copyright 2023 MarketWatch, Inc. All rights reserved. Because a game-changing deal just went down between the Ontario government and this powerhouse companyand you need to hear this story today if you have even considered investing in pot stocks. Nasdaq Merger Details The deal, should it be approved, will go as follows. That might not be an easy sell. Invest better with The Motley Fool. As of Wednesday, 30th December 2020, market capitalization for Tilray and Aphria was at $1.31 billion and $2.195 billion respectively. However, there has been a sell-off since then. No wonder both the stocks rallied after the merger was announced. By using stonersrotation.com, you agree to these terms before purchasing from this website. Interestingly, Sweetwater also produces hemp-infused beverages. Your access is restricted because of your age. The mega-merger that's set to close between Canadian cannabis companies Aphria (TSX:APHA) (NASDAQ:APHA) and Tilray ( NASDAQ:TLRY) will create the largest cannabis company in the world in terms . quotes delayed at least 15 minutes, all others at least 20 minutes. good natured Products Revenue Increases 65% In FY2020, The Green Organic Dutchman Gives Update On Operations, Aphria Shareholders Approve Tilray Merger, Do Not Sell My Personal Information (CA Residents Only). Offers may be subject to change without notice. Second, Aphria also now owns Sweetwater Brewing. Finally, consolidation is a welcome step in the marijuana industry. Marijuana stocks have been very volatile over the last few months. Learn More. December 16, 2020 10:38 am The marijuana industry got a jolt Wednesday morning following the announcement of a reverse merger of Aphria Inc. ( NASDAQ: APHA) and Tilray Inc. ( NASDAQ: TLRY). Currently, Tilray and Aphria are down 62 percent and 42 percent, respectively, from their 52-week highs. Valuation is acceptable, but not compelling. Current share. Copy and paste multiple symbols separated by spaces. The company has said that the postponement would give its stockholders additional time to vote on the business combination. Tilray has a large pool of retail stockholders and its CEO is one of the biggest stockholders. All Rights Reserved. Article printed from InvestorPlace Media, https://investorplace.com/2021/04/apha-stock-hard-pass-ahead-tilray-merger/. Again, relatively speaking, you're not talking Philip Morris (PM 0.46%) or Exxon (XOM -1.16%) here, these are relatively small companies. Tilray lost 271 million CAD for the year ending Dec. 2020 and Aphria has lost 361 million CAD in the nine month period ending Feb. 28. On the date of publication, Vince Martin did not have (either directly or indirectly) any positions in the securities mentioned in this article. This merger between these two cannabis firms will see Tilray become the biggest player in the sector globally. All told, nothing here really stands out. Thats true, technically. Aphria shareholders will receive 0.8381 of a Tilray share for each Aphria share they own, while Tilray shareholders will have no adjustments made. 7 Sorry Pharma Stocks to Sell in April Before Its Too Late, Louis Navellier and the InvestorPlace Research Staff, 5 Penny Stocks With Explosive 5X Potential, Another Rare Bullish Indicator Flashed Last Week, 7 Stocks to Sell in April Before They Crash and Burn, Mullen Files to Resell Up to 2.1 Billion Shares of MULN Stock. In terms of leadership for the combined company, Aphrias current CEO and Chairman, Irwin Simon will work in the same capacity. Moreover, vaporizing does not necessarily eliminate toxins. Say hello to what has become, at a stroke, a dramatically larger marijuana company: the new version of Tilray (TLRY). Hopefully, the merger will find more than 100 million CAD in synergies to make this company profitable. This is why Aphria's merger with Tilray is so critical. Tilray and Aphria are joining in what is being called a pot stock megamerger. Action Alerts PLUS is a registered trademark of TheStreet, Inc. Take Charge of Your Money During our April Sale! First, Aphria has a distribution business in Germany that accounted for more than half of revenue in the third quarter. Written by In the all-stock merger, Aphria shareholders will receive 0.8381 shares of TLRY stock for each share of APHA they own. Making the world smarter, happier, and richer. Talking of marijuana stocks, they have started to look very overvalued at their peaks even if we discount all of the positives. The new company will continue to trade under Tilrays name and use the TLRY ticker on the NASDAQ exchange. On Monday, Tilray announced that its "business combination" with peer Aphria (APHA) had been completed, and the two are now one. The weed stock industry continues to shape up positively as newly legalized states open up more expansion opportunities. Cost basis and