STOCKS TELEGRAPH

Tag: stock market

  • Stock definition and types of stocks

    You have often heard the word stock being mentioned on the news, in conversations, or on the internet. It is used in relation to many other terms, some of which are stock market, investing and trading, as well as company growth. Understanding stocks and types of stocks, can help you in the future by learning how to invest in companies and their stocks.

    So let us start by asking the main question “what is a stock? And why is it so much related to investors, corporations, and even the economy?”

    Grasping the concept of stock through an analogy

    Let’s give an analogy to stocks in order to make it easier for you to understand.

    Imagine that you are at a carnival, and you have bought a ticket for a rollercoaster ride. At this carnival, the ticket prices of the rides quickly fluctuate because of the demand for rides and other factors. Suppose you bought the ticket for a rollercoaster ride at a certain moment for $2 and hold on to it. A few moments later, the price of the rollercoaster ride goes up to $3. This increases the value of your ticket by another dollar.

    As more time passes, more and more people show up to demand rollercoaster rides, which drive the price of the ticket up to $5. So now you are making a $3 profit if you sell your ticket to someone else. However, you decide to hold the ticket till late at night hoping to make more profit. Unfortunately, people are not buying tickets for a rollercoaster ride anymore because maybe the rollercoaster ride did not get excellent reviews or is not exciting as people expected. The prices of the rollercoaster’s tickets drop to $1. And now you are at a $1 loss just by holding your ticket for the rollercoaster ride.

    This is an example of how stocks work in the stock market. In this example, shares are like the tickets – while the rollercoaster ride is like a company. The carnival itself can be compared to the stock market or stock exchange where you buy stocks. Just like how each ride has its own tickets in the carnival – similarly, each company has its own stock that is sold on the stock exchange.

    What is the definition of stock?

    So now that you have a general sense of what it is, let’s give you a proper definition. A stock is known as equity, which gives you ownership of a fraction of a company or corporation. The company puts shares out in the stock exchange in order to generate capital and funds through public investment. Remember, the term share means one unit of stock.

    You buy and hold on to shares, hoping to gain profit in a future time period. If the company performs well, and people start demanding more shares, the stock price will go up. However, the company’s performance is not the only reason for an increase in the price. Its performance can increase due to external factors as well.

    The opposite is also true. For any certain reason, the price can also recognize loss after some time. This is just like the loss you incurred in the analogy while holding the rollercoaster ticket at night when its price dropped due to less demand. Now in the real scenario, low stock performance can lead you to face loss through your shares of the company.

    What is stock ownership?

    After listening to this definition, you might ask, “Do I now own a part of the company if I own a portion of its stock?”

    To answer this, let’s use the carnival-ticket analogy again before we give the technical explanation. When you buy the ticket for the rollercoaster ride, you do not own the rollercoaster itself in any way. What you do own is the right to enjoy the ride, which is the service that the owner of the rollercoaster has set for you. What you can only do as a ticket-holder is use the tickets as you please, but you cannot own the rollercoaster or parts of it as assets.

    So similarly if you own shares or a portion of a company’s stock, for example, let’s say you own 20% of the stock. It does not mean that you now own 20% of the company or its assets. What it means instead is that you can only earn the profit from the company which you gain from your 20% share of the stock. In short, what you are is a shareholder and not a company owner.

    What rights are stock owners entitled to

    The differentiation is legally important too because the internal control and functioning of the company’s assets are done only by the management–while the stockholders only have certain rights in the company. These certain rights include the right to vote in shareholder’s meetings, accept dividends from the company (depending on type of stocks) and sell your shares to whomever you wish.

    The dividend is the share of the profit that a company earns through its own business model, which it then divides among the stockholders. However, corporations can decide to use this profit of theirs to reinvest back into the company’s growth instead of dividing it among shareholders.

    There is, however, one way to indirectly exercise control of a company by being a stock owner. If you own a majority of shares, then your influence on the company can indirectly increase. You gain majority voting power in shareholder meetings and decisions. With this power, you can choose to appoint certain members of the board of directors during a shareholder meeting. This can change the focus and mission of the company to a certain extent.

    What are the types of stocks?

    Now let’s talk about the types of stocks out there. There are vast types, but the ways these types are divided are based on the following categorical reasons;

    The first-way stocks are categorized is based on the different levels of rights and ownership they provide to stockholders. The second way stocks are categorized is based on the types of industry the companies are based in. If a company is an electric automobile marker, then its stock would be considered EV stock. The third way to categorize is by looking at the total worth of all the shares. This is known as the market capitalization of a company or stock. This consists of small-cap, mid-cap, and large-cap stocks. Finally, stocks are categorized based on the different characteristics and trends of the companies, their shares as well as the trends in the overall market economy.

  • Fundamental Analysis: Principles, Types, and How to Use It

    Fundamental Analysis: Principles, Types, and How to Use It

    If you really want to analyze stocks for investment, especially long-term, then you must know the basics to analyze a stock.

    For doing a fundamental analysis of the stock, all you need is some basic information about stocks and the company.

    Becoming a pro in the stock market means sticking with the basics and getting in and out of the market at the right time.

