Sundial (NASDAQ:SNDL) is experiencing a halo-effect alongside its sector peers, up nearly 30% in trading today today after competitor Tilray (NASDAQ:TLRY) announced a new medical cannabis distribution deal. Trading volume in Sundial was more than double the daily average at the time of writing, with more than 1 billion trades today.
That deal would introduce Tilray’s products to the U.K. market for availability via the National Health Service. Those products are expected to be available for purchase starting next month.
While Tilray’s news may be the timeliest catalyst, it’s also worth noting that Sundial recently entered the top 10 most popular holdings on Robinhood. While SNDL doesn’t have high short interest, like a number of stocks that have been popular in recent weeks, The Motley Fool speculates that its status as a penny stock makes it attractive to younger investors as a cheap bullish play on legalization.
This all plays out against a background of wider support for marijuana legalization, both from voters and legislators. The sector has been largely bullish since November’s U.S. elections, which saw multiple states legalize cannabis. January’s Senate runoff elections in Georgia sparked renewed interest in the sector as Democrats regained control of Congress and Majority Leader Senator Chuck Schumer recently announced legalization would be a legislative priority this year.
On the date of publication, Vivian Medithi did not have (either directly or indirectly) any positions in the securities mentioned in this article.