QD Chart showing the IPO dip, then the dip on China Regulations. After that a strong trading channel was created. This is the time period when the institutions came into the positions that were reported out in Jan/Feb 2018.
As the reporting period came to a close the channel trading continued with a run up into the ER which broke out to the upside of the channel.
Although the upside breakout was short lived on a weaker than expected ER, it created and held withing a new bullish uptrend, bottoming out around the low 14$'s.
Then came the initial round of tariffs imposed on China. Clear correlation in the chart, pushing the price below the newly formed uptrend and down to the bottom of the formerly established channel.
The additional tariffs pushed the price well below the channel establishing a new all time low of $10.00 during trading.
Additional downside pressure is being added by the threat of the IPO lockup expiration on 4/16. This lockup expiry is a wild card however as the stock is already trading with a very low PE, has already established a recent new all time low. Short interest is up, based on these factors. However there is also the looming $300M (US) stock repurchase program that the annual report showed only a small amount had been used so far. Near $10 PPS, around 24M shares of stock could be repurchased at any time based on the price, so if there is a selloff around or after the lockup expiration date, the repurchase could easily soak up much downside pressure.
If the stock can put a floor in the $10 range, the lockup will be a non-event with the repurchase mitigating it entirely. The stock is beaten down pretty far. More weakness near $10 and shorts will undoubtedly push this lower, however flip side is that if the stock can retest $11 those same shorts will cover...quickly.
The amount of institutional ownership indicates longer term strength at the moment. However if any indicators pop pup showing tariffs having an adverse affect here, big money may start dialing back these positions, if this is seen via new institutional sales, the stock will likely face new all time lows.
However if the stock rebounds in the near term and can get back into the strong trading channel then I think the future gets much brighter here, and quickly as a short squeeze could be triggered.
Good luck!
As the reporting period came to a close the channel trading continued with a run up into the ER which broke out to the upside of the channel.
Although the upside breakout was short lived on a weaker than expected ER, it created and held withing a new bullish uptrend, bottoming out around the low 14$'s.
Then came the initial round of tariffs imposed on China. Clear correlation in the chart, pushing the price below the newly formed uptrend and down to the bottom of the formerly established channel.
The additional tariffs pushed the price well below the channel establishing a new all time low of $10.00 during trading.
Additional downside pressure is being added by the threat of the IPO lockup expiration on 4/16. This lockup expiry is a wild card however as the stock is already trading with a very low PE, has already established a recent new all time low. Short interest is up, based on these factors. However there is also the looming $300M (US) stock repurchase program that the annual report showed only a small amount had been used so far. Near $10 PPS, around 24M shares of stock could be repurchased at any time based on the price, so if there is a selloff around or after the lockup expiration date, the repurchase could easily soak up much downside pressure.
If the stock can put a floor in the $10 range, the lockup will be a non-event with the repurchase mitigating it entirely. The stock is beaten down pretty far. More weakness near $10 and shorts will undoubtedly push this lower, however flip side is that if the stock can retest $11 those same shorts will cover...quickly.
The amount of institutional ownership indicates longer term strength at the moment. However if any indicators pop pup showing tariffs having an adverse affect here, big money may start dialing back these positions, if this is seen via new institutional sales, the stock will likely face new all time lows.
However if the stock rebounds in the near term and can get back into the strong trading channel then I think the future gets much brighter here, and quickly as a short squeeze could be triggered.
Good luck!