    Let’s first begin with the definition of fundamental analysis of a stock;

    Fundamental analysis of a stock is used to determine the financial and business health of a company. It’s always important to perform a complete fundamental analysis of the stock before investing if you are planning for a long-term investment.

    Beginners sometimes mix up the fundamental analysis with ‘Technical analysis’.

    Well, technical analysis is a sympathetic approach to finding the entry and exit time stock for intraday trading or the short term.

    So, in the technical analysis, we look into charts, trends, and patterns.

    However, fundamental analysis is the proper tool to get an in-depth look at a company and invest in that firm’s stock, which can give you good returns year after year.

    So, we can say that fundamental analysis is a method of measuring a stock’s intrinsic value by examining related economic and financial factors.

    For this, you need to have a basic understanding of economics and finance.

    If you are to do a fundamental analysis of a stock, you’ll study the factors that can affect the stock’s value, from macroeconomic factors such as the state of the economy and industry conditions to microeconomic factors like the effectiveness of the company’s management.

    Before getting into the factors for doing the fundamental analysis of a stock, let’s briefly pick up the concept of fundamental analysis for a better understanding.

    Investors use various types of stock analysis to determine whether a stock is correctly valued within the broader market.

    The basics of fundamental analysis are to express the originality of a stock and its price.

    If you’re a fundamental analyst, you would go through the stock from a macro to micro perspective.

    The concept of fundamental analysis can easily be applied to any other security.

    Let’s take a fundamental analysis example of this.

    For instance, if you are to buy a bond from the market, you can perform fundamental analysis to evaluate the bond’s value by examining the economic factors such as interest rates and the overall state of the economy, then studying information about the bond issuer, such as potential changes in its credit rating.

    For stocks, the fundamental analysis uses revenues, earnings, return on equity, operating income, profit margin, future growth, and other statistics that determine a firm’s underlying value and potential for future growth.

    This data is pretty easy to find. What you have to do is just open the company’s website and go to the financial statements link. There, you’ll find all the required data.

    The end goal of fundamental analysis is that investors can compare a stock’s current price in order to see whether the stock is undervalued or overvalued.

    And, the returns it will reap in the future!

    What Is Fundamental Analysis?

    If you’ve ever delved into the exciting world of finance and the stock market, you may have come across the term “fundamental analysis.” But what exactly is it, and why should you care?

    At its core, fundamental analysis of a stock is a method used to evaluate the intrinsic value or true value of a company’s stock.

    Instead of solely relying on market trends, charts, or hot tips from your neighbor, fundamental analysis takes a deep dive into the financial health, performance, and prospects of a business.

    By scrutinizing a company’s financial statements, examining its industry position, and evaluating its management team, you gain valuable insights into its true worth.

    This analysis considers both quantitative data, such as revenue, earnings, and debt, as well as qualitative factors like competitive advantage, brand reputation, and market trends.

    But why bother with all this analysis stuff, you ask? Well, by understanding the fundamentals of a company, you can make more informed investment decisions.

    Instead of blindly following the crowd or relying on short-term market fluctuations, fundamental analysis helps you assess the long-term potential and value of an investment.

    You may find yourself questioning why not simply purchase stocks solely relying on popular trends or intuition.

    Sure, you could take that route, but remember, investing isn’t a game of chance. It’s about putting your hard-earned money to work with the goal of growing it over time.

    And that’s where fundamental analysis comes into play, helping you separate the wheat from the chaff in the vast universe of investment opportunities.

    By carefully evaluating a company’s financial health, industry dynamics, competitive advantage, and future prospects, you gain a clearer understanding of its potential for growth and profitability.

    This knowledge equips you with the tools to identify undervalued gems or steer clear of potential pitfalls.

    How Does It Work?

    Fundamental Analysis - How Does It Work

    Now that we understand the essence of fundamental analysis, let’s delve into how it actually works.

    • Examining Financial Statements

      Fundamental analysis aims to determine the intrinsic value of a company’s stock by evaluating its underlying factors and market conditions.

      To kick things off, fundamental analysts roll up their sleeves and dive into a company’s financial statements.

      They meticulously examine the balance sheet, income statement, and cash flow statement, seeking vital clues about the company’s financial health, profitability, and future prospects.

      These documents tell a story about the company’s revenue, expenses, assets, liabilities, and cash flow.

    • Exploring Qualitative Aspects

      Financial statements alone don’t reveal the whole picture. Fundamental analysts are curious creatures. They go beyond the numbers and explore various qualitative aspects.

      They scrutinize industry trends, competitive landscape, management team, product innovations, and any other relevant information that could impact the company’s performance.

    • Considering Macroeconomic Factors

      Furthermore, fundamental analysis of stock takes into account macroeconomic factors, such as interest rates, inflation rates, and geopolitical events.

      These external influences can sway the overall market sentiment and, consequently, affect individual stocks.

    • Employing Tools and Techniques

      Once armed with a wealth of information, fundamental analysts employ various tools and techniques to crunch the numbers, calculate ratios, and assess the company’s value.

      They might use valuation models, such as price-to-earnings (P/E) ratio, price-to-book (P/B) ratio, or discounted cash flow (DCF) analysis.

