Cannabis stocks have been trading higher since October, following bullish news regarding the legalization of marijuana in the US at the federal level.
Two of the most discussed cannabis stocks on Reddit’s main forums are Tilray – Get Sundial Growers Inc.
Third-party data suggests that the legal cannabis market will reach an impressive $91 billion by 2028, implying an imposing CAGR of 26%.
Since then, Tilray positioned itself as a market leader in Canada and set in motion its long-term global leadership plan.
Also, a few months ago, Tilray purchased cannabis company MedMen Enterprises, which has 24 retail locations in six U.S.
“The investment we are announcing in MedMen securities, one of the most recognized brands in the $80 billion U.S.
In Q3, Sundial posted net earnings of C$11.3 million, which is impressive since profits are still a rarity in the cannabis space.
However, the more important news driving shareholders’ euphoria seems to have been the announcement of a C$100 million share repurchase program.
The buyback program became a hot topic on Reddit’s main forums. This is justifiable, since the C$100 million planned repurchases accounted at the time for almost 10% of SNDL’s market cap of a bit over $1 billion.
According to CEO Zach George, balance sheet strength “enables team to avoid short term pressures while working to improve the quality of our decision making”.
Also, TLRY is one of the most relevant holdings in cannabis ETFs, including YOLO and MJ, at a respective allocation of 5% and 8%.
On the other hand, Sundial has sizeable growth potential, if it can catch up and become a key name in the sector.
Based on positioning in the industry and market cap size, SNDL might be the more volatile stock that pleases traders the most.