Tilray Brands has called for a special stockholder meeting to discuss a potential reverse stock split, with ratios ranging from 1-for-10 to 1-for-20 being proposed. Over the past week, the company's stock price fell 10.24%, a decline that stands out against the broader market's 3% drop. Although Tilray's governance changes may add uncertainty, especially with the impending stockholder vote, the company's recent performance also aligns with overall market jitters following UnitedHealth's stock plunge affecting the Dow Jones. Nonetheless, the governance updates could exert additional influence on Tilray's stock performance in the coming weeks.

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Over the past year, Tilray Brands' total shareholder return was a decline of 72.34%. This sharp decrease underscores a challenging period for the company amidst wider market jitters. When compared to the US Pharmaceuticals industry, Tilray underperformed, as the industry saw a less significant decline of 8% over the same time. The company's stock also trailed behind the broader US market, which experienced a 4.6% gain over the past year.

The potential reverse stock split mentioned in the introduction aims to address Nasdaq compliance issues regarding the minimum bid price. This move, coupled with the recent delisting notice, holds significant implications for the company’s revenue and earnings forecasts, which already show some improvement with revised guidance between US$850 million and US$950 million for fiscal year 2025. The current share price reflects a considerable discount to the consensus analyst price target of US$1.31, suggesting that there could be perceived value by market participants if the company successfully navigates these governance and financial challenges.

Review our growth performance report to gain insights into Tilray Brands' future.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Companies discussed in this article include NasdaqGS:TLRY.

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