      These tools assist in determining whether a stock is overvalued, undervalued, or trading at a fair price.

      Ultimately, the goal of fundamental analysis is to make informed investment decisions based on a thorough understanding of a company’s financials, industry dynamics, and broader economic factors.

      It’s similar to putting together a jigsaw puzzle, with each piece carefully examined to create a comprehensive picture of the company’s potential.

    What Fundamental Analysis Tells You About a Stock

    Having gone over the core idea behind fundamental analysis and what it entails, let’s now take a deeper dive into this concept.

    So, what exactly does fundamental analysis tell you about a stock? In short, it provides a holistic picture of the financial health of a company.

    • Gauging Performance and Viability

      First things first, fundamental analysis lets you peek behind the curtains and get a real sense of a company’s financial health and potential.

      It’s not just about the flashy stock price or the latest hype; it’s about understanding the nitty-gritty details.

      By looking at things like earnings, revenue, assets, and cash flow, you can gauge how well the company is performing and if it’s worth your hard-earned money.

    • Revealing the Competitive Edge

      But that’s not all. Fundamental analysis also reveals a company’s competitive edge.

      You get to play detective and uncover important clues about its market share, growth potential, and those special somethings that set it apart from the competition.

      Knowing these secrets can help you decide if a company has what it takes to stay ahead of the game.

    • Spotting Potential Risks and Opportunities

      Now, imagine having all the answers about a company, including the potential risks and opportunities lurking around the corner.

      Well, fundamental analysis of a stock is the next best thing.

      By examining economic indicators, industry trends, and even regulatory factors, you can spot potential roadblocks or windfalls that might impact the company’s future.

      This kind of knowledge arms you with the power to make smarter investment choices and sleep a little better at night.

    What Type of Investor Should Use This Approach?

    Fundamental analysis is a powerful tool in the hands of savvy investors who want to make informed decisions based on the true value of a company.

    While it can be valuable for all types of investors, it particularly shines for those with a long-term horizon and a patient outlook.

    If you’re the kind of investor who believes in the age-old adage of “buy and hold,” then fundamental analysis is your secret weapon.

    This approach delves deep into the financial health of a company, examining its balance sheets, income statements, cash flows, and other essential indicators.

    By thoroughly understanding a company’s fundamentals, you can confidently invest in businesses that you believe have the potential for sustained growth over the long run.

    Long-term investors benefit from fundamental analysis of a stock because it helps them identify companies with strong competitive advantages, solid management teams, and robust business models.

    These investors are not interested in making a quick dime amid short-term trends.

    Instead, they seek to build a portfolio of quality companies that can weather market fluctuations and deliver steady returns over time.

    Another advantage of fundamental analysis for long-term investors is that it helps them make well-informed decisions when the market seems irrational or driven by short-term sentiment.

    By focusing on the underlying fundamentals of a company, rather than being swayed by short-term market noise, you can have confidence in your investment decisions and stay committed to your long-term goals.

    Fundamental Analysis vs. Technical Analysis

    In our journey through the world of fundamental analysis, it’s time to explore an important comparison: fundamental analysis vs technical analysis.

    Both approaches play significant roles in evaluating investment opportunities, but they take different paths to reach their conclusions.

    Let’s delve into the core differences between these two fascinating schools of thought.

    Here are the key differences between fundamental analysis vs technical analysis:

    Fundamental Analysis

    Technical Analysis

    Focuses on Company Details

    Fundamental analysis involves assessing various aspects of a company, including its financial well-being, management personnel, competitive environment, and industry trends, in order to gauge its inherent value and potential for growth.

     

    Focuses on Market Data

    Technical analysis primarily studies historical market data, such as price and volume, using charts and patterns to identify trends and predict price movements.

    Considers Long-term Perspective

    It takes a longer-term view, analyzing a company’s financials and growth prospects over years to identify undervalued or overvalued stocks

    Considers Short-term Perspective

    It tends to focus on shorter-term price movements and trading opportunities, analyzing charts with various timeframes, ranging from minutes to days or weeks.

     

    Examines Underlying Value

    Fundamental analysis aims to understand the fundamental value of a company, looking at its financial statements and evaluating its strengths, weaknesses, and overall prospects.

     

    Relies on Market Behavior

    Technical analysis believes that historical price movements repeat themselves and that patterns in market behavior provide insights into future market trends.

     

    Looks at Qualitative and Quantitative Factors

    It considers both qualitative factors, such as management strategies and brand reputation, and quantitative factors, such as earnings, revenue, and cash flow.

     

    Uses Visual Tools and Indicators

    It employs charts, indicators, and patterns to identify buy or sell signals, such as support and resistance levels, moving averages, and trend lines.

     

    Quantitative and Qualitative Fundamental Analysis

    When it comes to analyzing investments, fundamental analysis of a stock is the go-to approach for many savvy investors.

    Within the fundamental analysis, there are two main branches that investors rely on quantitative and qualitative analysis.

    Let’s explore the core differences between these two approaches in the context of fundamental analysis:

    Quantitative Analysis

    Qualitative Analysis

    Nature of Analysis

    		 As the name suggests, quantitative analysis involves crunching numbers and working with quantitative data. It focuses on analyzing financial statements, key performance indicators, and historical data to evaluate the company’s financial health and performance.  

