Marijuana stock Tilray (NASDAQ: TLRY) increased in value by more than a fifth today, closing the day up 22.2% — and for a most surprising reason.
Early Tuesday morning, Tilray announced that it has brought on former Revlon executive Jon Levin to serve as its new Chief Operating Officer and former Molson Coors executive Michael Kruteck to serve as Chief Financial Officer. The hiring of two new C-level execs appears to be the primary driver behind today’s rise in share price.
But should it be? CEO Brendan Kennedy says Levin and Kruteck “come to Tilray with extensive expertise in their respective fields and we look forward to their contributions as we pioneer the future of cannabis and hemp around the world.” Kruteck in particular could prove to be an asset, given his experience with brewer Coors, and Tilray’s ongoing partnership with beer-maker Anheuser-Busch Inbev.
It’s unclear at this point, however, whether the addition of two new employees — even of this caliber, and at this level — will be enough to reverse the sharp slowdown in Tilray’s business, where third quarter sales grew less than 15% sequentially, after accelerating gains of 39% and 95% in the preceding two quarters.
Looking ahead, analysts forecast that in the fourth quarter, Tilray will report sales of $55.8 million — an impressive four-fold improvement over Q4 2018 numbers, but sequentially, only about 16% growth.
Unless Tilray beats those estimates and shows it can get its momentum moving again, today’s gains in the stock could soon evaporate.