Sundial Growers continues lower as reverse split becomes more likely

 

  • NASDAQ:SNDL fell by 0.42% during Monday’s trading session.
  • ATB Capital Markets remains bullish on Sundial’s stock moving forward.
  • A Cannabis ETF reverse split shows the state of the sector right now.

NASDAQ:SNDL dipped further below $1.00 to start the week as the company mulls over being delisted from the NASDAQ or being forced to perform a reverse stock split. On Monday, shares of SNDL dropped lower 0.42% and closed the trading session at $0.38. Sundial’s stock underperformed the broader markets, as all three major indices managed to eke out a small gain to start the week. The Dow Jones eked out a small gain of 16 basis points, while the S&P 500 added 0.31%, and the NASDAQ rose higher by 0.40% during the session.

Despite Sundial’s stock falling by 40% so far in 2022 and 68% over the past 52-weeks, one Wall Street analyst remains bullish on the stock. ATB Capital Markets analyst Frederico Gomes reiterated his Outperform rating for Sundial and a price target of $0.80. The positive rating comes as another Canadian cannabis giant, Canopy Growth (NASDAQ:CGC), was downgraded by Cannaccord from $6.00 to $4.50 CAD per share following its disappointing quarterly earnings report. According to TipRanks, Canopy has a one Buy rating out of eleven analysts, and a median price target of $5.15.

Sundial stock forecast

The dire state of the cannabis sector right now could be summed up by the Global X Cannabis ETF (NASDAQ:POTX) announcing a reverse split for its fund. While we see this in struggling stocks, like potentially in Sundial, to see an ETF reverse split its shares is nearly unprecedented. The 1 for 6 reverse split will take place after the markets close on June 10th.

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