The marijuana boom has been explosive.

Look at Tilray Inc. (TLRY) for example.

In just weeks, the stock skyrocketed from $29 to more than $235 a share.

Not only is Canadian legalization of marijuana nearing, the company’s medical cannabis product was successfully imported into the United Kingdom for a pediatric patient in need.

The stock ran on news that the U.S. will allow the company to export marijuana.

In fact, the drug, delivered in capsule form, has been approved to treat essential tremors in a clinical trial at the University of California at San Diego.

It shot even higher after CEO Brendan Kennedy told CNBC that the world’s pharmaceutical companies need to think about partnering with cannabis producers as a “hedge” against the space.  "Cannabis is a substitute for prescription painkillers, prescription opioids, and so, if you're an investor in a pharmaceutical company or you're a pharmaceutical company, you have to hedge the offset from cannabis substitution.”

The buzz generated in the press is nothing short of astounding either.

 What’s interesting is that many investors are no longer buying on perceived value.  They’re buying on sheer blind momentum, like sheep.  That’s quite apparent when investors are rushing into a stock that’s up 710% in just weeks.

At $235 a share, the stock is trading at 769x sales, and 493x book, and that is not sustainable.

Investors with FOMO (fear of missing out) need to take a step back and think rationally.

As we’ve seen with other stocks that fly too close to the sun, downside can be swift and deadly to a portfolio.  It’s obvious that investors are becoming far too greedy.  And remember, as Warren Buffett says, “Be fearful when others are greedy.”

When this stock collapses, the fall could be monumental.

Investing is all about spotting true value.  It’s not about chasing what others perceive to be valuable.

That’s why The Cheap Investor has been so successful for more than 37 years.