Cannabis stocks have a nice buzz this morning after the House of Representatives again approved legislation that would provide safe harbor for financial service providers to work with pot businesses otherwise in compliance with state laws. Sundial Growers (NASDAQ:SNDL) shares are up 7% in morning trading after gaining more than 11% on Monday.
The irony of stoked pot stocks today, of all days, hasn’t been lost on social media chatterers. April 20, or “420” in pot parlance, is informally recognized as something of a national holiday for cannabis culture.
The House passed the Secure and Fair Enforcement Banking Act by a vote of 321-101, including a majority of voting Republicans. “For the first time since Joe Biden assumed the presidency, a supermajority of the House has voted affirmatively to recognize that the legalization and regulation of marijuana is a superior public policy to prohibition and criminalization,” said NORML Political Director Justin Strekal, according to Green Market Report.
Global spending on legal cannabis worldwide will hit $57 billion in a decade, according to Arcview Market Research and BDS Analytics, Yahoo Finance reported. Driven by the legalization of recreational and medical cannabis and the increasing demand for both, legal cannabis revenue in the U.S. is projected to hit $23.4 billion by 2022.
Cannabis Stocks: SNDL Stock Remains Reddit Fave
Canadian cannabis company Sundial Growers has been a favorite among Reddit penny stocks. Retail investors who frequent the Reddit commentary boards pushed SNDL stock up to an all-time high of $3.96 per share in February. SNDL stock has since crashed back down to its current level of below a dollar. But investors haven’t completely abandoned Sundial Growers.
However, InvestorPlace contributor Josh Enomoto this morning voiced his concerns about SNDL stock. Primary among his issues with Sundial is management’s recent moves to cut debt and expenses when the pot grower, as a growth company, should be spending money.
More broadly, cannabis corporates are encouraged by the movement on Capitol Hill. Green Market Report quoted Medical Marijuana (OTCMKTS:MJNA) CEO Dr. Stuart Titus said, “Though the cannabis industry has been deemed ‘essential’ during the pandemic, it still mainly operates as a high-liability, cash-only business. We’ve been looking forward to the passage of the SAFE Banking Act for nearly a year but with Democrats now in control of the House, Senate and White House, it’s finally happened.”
On the date of publication, Robert Lakin did not have (either directly or indirectly) any positions in the securities mentioned in this article.
InvestorPlace contributor Robert Lakin is a veteran financial writer and editor, including previous stints with Bloomberg News, McKinsey & Co. and McDonald & Company Investments.