The Wild Child Of The Week - MGT Capital Investments

Loading...
Loading...
It seems that every week, there is one more issues that blast on to the trading scene. Often there is news on the issue and attracts the fancy of day traders, the algorithmic and HFT crowd and one should not be surprised if a few hedge funds jump into the fray to make a quick buck. The award for the most frenzied trading so far this week belongs to MGT Capital Investment
MGT
, Actually, the action started last Monday, when the issue hit the wires for the first time since November 13, On that day, the company posted a Q3 EPS loss of a dime on on a whopping 90K in sales. In its Q4 report, the company showed a loss of ($0.06 with no reported revenues. What initially set the issue in motion was the announcement that the company acquired Computer Security Software from D-Vassive for 23.8M share of stock. That did not really move the needle as the issue posted a modest increase from $0.36 to $0.49. The momentum carried over into the next two session to close at $1.27 on Wednesday. With each day the volume increasing significantly, thrusting the issue onto trading scanners worldwide. Investors acted nonchalantly last Thursday to the news that the company had purchased an ownership interest in Round House, interestingly no terms were disclosed. It added $0.25 on Thursday and ended the week $1.72. Once the weekend scanners kicked in, it was off to the races, rallying to $2.96 on Monday, $4.15 on Tuesday and may have peaked today. Off the open, it reached $5.58 and in now back under $4. Streetsweeper interrupted the rally on Tuesday, when it issued a negative report on Tuesday afternoon, but that just added to the volatility. The issue shrugged off the warning," that a wacky ex-millionaire (John McAfee) is using a shell company to buy the company he already owns even though his private company is worthless." Investors shoould be aware that McAfee retweeted on May 9, that he was named CEO of MGT. Initially it shrugged off the report and after a brief decline continued with upward trajectory that did not end until today. The price of the issue at the time of the initial tweet was $4.54 and declined to $3.69 before ending Tuesday's session at $4.15. Despite the blow-off rally to $5.58 in today's session, the issue is nearly $1 lower than when it was attacked by Street Sweeper. The issue on track to topple Tuesday's monster volume of nearly $110M as 70M shares have traded with over three hours remaining in the session. The bearish report is resonating with traders in today's session and little known Aqua Research has tweeted negative comments on the company. Also, Streetsweeper has issued a brand new report and the the company has reportred a 5.01 percent stake in Venaxis in its 13D. At this time, investors in the issue over the past week are beginning to seriously evaluate whether the recent fundamental news in the company has justified the huge price appreciation since May 6. At its peak in today's session it was nearly 1500 percent above its May 6 close of $.36. The issue is now over $2 off it high and is trading lower by $1 at $3.15.
Loading...
Loading...
Posted In: Short SellersTechnicalsIntraday UpdateMoversTrading IdeasTheStreetSweeper
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!

Loading...