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Zelda Therapeutics Ltd shares rocket 23% higher

The Zelda Therapeutics Ltd (ASX: ZLD) share price has been one of the best performers on the market today.

The shares of the biotechnology company with a focus on developing medicinal cannabis therapies are up a massive 23% to 11 cents.

This is the highest level they have traded at in over six months and have their all-time high of 13 cents within sight.

Why are they higher?

With no news out of the company, today’s gain is a bit of a surprise. However, it is worth noting that up until this week Zelda had missed out on the pot stock buying frenzy.

For example, in the last month the Auscann Group Holdings Ltd (ASX: AC8) share price has gained 72%, the Cann Group Ltd (ASX: CAN) share price is up 98%, the Creso Pharma Ltd (ASX: CPH) share price has doubled in value, and the Hydroponics Company Ltd (ASX: THC) share price has more than quadrupled in value.

Considering these strong gains, Zelda’s shares do look remarkably cheap on a peer analysis basis. I suspect this is what has driven its shares higher this week.

Should you invest?

While I have been impressed with the work that Zelda is doing and believe it could have a bright future ahead of it, until it is generating meaningful revenues I would suggest watching on from the safety of the sidelines.

The pot stock industry certainly is thriving at the moment, but there’s a chance that when momentum slows, share prices could slide lower.

In the meantime I would suggest investors consider these hot stocks instead.

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Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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