    On the other hand, qualitative analysis delves into the subjective aspects of a company. It involves assessing non-financial factors such as a company’s competitive advantage, brand reputation, management quality, industry trends, and overall business strategy.

     

    Qualitative analysis seeks to understand the intangible aspects that can impact a company’s long-term prospects.

     

    Data Sources

    		 This approach relies heavily on numerical data derived from financial reports, including balance sheets, income statements, and cash flow statements. Analysts use financial ratios, such as price-to-sales (P/S) ratio, return on equity (ROE), and debt-to-equity ratio, to evaluate a company’s financial performance and compare it with industry benchmarks.  

    Qualitative analysis draws information from a wide range of sources beyond financial statements. It involves studying industry reports, market trends, news articles, management interviews, and even customer feedback.

     

    This approach requires a deeper understanding of the company’s business model, competitive landscape, and potential risks or opportunities that may not be evident from financial data alone.

     

    Emphasis

    		 The focus of quantitative analysis is primarily on numbers and financial metrics. Analysts use mathematical models and statistical techniques to derive insights from historical financial data. This approach allows for a more objective evaluation of a company’s financial performance, making it easier to compare and benchmark against industry peers.

     

    		  

    In contrast, qualitative analysis puts more emphasis on the narrative surrounding a company. It seeks to understand the company’s story, its vision, and how it fits into the broader market context.

     

    Qualitative factors like management’s expertise, brand perception, customer loyalty, and competitive advantages can have a significant impact on a company’s long-term success, often beyond what numbers can reveal.

     

    Interpretation

    		  

    Quantitative analysis is more objective in nature, as it deals with concrete numbers and data. Financial ratios and metrics provide a standardized framework for analysis and facilitate comparisons across companies.

    		  

    Qualitative analysis involves a higher degree of subjectivity and interpretation. Factors like management quality, industry dynamics, and brand perception can be open to individual interpretation.

     

    While this flexibility allows for a more holistic assessment of a company, it also means that different analysts may have varying opinions about the same company.

     

    Qualitative Fundamentals to Consider

    When it comes to the fundamental analysis of a stock, there are several qualitative factors you should take into account before making investment decisions.

    Qualitative Fundamentals to Consider

    Let’s delve into some of these crucial aspects:

    • The Business Model

      Understanding the company’s business model is like having a roadmap for its success. Does it generate consistent revenue streams?

      Does it have a clear value proposition? A strong business model lays the foundation for sustainable growth.

    • Competitive Advantage

      What sets the company apart from its competitors? Does it have some unique offerings?

      A competitive advantage can be anything that gives the company an edge, whether it’s a strong brand, patented technology, or superior customer service.

    • Management

      Behind every successful company, there’s a capable management team. Assess the leaders’ track records, their experience, and their vision for the future.

      Good management can drive innovation, navigate challenges, and create long-term value for shareholders.

    • Corporate Governance

      Strong corporate governance ensures that the company is managed ethically and transparently.

      Look for a well-defined board structure, independent directors, and clear policies regarding executive compensation and shareholder rights.

      Robust governance practices can foster trust and protect your investment.

    • Industry

      The industry in which a company operates plays a crucial role in its potential for success.

      Consider the industry’s growth prospects, competitive landscape, and regulatory environment.

      A deep understanding of the industry dynamics can help you evaluate a company’s position within its market and anticipate future opportunities and risks.

    Quantitative Fundamentals to Consider: Financial Statements

    Now, let’s turn our attention to the quantitative side of fundamental analysis and explore the financial statements that provide valuable insights into a company’s financial health.

    These statements are the backbone of any analysis, so let’s break them down:

    • The Balance Sheet

      Consider the balance sheet as a static representation of a company’s financial status at a particular moment in time.

      It displays the company’s assets, liabilities, and total equity of shareholders.

      By examining the balance sheet, you can assess the company’s liquidity, solvency, and ability to meet its obligations.

    • The Income Statement

      Also known as the profit and loss statement, the income statement reveals a company’s financial performance over a specific period.

      It highlights revenues, expenses, and ultimately, the net income or loss.

      By analyzing the income statement, you can evaluate the company’s revenue growth, profitability, and cost management.

    • Statement of Cash Flows

      While the income statement focuses on profitability, the statement of cash flows emphasizes the company’s cash flows over a specific period.

      It tracks the sources and uses of cash, categorizing them into operating activities, investing activities, and financing activities.

      By examining the statement of cash flows, you can assess the company’s ability to generate cash, manage its investments, and meet its financing needs.

    Fundamentals Analysis Strategies

    So, now that we have a good grasp on what fundamental analysis of a stock is all about, let’s dive into some common strategies that investors use when applying this approach.

    Fundamentals Analysis Strategies

    These strategies can help you make more informed investment decisions based on the fundamentals of a company. So, let’s get started:

    • Growth Investor’s Strategy

      Picture this: you’re on the lookout for companies that are poised for rapid expansion and growth. Well, growth investors are just like that.

