Shares of Tilray Brands (NASDAQ:TLRY) are up roughly 10% in early Thursday trading, changing hands near $8.68 after the stock closed up 14% at $7.87 on Wednesday. The catalyst is growing speculation that the administration is preparing to reclassify marijuana to a less-dangerous drug category, a regulatory tailwind cannabis investors have been waiting on for years.
The back-to-back surge marks one of the sharpest two-day moves for TLRY stock in months. Traders are debating the potential long-term valuation impact if rescheduling is formalized, and many are watching closely for official confirmation that could sustain or extend the bullish momentum.
Sentiment is decidedly bullish for now, yet the move remains speculative. Wednesday’s action also intersected with a $180M equity offering and an ongoing dilution debate, adding noise to what would otherwise be a cleaner rescheduling trade.
Rescheduling Speculation Drives the Pop
Recent reports indicate the Trump administration is expected to reclassify marijuana as a Schedule III drug, which would ease DEA barriers to cannabis research and unlock potential federal tax treatment advantages for operators. The headlines triggered a sector-wide bid Wednesday, and momentum carried into Thursday’s open on fresh speculation about imminent action.
Tilray Brands CEO Irwin D. Simon has repeatedly flagged rescheduling as transformative. In prior remarks, he said federal rescheduling “would mark an important advancement for medical cannabis in the United States, paving the way for more research, wider physician involvement, and better patient access.” Tilray plans to leverage its $150M global medical cannabis business and $300M Tilray Pharma distribution platform to roll out a U.S. medical model upon rescheduling.
The fundamentals remain mixed heading into the event. Tilray Brands’ Q3 FY26 print on April 1 showed $206.73M in revenue, beating the $201.3M consensus. On the bottom line, adjusted EPS of $0.02 missed the $0.07 estimate. International cannabis revenue jumped 73% year over year to a record $24.12M.
Peers Move Together, Prediction Markets Stay Cautious
Cannabis peers including Canopy Growth (NASDAQ:CGC), Aurora Cannabis (NASDAQ:ACB), and Cronos (NASDAQ:CRON) typically trade in sympathy on rescheduling headlines, and sector-wide flows have been active through the two-day rally. Roth Capital recently upgraded Tilray stock, citing a stable Canadian business, improved international operations, and a turnaround in beverages, though at least one analyst trimmed targets after the Q3 miss. The broader setup echoes other cannabis sector moves tied to policy headlines this month.
The prediction markets tell a more cautious story. Polymarket’s December 31, 2026 rescheduling contract is pricing just a 39% probability of Yes, while the June 30, 2026 deadline market sits at 19%. Reddit chatter, by contrast, registered a bullish 72 sentiment score with 99 upvotes and 30 comments.
The valuation debate is front and center in community discussion. With a market cap near $917M and shares down roughly 95% over five years, traders are weighing whether a regulatory catalyst can meaningfully reset the multiple for Tilray Brands or simply offer a trading window.
Analyst targets haven’t fully caught up to the move. The consensus for TLRY stock sits at a $10.04 price target with 2 buy, 7 hold, and 1 sell rating, implying further upside if the rescheduling catalyst holds.
What to Watch Into the Close
Investors should watch for whether official DEA or DOJ confirmation materializes in the sessions ahead. Timelines remain fluid, and the pending DEA status update in July and potential litigation introduce real uncertainty that could blunt further upside if delays resurface.
The next earnings date is July 1, 2026, when Tilray Brands reports its Q4 FY26 results. Management has reaffirmed FY26 adjusted EBITDA guidance of $62M to $72M, giving bulls a fundamental floor beneath the regulatory trade.
Traders should keep an eye on whether TLRY stock holds above Wednesday’s close into the bell. A confirmed federal rule could extend the rally, while a procedural delay may invite fast profit-taking on a name that’s been historically volatile. Momentum traders should expect an active tape through the afternoon.
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