Canada has fully legalized marijuana and Mexico is on the verge of legalization with bills being pass through their government. United States has lagged behind both or our neighbors in this revolutionary transformation of drug policy. The drug war of the last four decades failed spectacularly and only increased the amount of addicts and drugs imported across the U.S.
Marijuana legalization has gained tremendous steam through the legislative processes among states. Starting with Colorado in 2012, the dominos started to fall as more states started their decriminalization or legalization of the herb. New York State being the latest example! Where I’m at in Nevada, we are a recreational and medical state, although the legislature has some funny laws regarding private cultivation that can be worked around fairly easily.
What does all this have to do with Sundial Growers ($SNDL)? This is a Canadian firm that made big new by being a darling to the retail traders for a short period of time. Sundial’s products include everything from just smokable flowers to extracts and skin creams. The wide variety of products has led them to build a solid brand and name recognition, but getting the products to the United States is the biggest challenge.
Sundial is an awesome company, but they are burning through cash and running at a net loss of about 206 million in 2020. I bought into some of their stock options when I had FOMO. My options expire in July, so they have some time to turn around the stock price, but I have a feeling as long as they are running a deficit, their stock prices will continue to fall. Currently, it is close to a $1 per share. Although, for the long term investor this might be a fire sale for a company that could do big things in the near future.
How do you feel about marijuana legalization? Do you think this company will continue to innovate and become a dominant player in the cannabis market?