      They focus on finding companies with high potential for future growth in terms of earnings, revenues, or market share.

      These investors believe that by investing in companies with solid growth prospects, they can ride the wave of success and earn substantial returns.

    • Value Investor’s Strategy

      Now, let’s meet the value investors. These folks are on a hunt for undervalued stocks that they believe are trading below their intrinsic value.

      They’re like bargain hunters in the stock market.

      Value investors look for companies that may be temporarily out of favor or overlooked by the market but have strong underlying fundamentals.

      They believe that by buying these undervalued gems, they can potentially enjoy significant gains when the market realizes their true worth.

    • Screening for Growth or Value

      When it comes to screening, it’s like searching for the perfect fit among hundreds or even thousands of companies and funds, making a choice between growth or income.

      Growth investors use screening techniques to identify companies that exhibit robust growth metrics, such as high revenue growth rates, increasing earnings, or expanding market presence.

      On the other hand, value investors employ screening methods to uncover companies that appear undervalued based on key value indicators like low price-to-earnings ratios or attractive price-to-book ratios.

    • Growth Screening

      For growth-oriented investors, growth screening involves identifying companies with the potential to achieve rapid and sustainable growth.

      These screenings often consider factors such as historical and projected earnings growth, revenue growth rates, industry trends, and competitive advantages.

      By using these criteria, growth investors can narrow down their options and focus on companies that align with their growth-focused strategy.

    • Value Screening

      When it comes to value screening, investors are on the lookout for companies that are trading below their perceived intrinsic value.

      This screening process involves assessing various valuation metrics, such as price-to-earnings ratios, price-to-book ratios, dividend yields, and other relevant financial ratios.

      By screening for value, investors can uncover potential opportunities where the market may have overlooked the true value of a company, providing a potential margin of safety and room for future appreciation.

    Example of Fundamental Analysis

    To truly contextualize the idea of a fundamental analysis of a stock, let’s take a look at a fundamental analysis example.

    Let’s say you’re considering investing in ABC Manufacturing, a well-known company in the automotive industry.

    To conduct a fundamental analysis, you would start by examining the company’s financial statements, such as its income statement, balance sheet, and cash flow statement.

    Looking at the income statement, you observe that ABC Manufacturing has consistently increased its revenue over the past three years.

    This indicates a positive growth trend, which could be a good sign for investors.

    You also notice that the company’s net profit margin has been steadily improving, suggesting efficient cost management.

    Moving on to the balance sheet, you see that ABC Manufacturing has a strong cash position and minimal debt.

    This indicates financial stability and a lower risk of defaulting on obligations.

    Considering the industry outlook, you discover that the demand for electric vehicles is projected to surge in the coming years.

    ABC Manufacturing has recently invested in electric vehicle technology, positioning itself well for future growth.

    Based on the findings of this fundamental analysis example, you might conclude that ABC Manufacturing shows strong financial performance, solid balance sheet health, and promising prospects in an expanding market.

    This positive fundamental analysis could influence your decision to invest in the company.

    Conclusion

    Always remember this thumb rule, invest in stocks of those companies with a debt-to-equity ratio of less than one.

    You can use this ratio in the initial screening of stocks or else check it while reading the financials of a company.

    Last but not least, in this fast-moving world of technology, always consider the future prospects of the company while examining the investments of that company.

    Therefore, always invest in a company with strong long future prospects. Select only those companies whose products or services will still be used twenty years from now.

  • Iterum Therapeutics plc (ITRM) stock drops in Pre-Market today : Here’s to know why

    Shares of the Iterum Therapeutics plc (ITRM) stock were dropping in the pre-market trading session today on July 28, 2021, after rising to a good height in the last trade. ITRM stock price saw a decline of 6.88% to drop at $0.69 a share at the time of this writing. The penny stock went high by 17.53% at the previous closing. Let’s try to figure out the reason behind this fall.

    What’s Happening?

    Iterum Therapeutics plc is the clinical-stage biotechnology stock that develops anti-infectives to treat infectious diseases that cause due to multi-drug resistant pathogens.  ITRM stock is falling in pre-market today despite any obvious reason related to it. No specific news or announcement in today’s date is available to justify the bearish sentiment. ITRM stock dropped 68.73% in the last 30 days and in the past 12 months, the penny stock dropped by 32.64%. Let’s take a look at some recent events of the Iterum.

    ITRM stock received Response Letter from FDA:

    Iterum stock received a complete response letter(CRL) from U.S Food and Drug Administration for its new drug application(NDA) oral sulopenem on July 23, 2021. The FDA did not approve the new drug application in its present form. According to CRL, FDA acknowledged the significant statistical data of the overall response rate of the oral sulopenem against ciprofloxacin in the population resistant to ciprofloxacin. However, FDA mentioned in the CRL that this data is not sufficient and demanded additional data for the approval of the drug.

    FDA recommendations to ITRM stock:

    The FDA recommended Iterum stock to conduct at least one more well-controlled and adequate clinical trial by using a different comparator drug. Moreover, the recommendations also included a nonclinical investigation of the NDA in order to determine the optimal dose prescription. However, this recommendation was not connected with approvability of the drug.

    Financial View of ITRM stock:

    According to the first quarter 2021 financial results, Iterum stock suffered a net loss of  $98.9 million as compared to a $16.1 million net loss in the same quarter of the prior year. The penny stock spent $2.5 million and $3.4 million in R&D expenses and general and administrative expenses respectively. At the end of the first quarter, Iterum had $100.5 million in cash, cash equivalents, and short-term investments.

    Wrap Up:

    The penny stock is now red in Wednesday’s pre-market trading session after a strong gain in the last trade. ITRM stock has a market cap of 132.7 million and a 13,786,501 average trading volume.

  • Why is Orbsat Corp. (OSAT) stock gaining in the intraday session?

    Shares of the Orbsat Corp. (OSAT) stock were gaining in the intraday session today on July 27, 2021, despite the absence of any clear news related to it. OSAT stock price saw a surge of 15.83% to reach $6.66 a share as of this writing. The trading volume was 7,553,847 which is well above the average trading volume. Let’s discuss some recent events of the stock.

    OSAT stock Partners with Alibaba:

    OSAT stock’s Global Telesat Communications (GTC) unit signed a partnership agreement with Alibaba, an eCommerce website that Alibaba Group owns and operates. The launch of the new global storefront in one of the largest e-commerce platforms will expand will significantly expand its eCommerce presence. Orbsat is expected to launch its new storefront in the third quarter of the ongoing year. The store will mainly comprise a wide range of satellite IoT and connectivity products.

    Alibaba has more than 26 million active sellers contributing to the business and entertaining the customers across 190 countries in 19 languages. Alibaba receives roughly 340,000 product inquiries on daily basis along with 20,000 RFQ’s.

    Closing of Over-Allotment Option:

    OSAT stock did announce the closing of the over-allotment option on June 28, 2021, which is granted to Maxim Group LLC, the underwriter. The over-allotment option comprised the sale of 432,000 additional shares of OSAT’s common stock for $0.001 per share. This over-allotment option was connected with Orbsat’s previously announced public offering of shares of its common stock that was ended on May 28, 2021. OSAT stock received the net proceeds of $1,983,225 from this offering after deducting the underwriting discounts.

    New Appointment in OSAT stock:

    In the first week of June 2021, Orbsat stock appointed Charles M. Fernandez as the chief executive officer and the chairman of Orbsat Corp. The former chief executive officer took the role of president and started serving as the CEO of Global Operations. Charles M. Fernandez has an experience of more than 30 years in spotting profitable startups and dislocation opportunities

    Wrap Up:

    It seemed that the OSAT stock was bullish without any specific reason. For the past month, the stock is up by 29%. However, its yearly performance was not so much satisfactory. Hence it is better for investors to do deep research before adding this stock to their portfolio.

  • Why is TAL Education Group (TAL) stock rising in pre-market today?

    Shares of the TAL Education Group (TAL) stock were rising in the pre-market trading session today on July 27, 2021, after seeing a major drop yesterday due to the widening of the official crackdown by the Chinese government against for-profit education companies. TAL stock price saw a push of 9.09% to reach $4.80 a share as of this writing. The stock dropped by 26.67% at the previous closing. Let’s discuss more of it.

    What’s Happening?

    TAL Education Group offers K-12 after-school tutoring services to students in the People’s Republic of China. There is no specific news related to TAL stock in today’s date to support today’s bullish sentiment. On the other hand, the Chinese government yesterday announced an extended overhaul for its education sector in order to decrease the education expenses for Chinese families.

    New Rules:

    According to the new rules of Chinese regulators, the Chinese tutoring stock will have to become a non-profit for their survival. They would have no right to generate capital in the stock market and would not be able to invest in any other education-providing entity. Moreover no, new licenses would be granted as mentioned in the official document.

    TAL stock Reaction on new Rules:

    TAL Education will comply with all the rules and regulations that Chinese regulators are imposing on the education sector. However, the management of TAL stock said that the new rules will adversely affect its after-school tutoring services. This would ultimately significantly impact TAL stock’s operations and prospects.

    Analyst View on TAL stock:

    The Goldman Sachs analyst Christine Chao in response to these rules downgraded TAL stock from buy to neutral. Bank of America analyst Lucy Yu downgraded from buy to underperform after the new rules surfaced.

    Conclusion:

    After facing a major drop in the previous trading following the announcement of new rules for the Chinese for-profit education sector, TAL Education stock is climbing again in today’s pre-market. However, things don’t seem to be favorable for Chinese education stocks. The management is looking for possible ways to comply with new rules and regulations. In a nutshell, investors need to be cautious before adding this stock to their portfolio. 

  • Why Tyme Technologies, Inc. (TYME) stock is moving high today?

    Tyme Technologies, Inc. (TYME) stock announced the receival of notification from the United States Patent and Trademark Office that states the grant of additional patent claims regarding Tyme’s metabolomic technology platform. The TYME stock price saw a push of 38.89% to reach $1.50 a share as of this writing. The stock was gloomy at the previous trading session and went down by 2.70%. Let’s deep dive to explore more of it.

    What’s Happening?

    Tyme Technologies, Inc is the biotechnology stock focused on the development of therapeutics related to cancer metabolism in the United States of America. The U.S patent no 11,058,638 which the TYME stock has been granted is related to the delivery of therapeutics to the targeted cancer cells.

    TYME stock Technology:

    The technology of the Tyme Technologies works in such a manner that the tyrosine isomer racemetyrosine fuses a second therapeutic agent in order to create a fusion compound that allows the targeted delivery to cancer cells in a novel manner. This delivery method affirms the metabolic phenomenon in which the cancer cells grow by consuming a high quantity of non-essential amino acids, in which tyrosine is also included. These cancer cells get non-essential amino acids from their surrounding as they themselves cannot make enough of these i.e., amino acids.

    This delivery technology requires further studies which TYME stock is planning to start this year. As it is the investigational procedure of drug delivery in the pre-clinical phase, it is not approved by the U.S for any disease indication.

    TYME stock’s Chief Scientific Officer Remarks:

    The Chief Scientific Officer of the TYME stock considered the delivery technology as the opportunity for Tyme Technologies for the expansion of TYME’s current cancer-metabolism-based approach with a drug delivery platform. He emphasized that this technology would help in the improvement of safety and efficacy of the wide range of anticancer drugs.

    Conclusion:

    Investors are responding to the recent news related to the U.S patent which TYME stock did announce today. The stock is bullish today and the trading volume is well above the average. The delivery technology of TYME is in the early stages but it can leverage itself in the future.

  • Why SigmaTron International, Inc. (SGMA) stock is falling today?

    Shares of the SigmaTron International, Inc. (SGMA) stock were falling in the pre-market trading session today on July 22, 2021. The SGMA stock price saw a decline of 6.99% to drop at $5.06 a share at the time of this writing. In the previous trading session, SGMA stock was green and went high by 7.72% at closing. Let’s discuss more about SigmaTron.

    What’s Happening?

    There seems to be no news related to SigmaTron International in today’s date to justify the bearish sentiment however, SGMA yesterday on July 21, 2021, announced the execution of a definitive agreement and plan of merger with Wagz, Inc which is the privately held pet technology. This merger is the result of the previous announcement that happened last year on  June 4, 2020, in which SGMA stock and Wags, Inc executed the letter of intent in which the proposed business combination was mentioned. This letter of intent has now become the framework for the merger agreement between two parties.

    According to the agreement, the shareholders of Wagz would get 2,443,870 shares issued by SigmaTron which means that the stockholders of Wagz own approximately 28% of SGMA stock and Wagz will operate as the wholly-owned subsidiary of the SigmaTron. It is expected that deal would be closed by the end of September 2021 after reaching certain milestones and meeting the conditions by both parties before closing.

    Forgiveness of $6.3 million loan:

    On July 14, 2021, the SGMA stock did announce the full forgiveness of its Small Business Administration (“SBA”) Paycheck Protection Program loan which was approximately $6.3 million. The forgiveness was received due to  Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) on April 23, 2020. The SGMA stock will do accounting for the forgives in the first quarter of 2022 financial results.

    Financial View of the SGMA stock:

    In the third quarter of 2021 financial results, the revenue was reported $71.5 million compared to $67.4 million in the third quarter of 2020. Net income for the SGMA stock reported $249,268 in the third quarter of 2021 as compared to a net loss of $217,039 in the same tenure of the previous year.

    Conclusion:

    Today’s market sentiment is not in favor of SGMA stock, however, it went high after announcing its recent merger agreement with Wagz, Inc. Recent financial results were positive as compared to the previous year’s same period.

  • Why Standard Lithium Ltd. (SLI) stock is Popping High in Current Market today?

    Why Standard Lithium Ltd. (SLI) stock is Popping High in Current Market today?

    Standard Lithium Ltd. (SLI) stock announced the appointment of Dr. Volker Berl to the board of directors after which the SLI stock price popped high by 15.16% to reach $5.47 a share as of this writing. The trading volume for today at the time of this writing was 1,278,671. SLI stock was down by 7.77% at the previous closing. Let’s deep dive to explore more of it.

    What’s Happening?

    Standard Lithium Ltd is engaged in the development and processing of lithium brine properties in the United States of America. The stock today reported that it has appointed Dr. Volker Berl as an independent director of Standard Lithium Ltd. Berl is an experienced professional having deep knowledge of the chemical industry and profound experience in institutional capital markets. He is the founder and Chief Executive Officer of New Age Ventures.

    As a result of the appointment, Standard Lithium granted 22,500 performance share units, 7,500 restricted share units, and 200,000 incentive stock options to Dr. Volker Berl. The PSUs will be vested after achieving the performance milestones as described in the SLI’s news release of January 18, 2021. The RSUs will be vested quarterly in four equal parts in a time period of twelve months. The first part will be vested on September 30, 2021. The options will be vested immediately and exercisable till July 19, 2026, at an exercise price of $6.08.

    Previous Activity by SLI stock:

    On July 15, 2021, SLI stock did announce that it has delivered its ‘SiFT’ lithium carbonate plant to the El Dorado Arkansas project site. The site is located at LANXESS South Plant facility. Several truck-loads of the modular plant had been sent to the site. It was also reported that the installation team will install a weatherproof structure on the site and then it can or will be hydraulically integrated.

