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Tilray Brands (TLRY) Lined Up for Q4 Earnings: What Awaits?

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As Tilray Brands, Inc. (TLRY - Free Report) prepares to announce its fourth-quarter 2024 earnings, investors are keenly watching for insights into the company’s performance and strategic direction. 

Net revenues of the company engaged in the research, cultivation, processing and distribution of medical cannabis products are expected to have increased year over year. The Zacks Consensus Estimate for fourth-quarter revenues stands at $225.7 million, which indicates an increase of 22.5% from the prior-year reported figure. The consensus estimate for the bottom line stands at a loss of 2 cents.

Tilray Brands has a trailing four-quarter earnings surprise of 50%, on average. In the last reported quarter, the company surpassed the Zacks Consensus Estimate by a margin of 100%.

Factors to Consider

Tilray's diversified product innovation, spanning medical cannabis formats, THC-infused beverages and pharmaceutical-grade medicines, enhances its ability to capture new market segments globally. The company's focus on organic growth and strategic acquisitions, exemplified by the integration of HEXO and Truss Beverage, underscores its commitment to maximizing revenue opportunities.

Tilray's extensive geographic reach further strengthens its growth potential. In the last reported quarter, more than 62% of net revenues were generated in North America, 36% in the EMEA and the remaining 2% from other regions. This broad distribution reduces market risk and positions Tilray to leverage opportunities in different economic environments.

Tilray Brands has established itself as a global leader in the cannabis industry, leveraging favorable regulatory shifts and dynamic market conditions to cement its position. With the largest market share in Canada and a strong portfolio of adult-use brands, Tilray is poised to benefit from potential regulatory changes, such as the transition to an Ad Valorem Tax system. This change alone could significantly enhance the company's profitability.

In Europe, Tilray maintains a leading position in the medical cannabis market, particularly in Germany, where it holds the highest revenue market share. By leveraging local cultivation facilities in Germany and Portugal, Tilray is well-positioned to capitalize on the expanding medical cannabis market. Legislative reforms, including the removal of medical cannabis from narcotics acts, are expected to further boost market penetration.

Despite the favorable trends toward legalization, the cannabis industry is still subject to significant regulatory uncertainties and market risks. Changes in regulations, market dynamics or competitive pressures could impact Tilray’s growth trajectory. Another major factor hurting Tilray's margins is the high excise taxes and price compression in Canada. The substantial increase in excise taxes, which surged significantly in the third quarter, combined with a dramatic reduction in cannabis prices, presents a challenging market environment. These high taxes and price pressures erode profit margins.

Tilray Brands, Inc. Price, Consensus and EPS Surprise

Tilray Brands, Inc. Price, Consensus and EPS Surprise

Tilray Brands, Inc. price-consensus-eps-surprise-chart | Tilray Brands, Inc. Quote

What the Zacks Model Unveils

Our proven model doesn’t conclusively predict an earnings beat for Tilray Brands this time. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. However, that’s not the case here. 

Tilray Brands currently has a Zacks Rank #3 but an Earnings ESP of 0.00%, thus making the surprise prediction difficult. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

3 Stocks With the Favorable Combination

Here are three companies you may want to consider, as our model shows that these have the right combination of elements to post an earnings beat this season:

Chewy, Inc. (CHWY - Free Report) has an Earnings ESP of +1.61% and currently sports a Zacks Rank of 1. CHWY's top line is anticipated to advance year over year when it reports second-quarter fiscal 2024 results. The Zacks Consensus Estimate for its quarterly revenues is pegged at $2.86 billion, which suggests a 2.9% rise from the figure reported in the year-ago quarter. You can see the complete list of today’s Zacks #1 Rank stocks here.

The company is expected to register an increase in the bottom line. The consensus estimate for CHWY’s fiscal second-quarter earnings is pegged at 22 cents a share, up 46.7% from the year-ago quarter. CHWY has a trailing four-quarter earnings surprise of 57.7%, on average.

Ollie's Bargain (OLLI - Free Report) currently has an Earnings ESP of +2.38% and a Zacks Rank of 1. The company is likely to register an increase in the bottom line when it reports second-quarter fiscal 2024 numbers. The Zacks Consensus Estimate for quarterly earnings per share of 78 cents implies a jump of 16.4% from the year-ago reported number. 

Ollie's Bargain’s top line is expected to have ascended year over year. The Zacks Consensus Estimate for quarterly revenues is pegged at $562.4 million, which suggests an increase of 9.3% from the prior-year quarter. OLLI has a trailing four-quarter earnings surprise of 10.4%, on average.

Costco Wholesale Corporation (COST - Free Report) currently has an Earnings ESP of +1.23% and a Zacks Rank of 2. The company is expected to register top and bottom-line growth when it reports fourth-quarter fiscal 2024 numbers. The Zacks Consensus Estimate for COST’s quarterly revenues is pegged at $80 billion, which implies growth of 1.3% from the year-ago quarter’s reported figure.

The consensus estimate for Costco’s earnings has increased by a penny in the past 30 days to $5.02 per share. The consensus estimate for earnings suggests a jump of 3.3% from the year-ago quarter’s reported figure. COST delivered an earnings beat of 2.3%, on average, in the trailing four quarters.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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