What happened
What goes up must come down, especially in the volatile world of marijuana stocks. On Thursday, bellwether sector title Canopy Growth (CGC 2.41%) was hit with a sell-off that reduced its value by more than 5%. This was a notably steeper fall than the 0.3% endured by the S&P 500 index.
So what
Investors often get nervous when insiders sell their shares in the company, and that dynamic seemed to be in play for Canopy Growth. Late Wednesday, a set of regulatory filings revealed that three members of the Canadian marijuana company's board of directors had unloaded some of their holdings.
The most prominent of the trio was the board's chair, Judy Schmeling, who sold 18,703 common shares at a price of 0.71 Canadian dollars ($0.52) apiece. Following the sale, Schmeling's total holding fell to 439,022 shares.
Elsewhere in the boardroom, Canopy Growth directors David Lazzarato and Terry Yanofsky made larger divestitures. Both sold just under 39,000 shares at the same price as Schmeling. Those moves have left Lazzarato with a share count of slightly over 246,000; for Yanofsky, it's a bit higher, at over 250,000.
Now what
Those sales came in the wake of a bull run not only in Canopy Growth stock, but in the publicly traded weed sector as a whole. A new, top-down effort by U.S. government officials -- including President Joe Biden -- to effectively decriminalize marijuana has given fresh hope to investors. Many of the sector's stocks, including Canopy Growth, had withered in the face of the lingering and habitual unprofitability of the business.