    Wrap Up:

    Investors are responding positively to the recent announcement by SLI stock related to the appointment of Dr. Volker Berl. The stock has a market cap of 675.502 million and the average trading volume is 421,037. In a nutshell, it is much better to analyze fundamentals as well as future growth before adding this stock to the portfolio.

  • Staffing 360 Solutions, Inc. (STAF) stock is Popping High: What’s Going on?

    Staffing 360 Solutions, Inc. (STAF) stock announced improved anticipated second quarter 2021 financial results after which the STAF stock price saw an uptrend of 14.46% to reach $0.69 a share as of this writing. The stock went high by 1.62% at the previous closing. Let’s check out the recent events in detail.

    Second Quarter 2021 Anticipated Financial Results:

    Based on eleven weeks’ good performance through the mid of June in its three operating segments, the STAF stock anticipates revenue growth of 20% over the year which fulfills the growth estimate previously announced in the first-quarter conference call. 20% anticipated gross profit for the second quarter of 2021 is reported today which is also aligned with the previous estimate.

    The anticipated revenue for the second quarter is more than $52 million and $457,000 operating profit is reported as compared to $1.5 million loss second quarter of 2020. STAF’s gross profit recovery and its cost-saving initiatives have driven the gross profit growth. The operating expenses are anticipated to be $8.2 million in the second quarter of 2021 as compared to $9.0 million in the same quarter of 2020.

    Materially Reduced Interest Expense:

    The completion of interest raises in December 2020, February 2021, and April 2021 has materially reduced the interest expense on the income statement of STAF stock. The interest charge of $2.4 million reported in the first quarter of 2020 reduced to $1.2 million in the first quarter of 2021. Similarly, the $2.1 million interest charge reported in the second quarter of 2021 reduced to $1.1 million in the second quarter of 2021. This means the interest charges were reduced by 50% in the first six months of 2021. Consequently, the STAF stock expects positive net income for the second quarter of 2021.

    Loan Forgiveness:

    Staffing stock recently received the notification from small business administration according to which $10 million PPP loan has been forgiven to the Monroe Staffing Services, LLC, which is an indirect subsidiary of STAF stock. Staffing 360 Solutions has applied for the forgiveness of additional PPP loans of $9.4 million and is optimistic that the stock would get the forgiveness for the remaining loans.

    Conclusion:

    Investors are responding to the anticipated second quarter 2021 financial results announced by STAF stock today. The COVID-19 pandemic had badly affected the business, but stock is now in the recovery phase after various cost-saving initiatives. STAF stock cumulative debt reduced to 55% in the last 12 months in which $10 million loan forgiveness is also included. Though the penny stock is improving its balance sheet, still investors need to cautious before adding this stock to their portfolio.

  • Creatd, Inc. (CRTD) stock is falling today: Why is it so?

    Creatd, Inc. (CRTD) stock is falling today: Why is it so?

    Creatd, Inc. (CRTD) stock announced the pricing of a public offering of its common stock after which the CRTD stock happened to be red and stock price saw a downtrend of 15.74% a share as of this writing. The stock went high in the previous trading session and closed with a 4.03% gain. Let’s discuss more about the CRTD stock.

    What’s Happening?

    The announcement of a public offering by the Creatd stock is the main culprit behind the falling CRTD stock price. According to the public offering, 750,000 shares of the CRTD’s common stock would be offered at a per-share price of $3.40 which means that the offering would produce roughly$2.6 million in total. Creatd stock might sell 15% or 112,500 additional shares of its common stock via granting the 30-day option to underwriters. After meeting the customary closing conditions, the offering would expect to end on June 21, 2021. The net proceeds are estimated to be approximately $2.4 million after the deduction of underwriting discounts and commissions. The net proceeds would be used for general corporate purposes by the CRTD stock.

    Creatd, Inc to acquire 55% WHE Agency:

    Yesterday on June 16, 2021, CRTD stock did announce that it has signed the memorandum of understanding via its wholly owned subsidiary Creatd Partners for the acquisition of a 55% ownership stake in the WHE agency. $275,000 in cash $660,000 in stock was specified for this proposed transaction. Creatd stock intends to carry out the definitive agreements in the early phase of the third quarter of 2021.

    The memorandum has expanded the corporate strategy of the Creatd stock via the expansion of its tools and resources for creators. According to the management, the acquisition will benefit both companies in terms of revenues, and WHE is expected to contribute more than $1 million in agency-related net revenue in the next year.

    Launch of ‘Fiction’, a Vocal Community:

    About a week ago, Creatd stock made an announcement of launching the new ‘Fiction’ community on vocals.The purpose of this launch is to showcase the imaginative work of creators. Furthermore, the CRTD stock also announced the world’s first crowdfunding book publisher, Unbound as its official supporter of the Fiction community.

    Conclusion:

    The announcement of public offering is the obvious reason for the falling CTRD stock price. Such rises and falls don’t affect the long-term investors who mainly eye on the stock’s fundamentals, balance sheet, and future developments.