How these new IPO* movers performed last week once again proves how volatile shares can be after a stock debut - which means an unpredictable and unreliable source of profits.
ADOMANI Inc. (Nasdaq: ADOM) has been the quietest stock to move so much. While it tops the gainers last week, we were puzzled the week before when it fell 34.1% on no significant news. This is still a new stock that investors are struggling to value. It held its IPO in June. In spite of last week's surge, ADOM remains about $6 shy of its July high of $17.15. Named after the Italian phrase meaning "see you tomorrow," ADOMANI converts school buses and other transportation fleets into zero-emission electric and hybrid vehicles. Shares closed the week at $10.55.
Gridsum Holding Inc. (Nasdaq ADR: GSUM) was also quiet on the news front, but climbed steadily to close the week up 22.4%. The Chinese company, which provides data analysis software, has an earnings call coming up this week. Last week's excitement may be in anticipation of a strong report. However, Gridsum has yet to turn a profit and is not expected to have done so last quarter. GSUM closed the week at $8.61, well below its $13 IPO price from last September.
BREAKING: New Legislation Could Turn Tiny Pot Stocks into Millions. