Shares of Sundial Growers (NASDAQ: SNDL) fell on Friday after analysts cautioned that the prices of many cannabis stocks had come too far, too fast. By the close of trading, Sundial’s stock’s price was down 12.6% after declining as much as 25.2% earlier in the day.
Fueled by optimism that the U.S. might finally legalize marijuana at the federal level now that the Democrats control the White House and Congress, investors have bid up the prices of many pot stocks in recent weeks. Sundial has been one of the biggest beneficiaries of this trend. At one point on Wednesday, its shares were up more than 500% since the beginning of the year.