Sundial Growers (NASDAQ: SNDL) is losing money despite the stock gaining 28% since February because what is happening is Redditors are pumping the stock. There is a big difference between what Redditors are doing and investing. Investment in Reddit is a game. Although the tactic worked with Gamestop (NYSE: GME) and AMC (NYSE: AMC), it is unlikely to work with SNDL.
In 2020, Sundial’s sales dropped, and they seem to be declining again. The company saw a 26% QoQ and 54% YoY drop to $7.8 million for the March quarter. Surprisingly, over the past four quarters, the pot grower has lost more than $230 million and only generated sales of $42.7 million. SNDL seems to be surviving because of raising cash from the gullible.
For a pot dealer such as SNDL, the struggle is real because weed is a Schedule 1 drug in the US, and there is a thriving illegal marijuana market. SNDL’s hope lies in the hype, and in the weeks to come, it is a stock to watch.