return based on previous market day close. Eventually, on the merger date, APHA stocks would get converted to TLRY stocks based on the merger ratio. However, given the fragmented nature of the marijuana industry, I dont see any real regulatory hurdle for the merger. Why Aphria, OrganiGram Holdings, and Aurora Cannabis Rose Today, 3 Warning Signs From Aphria's Abysmal Earnings Report, Forget Aphria and Tilray: This Cannabis Merger Is Much More Promising, The IRS Is Urging Millions of Early Filers to Amend Their Tax Return, 1 Warren Buffett Index Fund Could Turn $100 Per Week into $1 Million, 2 Stocks That Could Join Apple, Microsoft, Amazon, and Alphabet in the $1 Trillion Club, Join Over Half a Million Premium Members And Get More In-Depth Stock Guidance and Research, Copyright, Trademark and Patent Information. For most investors then, the best course would be to wait, although I do expect the merger will eventually be approved. Benzinga spoke . Founded in 1993 by brothers Tom and David Gardner, The Motley Fool helps millions of people attain financial freedom through our website, podcasts, books, newspaper column, radio show, and premium investing services. They're going by trailing 12-month revenue and I don't know if going forward that's sustainable. All rights reserved. Aphria shareholders will receive 0.8381 shares of TLRY stock for every one share of APHA stock they own. Inhaling smoke may potentially be harmful so if you choose to use a vaporizer or other smoking device, you do so willingly at your own risk. However, the arbitrage opportunity has since come down greatly. Since the merger between Aphria ( APHA) and Tilray ( TLRY) was announced on December 16, 2020, the two stocks have traded apart and resulted in a somewhat bizarre situation. +2.93% Tilray shareholders risk seeing that price fade lower if the merger is not approved. Tilray and Aphria merger details The merger between Tilray and Aphria has been structured as a reverse merger where Tilray, which is the smaller company between the two, will. All products available for purchase through this website are intended for hemp-derived products with less than 0.3% concentration of THC by dry weight, as well as other legal herbs. Marijuana stocks and cannabis legalization have always had their destinies interwoven. However, for the merger to be confirmed, it would have to be approved by TLRY stockholders. But again relatively speaking, they're going to be a big player in marijuana, they're going to be hard to ignore, they're going to be the largest Canadian marijuana company by far. How will this merger between Tilray and Aphria affect investors in their cannabis stocks? Also, in SPACs, there can be significant arbitrage between the common stock and the warrants. You must be 21 years of age or older to view the page. Thanks to the crazy Reddit-driven rallies in February, the spread between TLRY and APHA ballooned. The steep fall in TLRY stock from the peaks ensured that the arbitrage evaporated. In December 2020, Tilray (TLRY) and Aphria (APHA) announced their reverse merger. Aphria and Tilray agree to join forces, creating the worlds biggest marijuana production and distribution company with a combined value of nearly $4 billion. Both stocks will, assuming the merger closes, end up in the same place. . Thats not cheap, either. Aphria shareholders will also own 68% of the new . Now, all eyes will be on the TLRY stockholder meeting later this month when the company takes up the merger vote. Cannabis stocks traded up this week, following news of the merger between Aphria (NASDAQ: APHA) and Tilray (NASDAQ: TLRY ). Eric Volkman has no position in any of the stocks mentioned. In the middle of February, APHA stock was trading at around 0.41x what TLRY was trading at. The latest among these states is New Mexico. And that's crucial, given past results. apha Copy and paste multiple symbols separated by spaces. The merger would be subject to regulatory approvals. The all-stock deal that will create a new powerhouse in the pot industry, with an equity value of about C$4.8 billion ($3.8 billion). When the symbol you want to add appears, add it to Watchlist by selecting it and pressing Enter/Return. Tilray changed its bylaws in April to reduce its shareholder vote quorum to one-third of the voting power of the outstanding shares entitled to vote to approve the deal, instead of a majority of the voting power of the outstanding shares. Simonsaid, "I want to thank all Aphria Shareholders for voting and approving the Arrangement. +5.49% Tilray's merger with Aphria, announced in December and set to close in Q2, will create the largest cannabis company. Tilray (NASDAQ:TLRY) shareholders will vote on the all-stock merger with Aphria (NASDAQ:APHA) on April 30. 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