Tilray's Stock Is Down 45% This Year, and Here's Why It Could Still Go Lower

Tilray Brands (NASDAQ: TLRY) stock has been having an awful year, as it's down 45% thus far in 2026. The cannabis company, which often boasts of its leadership position in the industry, has continually faced adversity over the years.

Ironically, the legalization of marijuana in Canada hasn't even helped the business. Instead, it has opened the floodgates to more competition and red tape. As a result, the company has pivoted to focus more on beverages and acquired craft brewers to diversify its business and grow sales.

But while the pot stock continues to fall, investors shouldn't assume that it can't go lower. In fact, due to a recent development, there's reason to believe Tilray's stock could decline even further this year.

Trulieve begins trading on the NYSE

Last week, the big news on the markets was about SpaceX going public, but there was another stock that also began trading on a major exchange, one with more significant consequences for Tilray Brands, and that's Trulieve Cannabis (NYSE: TRLV).

Trulieve is a multi-state operator (MSO) that generates revenue in the U.S. market, with a heavy presence in Florida. It was able to uplist onto the New York Stock Exchange last week after the U.S. government rescheduled certain medical marijuana products down to Schedule III from Schedule I.

This might not seem like a huge problem for Tilray, but it is. Investors may previously have bought Tilray's stock because it offered a way to benefit from future opportunities in the U.S. marijuana market, if and when it eventually opens. Now, however, with Trulieve's stock trading on a major U.S. exchange, it's easier for investors to simply gain exposure to the U.S. marijuana market through Trulieve; there's no need to buy and hold Tilray's stock, hoping that one day the U.S. will legalize marijuana and Tilray will benefit from the opportunity. With investors now having more choices, there may be less interest in Tilray.

Tilray's stock may no longer be the go-to option for marijuana investors

While Tilray has been expanding into international marijuana markets and acquiring craft brewers, it's not the same for investors as actually having exposure to the U.S. marijuana market, which may have the most exciting growth potential in the long run. Its strategy hasn't exactly paid off, either. Tilray has incurred an operating loss in each of the past four quarters, and it's struggled to generate consistent growth.

With poor fundamentals and an uncertain future, it's difficult to make the case that Tilray is worth investing in, even if its valuation may look low.

David Jagielski, CPA has no position in any of the stocks mentioned. The Motley Fool recommends Tilray Brands. The Motley Fool has a disclosure policy.