Cramer Slams Sundial As Cannabis Company Raises Over $89M Via Warrant Exchange

Sundial Growers Inc. SNDL reported Friday that it has raised $89.1 million via a warrant exchange.

The company noted that holders of 98.33 million warrants to buy shares of the company will exercise for cash their warrants at prices of 80 cents and $1.10 for gross proceeds to the company.

In return, Sundial is supposed to issue 98.33 million new warrants, each enabling the holder to buy one share at a price of $1.50.

The new warrants have immediate exercisability and a 42-months term from the date of the registration statement.

Sundial’s Recent Share Price Jump

The Canadian cannabis producer has been grabbing headlines recently on the heels of its stock going through a similar rollercoaster akin to GameStop GME.

Together with cannabis stocks — Tilray Inc. TLRY and Aphria Inc. APHA — Sundial experienced a short-lasting price jump. Its shares spiked 79% last Wednesday, Tilray soared 51%, and Aphria jumped 11%.

By the next day, all three stocks plummeted, Sundial by 19%, Tilray by 50%, and Aphria by 36%.

On Friday, both Sundial and Tilray continue to fall, losing 12.61% and 9.83%, respectively, while Aprhia had a small gain of 0.36%.

Cramer Called It A ‘Pump And Dump Stock’

This activity in cannabis stock reached attention from Mad Money host and founder of The Street, Jim Cramer, who used it to explain how to “spot a pump and dump stock” on TheStreet Live last week.

According to Cramer, Sundial is the perfect example of a “pump and dump” stock, or a stock that uses “an illegal scheme” to cause a jump in the stock’s price via misleading announcements. (h/t The Street).

What’s more, Cramer emphasized that the government should get involved and follow these stocks closely in order to help protect retail investors.

On last Friday, Cramer tweeted about the company asking – “Has anyone currently 'trading' Sundial even been on their site?”

Yesterday he posted:

Sundial’s Other Recent Moves

Last week, on Thursday, Sundial confirmed a strategic move - $22 million investment into a cannabis edibles producer Indiva Ltd. NDVA NDVAF.

On Friday, the company announced it has reclaimed compliance with the Nasdaq Stock Market’s minimum bid price demands to remain listed on the exchange.

Cramer Strikes Again

In his latest Tweet on Thursday afternoon, Cramer commented Sundial once again – “The Sundial story has devolved into what i most feared..”

At the time of writing, Sundial’s shares were down 5.17% at $1.38 per share.

Market News and Data brought to you by Benzinga APIs
Posted In: CannabisNewsMarketscannabis industrycannabis salesCramer Attacks SundialCramer on SundialCramer Tweets About SundialgamestopJim Cramerlegal marijuanamarijuanamarijuana stockspremiumPump and Dump Stock SundialSundail raises $89.1 millionSundial Invests $22 million into edibles producerSundial Invests In IndivaSundial Price JumpSundial reclaimes compliance with Nasdaq Stock MarketSundial To Remain Listed On NasdaqSundial TradingSundial warrant excahngeThe StreetTheStreet LiveTilray Aprhia Sundial Shares Spike
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!

The Top Cannabis Event In New Jersey

Join the Benzinga Cannabis Market Spotlight in New Jersey on June 17th! Grow your business, raise money and capitalize on the booming NJ recreational market. Don’t miss this must-attend event in New Brunswick. Secure your tickets now. Very few spots are left. Use the code "JAVIER20" for 20% off!