Tilray (NASDAQ:TLRY), the Canadian cannabis company, seems to have lost a good deal of its gusto. TLRY stock ended 2020 at $8.26 and then peaked early in 2021 at $63.91 on Feb. 10. But by the end of 2021, it was lower than where it started by closing at $7.03 on Dec. 31. That’s a return of negative 14.9% for 2021, a miserable performance by any measure.

Moreover, in the past several months TLRY stock peaked at $13.03 on Nov. 15. So in the past month and a half, the stock has tumbled $5.92 to $7.11 as of Jan. 4. That represents a decline of 45.4% in a very short period. It’s almost as if the market has lost all faith in the company.

And why is that? Maybe it has to do with Tilray’s lack of profitability in its fiscal second quarter ended Aug. 31. It might also have to do with forecast losses for the quarter ended Nov. 30. Just more and more of the same. The market just doesn’t like it.

Where Things Stand With Tilray

For example, on Oct. 19, Tilray announced that despite revenue growing 43% year-over-year for Q2 ending Aug. 31, it still lost money.

For example, on revenue of $168 million, its operating loss was $68.5 million. That represents an operating loss margin of over 40%. Moreover, its net loss was over $34.6 million, a net margin loss of 21%.

Moreover, the cannabis company is going to release its results for the quarter ending Nov. 30 on Jan. 10. Don’t expect the company to suddenly turn profitable.

In fact, according to Seeking Alpha, analysts forecast revenue of $174.2 million, or just 3.7% over the Q1 revenue of $168 million.

Moreover, and this is the sad part, analysts still expect the company to lose 8 cents per share this coming quarter. That is after the company lost 8 cents per share last quarter. I suspect that implies that analysts foresee a similar operating loss and negative operating margin.

In other words, just more of the same. Moreover, Yahoo! Finance, which uses Refinitiv analyst survey data, reports that the quarter will actually have a much worse result. Their average analyst estimate is for a loss of 13 cents per share.

Where This Leaves Tilray

Both analysts and the company like to refer to its EBITDA profits (earnings before interest, taxes, depreciation, and amortization). For example, last quarter, Tilray said it was the 10th consecutive quarter it had made positive adjusted EBITDA.

The only problem with this is that these are not real profits. At least on a cash flow and net income basis, the company is still losing money.

For example, at the end of its press release, Tilray reported that its free cash flow (FCF) was negative $109.54 million. That is cash bleeding out the door, no matter what the company says about revenue and EBITDA.

And in the end, if the company keeps bleeding out cash flow like this it is eventually going to need more.

In fact, at the end of August, Tilray had just $376.3 million in cash. You can see this on its balance sheet. It can’t keep bleeding out $100 million every quarter without either borrowing money or raising more equity.

And that is why, in essence, the stock has been falling. The market hates companies like this that bleed cash and likely will dilute shareholders further.

Where This Leaves TLRY Stock

At this point it probably behooves investors in TLRY stock and prospective investors to wait until the company announces its fiscal Q2 results on Jan. 10.

Two things to look for, despite all the headlines, are its cash position on the balance sheet, and its free cash flow (FCF). If the cash position is lower (or the net cash position after any debt raise), and/or if the FCF is still super negative like last quarter, TLRY stock will not rise. It will likely keep falling.

In these kinds of situations, I like to see where the stock will actually bottom out before investing. For example, this is essentially a turnaround investment for anyone buying the stock. And we all know this from Warren Buffett: turnarounds rarely turn around.

On the date of publication, Mark R. Hake did not hold any position (either directly or indirectly) in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Mark Hake writes about personal finance on mrhake.medium.com and runs the Total Yield Value Guide which you can review here.