Tilray (NASDAQ:TLRY) stock has climbed since October, but it remains far below its past highs. After the Democratic Party’s “blue wave” in last year’s U.S. elections failed to result in legalization, the retreat of Canada-based cannabis plays like TLRY stock makes sense.
Pot is now legal in dozens of U.S. states. But without changes in federal law, Canadian names like Tilray can’t enter the U.S., which could become the world’s largest legal cannabis market. Before diving back into Tilray, Canopy Growth (NASDAQ:CGC), and others, investors are waiting for Congress to legalize marijuana.
Consequently, TLRY stock and its peers could continue to deliver mediocre returns in the near-term. Yet this “out of favor” status for the sector among Main Street and Wall Street investors may provide investors with a good opportunity. Despite doubts about whether U.S. legalization will ever occur, there’s a good chance that the drug will be legalized in a few short years.
Further, Tilray has some other possible, positive catalysts on the table. Although the shares may not rally for some time, you may want to take a bullish position in the name, since its share price is likely to undergo an epic rebound.