You’ve probably seen pot stocks top recent headlines, unless you live under a rock. This week has been massive all around for the cannabis industry, especially those getting ready to take on the new Canadian recreational market.
There are players already teeing up to attack the market once recreational sales start, with some cultivators getting up to 700,000 kilograms of dry product a year in capacity.
Since the actual recreational sales in Canada are yet to start much of the growth we are seeing is based on speculation and valuable partnerships developed pre-market.
Unfortunately, most of the time, what goes up must come down. Tilray, Inc. (NASDAQ:TLRY) is a perfect example of a stock caught in a short-squeeze.
A short-squeeze occurs when a stock with heavy short interest shoots up in price quickly. What happens is the short-sellers begin to panic when a stock goes up in price quickly and they begin to cover their positions resulting in higher buying volume.
Tilray has an incredibly low float around 17 million shares, and a very high short interest. We’ve seen the stock go up over 1000% since their initial public offering on the NASDAQ exchange in July of this year. In the last two days, the stock has lost over 50% of its value as the short-squeeze begins to settle.
Price aside, Tilray does stand to be a big player in the emerging cannabis market. They have shown dedication towards developing a solid manufacturing and supply operation, including approval for cannabis flower and oils in Germany’s medical marijuana market.
The company also boasts a 912,000 sq. ft. growing and processing facility and is currently exporting to Australia, Croatia, Czech Republic, Cyprus and 5 more countries.
Do you think Tilray has seen it’s top at $300.00 a share or is there room for another rally?
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