Sundial Growers (NASDAQ:SNDL) stock is in focus today after the Canadian cannabis producer issued its latest financial results.
The update today is welcome news for Sundial Growers and its shareholders. In recent weeks, they have faced concerns that the Nasdaq will delist the cannabis company if it can’t meet minimum listing requirements and keep its share price above $1.
In the past year, SNDL stock has declined 40% to trade at 52 cents a share.
What Happened With SNDL Stock
Sundial Growers reported that its revenue for the fourth and final quarter of 2021 amounted to 22.7 million CAD, an increase of 63% over the fourth quarter of 2020. While the Q4 result was positive, the cannabis producer said that its revenue for all of last year totaled 56.1 million CAD, an 8% decrease from the previous year.
Additionally, Sundial Growers announced a net loss of 230.2 million CAD for 2021, which was 12% greater than the net loss of 206 million CAD from 2020. For investors focusing on Q4, there is room for optimism in SNDL stock. That is because the fourth-quarter numbers show an improving picture at the Calgary, Alberta-based company.
Why It Matters
Despite its struggles, Sundial Growers continues to be a popular stock with retail investors and it has been trending on social media lately as lawmakers in Washington, D.C. again debate legalizing cannabis for recreational purposes at the national level. However, while the House of Representatives continues to pass encouraging bills, they tend to stall or get killed once they reach the Republican-controlled Senate.
Shareholders of SNDL stock also remain concerned about a Nasdaq delisting. Shares must reach and stay above $1 for a sustained period. While today’s news is positive, at 52 cents a share, the company’s stock continues to wallow deep in penny stock territory. Sundial might execute a reverse stock split to raise the share price.
What’s Next for Sundial Growers
SNDL showed today that the company made some progress at the end of last year. However, investors should keep in mind that the entire Canadian cannabis sector is depressed right now due to issues such as oversupply, flat sales and industry-wide consolidation. Shares of most Canadian cannabis producers continue to slide lower as a result, with Sundial Growers being one of the hardest-hit stocks.
On the date of publication, Joel Baglole did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
