Tilray stock continues to fluctuate more wildly than its peers
The volatile cannabis stock Tilray took a tumble on Tuesday. The price dropped as much as 20 percent on news of PepsiCo’s response to rumors it was in talks to invest in cannabis partnerships. The stock closed 16 percent lower overall while its peers experienced less significant losses.
PepsiCo Chief Financial Officer Hugh Johnson revealed the company’s stance on marijuana during an earnings conference call. Johnson told analyst Vivien Azer PepsiCo has no plans to “do anything” in the marijuana space, pointing to the drug’s federal status as the biggest challenge in the market.
The news affected several leading marijuana stocks including Canopy Growth, which fell by 7.4 percent, and HEXO, which dropped 9.4 percent. The results demonstrate that Tilray continues to be one of the more volatile stocks in its sector.
According to Capital Partners Analyst Scott Fortune, Tilray’s trading action is mostly based on everyday news speculation. Fortune also downplayed the speculation on potential partnerships between Tilray and a leading beverage company, saying he believes it will take more time to happen.
The news was not good for PepsiCo either. The stock lost 1.8 percent on Tuesday. The dip prompted Johnston to tell CNBC later in the day the company plans to look at marijuana partnerships critically.
Tilray is still up over 517 percent since it’s initial public offering in July. It experienced its best day after receiving approval from the U.S. Drug Enforcement Administration to import medical cannabis for research purposes. The stock’s fluctuations are related to investor fears of an impending asset bubble.