Canadian Cannabis companies, Tilray and Aphria announced the closing of their merger today. So Aphria Delisted is a big news around. Why is Aphria Untradeable? How can you trade Tilray stock? I will help answer these questions.
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The Aphria Tilray merger resulted in creation of the world’s biggest weed company by revenue.
With this merger, I am sure that you would have a lot of questions right now, such as, What happens to my Aphria stock after merger, When will Aphria stocks be converted to Tilray? When will Tilray and Aphria merger be completed and When will the new Tilray start trading on the Toronto Stock Exchange, being a Canadian company?
I am going to answer all these questions for you, along with my financial analysis of Tilray stock so that you can make a decision whether to Buy, Sell or Hold the stock today.
The Tilray and Aphria merger was completed today. As a result, Aphria, Aphria stock will be delisted and you will no longer be able to trade it. So your next question is what will happen to my Aphria stocks?
Everyone, who owned stocks of Aphria have received 0.8 Share of Tilray for every share of Aphria. So if you owned 100 shares of Aphria as of last Friday, you would have received at least 80 shares of Tilray. Today after the merger, Tilray stock is down by 7%. Now don’t be alarmed by this at all. This is expected behavior after a merger. It will start going up in a few days.
Overall, Tilray stock has done very well in the last 1 year, by gaining 129% in value.
Currently Tilray has a market capitalization of $3 billion. The new combined company of Tilray will have a market capitalization of $8.2 billion.
Tilray stocks will continue to be traded on Nasdaq while they will start trading on Toronto Stock share on this Wednesday, that is on May 5th.
The hope is that this merger will help Tilray expand its global footprint, which it has not been able to do due to COVID-19 Pandemic.
Let us look at the company’s financials to understand if this is a good stock to buy, Sell or Hold at the moment.
Tilray is currently trading at $17 per share
1 year performance has been great. The stock has gone up by 129%
The price to earnings ratio (PE ratio) is -12, which is a big red flag because it means that the company is losing money
The analysts have given it a Hold rating
Average price rating is $19
The merger is expected to bring in about $81 million of annual pre-tax savings. I think that as the Pandemic restrictions start easing around the world in next few months with vaccination in place, Tilray will have opportunities to expand its business globally. So in the upcoming years, we can expect to see more revenues and profits for the company. Also, the stock is cheap, at $17 so you may invest very little at this time, something you can risk to lose but can still generate big rewards if the stock goes up.
I personally have about 125 shares of Tilray. However, the company’s profitability and Pandemic restrictions are the two things that I would monitor closely this year to see if I want to invest more or get rid of the ones I already have.
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