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Winnipeg - Investors’ collective high over Canada’s burgeoning marijuana industry has evaporated, to be replaced by a comedown.
Marijuana stocks tumbled on Friday amid a wave of “panic-selling" and concern that companies that had seen ballooning share prices recent are now overvalued.
The BI Canada Cannabis Index plunged as much as 19%, its biggest intraday drop on record, while the nation’s biggest producers, including Canopy Growth and Aurora Cannabis, have tumbled more than 40% from their January highs.
“There’s a lot of investors that got in in the last month and many of them are looking at significant losses,” PI Financial analyst Jason Zandberg said by telephone.
“It now looks like it’s a pile-on. There’s a bit of panic selling.”
Shares of Canopy tumbled as much as 16% in Toronto to the lowest intra-day price in six weeks, while Aurora dropped 17% and Aphria 14%.
“People are panicking because they are losing their money,” Chris Damas, editor of the BCMI Cannabis Report, said in an email.
“Stocks are in bear market territory.”
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