Cannabis Penny Stocks: Why are so Many in the Red Today?

Penny Stocks

With one week to go before cannabis is legalized across Canada, is it worrisome that cannabis penny stocks are in the red? 

Cannabis Penny Stocks: A Sea of Red

Across the marijuana board, stocks are a sea of red. It’s a sorry sight to see this close to such a momentous occasion for this industry.

Today we will look at two cannabis penny stocks that represent the lull across the market right now: Vivo Cannabis (TSXV:VIVO) and Golden Leaf Holdings (CSE:GLH).

There doesn’t seem to be any major catalyst for this stagnation but let’s have a look.

Vivo Cannabis

On October 4th, Vivo entered an agreement with Pharmascience Inc. to develop products containing cannabis for medical reasons. Pharmascience is a global pharmaceutical company that holds a Dealers License from Health Canada, and the global potential of this deal should have meant exciting things for Vivo stock.

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And in fairness, it did… for about a day. The stock climbed 5% on the news to $1.52 but then began to decline.

In fact, this cannabis penny stock company has not recovered since its high of $1.89 back in September. Why? 

There is no obvious reason, so perhaps investors are jumping between penny stocks during this volatile time before legalization.

Golden Leaf Holdings

When a cannabis company announces something new, be it a product, deal, or even a new boss, the stocks usually reflect positively on the news. Anything ‘new’ represents movement, and movement means growth to investors—and any savvy investor will want to see a company grow. 

So, okay, a new flavor of CBD oil isn’t exactly a momentous announcement, but I’m still surprised to see that GLH penny stocks dropped on this announcement.

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The company added CBD-only Green Apple flavor as an extension of its cannabis-infused fruit chews product line. The chew offers consumers a restorative effect through the use of clean, hemp-derived cannabidiol isolate and real fruit. So what’s not to love!?

Well apparently, lots.

Since the announcement Golden Leaf stock has dropped and it is currently down 3.77%. The mind boggles.

Is this really a reaction to a new additional flavor? Or are cannabis penny stocks simply having a volatile week?

Or maybe investors just don’t like apple.

Featured Image: Depositphotos/© denisismagilov