The Rally for Cannabis Stocks Grinds to a Halt Amid Uncertainty About Trump Order

Key Takeaways

• Weed stocks dropped Monday afternoon, reversing early gains on hopes President Trump could soon issue an executive order reclassifying marijuana. 
• An expected reclassification from a Schedule I to a Schedule III drug would help companies in the sector reduce their taxes and relax banking restrictions.

Weed stocks aren't flying so high anymore.

Shares of Tilray Brands (TLRY) dropped nearly 5%, Canopy Growth (CGC) slipped 3%, and other cannabis stocks also lost ground in recent trading, reversing early gains amid hopes President Trump could issue an executive order reclassifying marijuana.

The order, seen changing marijuana from a Schedule I to a Schedule III drug, was expected as soon as today, according to reports late last week. Schedule I drugs, such as heroin and LSD, are considered more dangerous compared to Schedule III drugs, a category which includes steroids.

A White House spokesperson told Investopedia Monday afternoon that no final decisions have been made.

Why This Matters to Investors

Reclassifying marijuana as a Schedule III drug would benefit cannabis companies by significantly lowering financial and regulatory pressures.

While marijuana has been legalized on the state level in most U.S. states and territories for medicinal or recreational use, it remains illegal under federal law and its classification as a Schedule I drug restricts research on it as a medicine, with more stringent penalties for illegal activities related to it. 

Changing marijuana to a Schedule III drug would help cannabis companies by lowering their tax burden and open up banking options, allowing customers to purchase marijuana with credit cards.

Related Education

What Stocks Are on the U.S. Marijuana Index?

The Future of the Marijuana Industry in America

With Monday's losses, Tilray Brands have fallen about 15% in 2025 so far, while Canopy Growth shares have lost nearly 40% of their value.

This article has been updated since it was first published to reflect more recent developments.

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