Shares of Tilray (TLRY -3.38%) fell 9.5% on Tuesday after government leaders in Germany postponed a final vote on a bill to legalize marijuana until next year. The vote was initially planned for this week.
Germany delays its cannabis legalization vote
As a leader in cannabis research, cultivation, and distribution -- and noting its European headquarters office is located in Germany -- Tilray obviously has much to gain with every country that legalizes the drug. Tilray chairman and CEO Irwin Simon even traveled to Germany last to visit its Parliament and discuss cannabis ahead of the vote.
Late yesterday, however, the vote was called off after leaders of the country's Social Democratic Party (SPD) voiced concerns over the legalization proposal.
"It always has to be approved by the parliamentary groups in the end," wrote Dirk Heidenblut, an SPD member responsible for the party's cannabis policy, in a social media post. "And if a faction leader, in this case the SPD, has concerns, then it cannot be set up yet."
What's next for Tilray investors?
Even so, Simon remained confident Germany remains on track to eventually legalize marijuana.
"Tilray is well set for the German market, which is the biggest market in the European market," Simon told Bloomberg after the delayed vote became public. "So we're really excited about it, and in my opinion, it's not a matter of if it will happen, it's when it will happen."
Indeed, Heidenblut noted that as long as the bill advances through Germany's parliament by the end of January 2024, it shouldn't have a significant impact on the country's planned schedule for implementing legalization. The early stages of that process could start as early as April 2024.
Perhaps that's fitting for Tilray, considering today's pullback simply erased a roughly equivalent gain yesterday. Over the longer term, however, I think it remains arguably the best-positioned marijuana stock the market has to offer.
