Cannabis stocks favored by Reddit traders surge again on Thursday

A group of cannabis stocks surged again Thursday as the Reddit trading crowd continues to pile in among the high-profile names.

Shares of Tilray are up 13% in pre-market trading on Thursday, after advancing around 150% this week. Aphria is up over 11% in extended trading, after gaining 57% this week. Aurora Cannabis is up nearly 14% in pre-market commerce after rallying nearly 50% since Monday.

Canopy Growth is up 1% at the start of the session, bringing its weekly gain to over 20%. Sundial Growers is up 50% in pre-market trading after a 160% weekly gain.

The cannabis group of companies is drawing the attention of the same WallStreetBets Reddit army that helped GameStop’s epic squeeze last month. Members of social media posted about their profits in pot stocks and encouraged other traders to join the rise.

“Here we go my! TLRY to the moon !!!” said an article Thursday.

“Weedstocks, the new darling of the WSB,” another article said Thursday.

Part of the discussion on Reddit centered around the ongoing merger between Tilray and Aphria. Other social media users mention the decriminalization of the plant at the federal level under the new administration.

The movement of pot stocks could also be linked to high short interest ratios, which measure the number of traded shares of a company that are used in bets against the company. GameStop and AMC Entertainment have been targeted by retail traders in part because their high interest in short selling makes stocks attractive for so-called short squeeze. Tilray’s short interest is equal to 22.5% of the shares available for trading, according to FactSet.

Certainly, some of these retail investors are holding onto these stocks since their price action in 2017 and 2018 and expressing optimism about new interest from other investors.

Several analysts who cover cannabis companies told CNBC on Wednesday that price action this week had little basis in fundamentals.

To subscribe to CNBC PRO for exclusive news and analysis and live business day programming from around the world.