The world needs weed — and for marijuana products manufacturer Tilray (TLRY), that’s both a problem and a source of potential profit.

Last November — just a month after Canada officially legalized the sale of recreational pot —  MarketWatch made headlines with a report on how Canada is facing a “national shortage” of marijuana. Out of the 10 Canadian provinces, authorities in Nova Scotia, for example, said suppliers had delivered only about 40% of the marijuana that buyers had ordered. In Manitoba, the number was 38%, while Alberta was experiencing the worst cannabis crunch of all — only 20% of orders filled.

Of course, that was then, and this is now. But as a report out of Eight Capital makes clear, now the situation isn’t all that much better than it was then. Eight Capital’s Graeme Kreindler met with the CEO, CFO, and Chief “Corporate Development Officer” of Tilray last week, and he came away convinced that lack of supply remains a problem for Tilray — but not one the company is necessarily eager to remedy.

That statement may need some explaining.

Tilray, you see, grows marijuana — but not as much as its rivals do, preferring to source the bulk of its supply form wholesale sellers of legal cannabis, then process that cannabis into a variety of cannabis-infused consumables and other products.  To date, says Kreindler, finding sufficient high quality marijuana to use in its products “has been a challenge” for Tilray. But while you might think the natural reaction to this challenge would be to expand production to secure sufficient supply to meet its needs vertically, this is not the approach Tilray is taking.

The company has added about 15,000 kilograms of production capacity to its High Park Gardens facility in Canada, and is building out production capacity in Portugal to support its move into the European market. But in the long term, Tilray continues to believe that oversupply will be the big trend in the Canadian cannabis market — and it doesn’t want to sink too much of its capital into expanding production of a commodity that will one day end up in oversupply.

And that makes sense. After all, Tilray has less than $90 million in net cash on its books, and is both operating and free cash flow-negative. As such, the company needs to husband its cash.

Perhaps even more importantly, if Tilray is right in its long-term prediction of oversupply being the defining trend in marijuana production, and if that trend results in declining prices for wholesale marijuana, then it makes sense for Tilray to allow its rivals to overproduce — then buy its marijuana from them on the cheap.

So where is Tilray focusing its efforts? Kreindler believes Tilray will avoid investment in “retail and cultivation assets” and focus instead on building out its branded consumer products. In particular, the analyst notes that the company’s purchase of Manitoba Harvest — the largest  hemp-based food manufacturer in the world — has given it a “trusted brand” to build on. In combination with the company’s “Authentic Brands Group” brand, Kreindler reports that Tilray will have access to 20,000 retail storefronts, including names such as CVS, Costco, Amazon and Kroger, through which it can sell its products in the future.

Assuming, that is to say, Tilray can get its hands on enough marijuana from which to make those products in the first place.

Kreindler rates Tilray stock a Neutral with an $85 price target, which implies nearly 64% upside from current levels.