TLRY stock soars 14% as Trump signs historic executive order moving cannabis to Schedule III in watershed moment for marijuana investors

TLRY stock is soaring today as cannabis investors bet big on President Trump’s historic rescheduling move. The executive order, signed Thursday afternoon, marks a watershed moment for the beleaguered marijuana industry. After years of waiting for federal action, the sector finally gets its breakthrough.

Cannabis Market Rallies After Years of Federal Gridlock

The cannabis industry has faced regulatory headwinds since the 1970s when marijuana landed on the DEA’s most restricted controlled substances list. Nothing has tested investor patience quite like watching other countries embrace legalization while the U.S. remained stuck in bureaucratic limbo.

Trump’s decision to reclassify marijuana sends shockwaves through the entire sector. Major cannabis producers like Tilray Brands were already trading higher earlier in the week on rumors, but the official executive order signing Thursday afternoon confirmed what bulls have been dreaming about.

Understanding the Schedule III Reclassification Reality

Moving cannabis from Schedule I to Schedule III is genuinely significant, though it won’t immediately legalize marijuana nationwide. Schedule I status means the DEA considers a substance to have high abuse potential and no accepted medical use. Schedule III substances include medications like ketamine and anabolic steroids, indicating lower abuse potential and accepted medical applications.

This reclassification addresses one critical pain point for cannabis companies: Section 280E of the tax code. Currently, marijuana producers can’t deduct ordinary business expenses from federal taxes, a burden that doesn’t apply to other industries. The new schedule could ease this crushing tax burden. An executive order does trigger a 30-day public comment period, and potential legal challenges remain possible, but momentum feels genuine.

Cannabis Stock Performance	December 18, 2025 Movement
Tilray Brands (TLRY)	+14% to $14.44
Canopy Growth (CGC)	+21% to $2.33
MSOS Cannabis ETF	+5.5% to $7.05
AdvisorShares Pure US Cannabis ETF	Up Sharply

The Six-Month Surge That Led Here

Tilray shares have experienced extraordinary volatility since early December when Trump first signaled his intentions. The stock jumped 44% on December 12, then surged another 27.5% on December 16 when Trump confirmed he was “strongly” considering the executive order.

The sector’s entire valuation narrative has shifted. Tilray stock has climbed 236% over the past six months as investors increasingly bet on federal action. Some profit-taking happened on December 17 as traders worried about the order’s final form, with TLRY down 7.6%. However, the actual signing cemented conviction.

What Industry Leaders Say About the Reclassification

“This is a game changer for the cannabis industry and marks the most significant change in U.S. drug policy since 1971.”

— Industry analysts, regarding the Schedule III move

Tilray Brands has already announced acceleration of its U.S. medical cannabis expansion strategy following the rescheduling. The company, currently valued at $1.59 billion, can now pursue strategies previously impossible under federal prohibition. Banking access becomes easier, research expansion accelerates, and interstate commerce becomes more feasible.

What Happens to Cannabis Stocks Next as Policy Takes Shape?

The executive order kicks off a 30-day public comment period, during which stakeholders from regulators to physicians to law enforcement will weigh in. After this period concludes, the DEA technically handles the formal rescheduling. The process could face legal challenges from groups opposing rescheduling.

Despite these procedural uncertainties, the market has priced in success. Cannabis ETFs and individual stocks like TLRY have already made substantial gains based on legitimate expectations that rescheduling will eventually stick. Traders haven’t seen federal cannabis policy shift this dramatically in decades, and the momentum suggests conviction runs deep among institutional investors.

Meanwhile, state-licensed cannabis businesses remain unable to list on major U.S. stock exchanges like NASDAQ or NYSE. That restriction doesn’t change with rescheduling alone. However, tax relief under Section 280E would be transformational, significantly improving profitability across the sector. That possibility alone explains why TLRY stock and peers are celebrating today’s executive order signing.

Sources

• Barron’s – Tilray and Cannabis Stocks Soar Ahead of Expected Trump Executive Order
• Reuters – Cannabis stocks rise ahead of potential Trump order to ease marijuana restrictions
• Forbes – President Trump To Reschedule Cannabis As Less Dangerous Drug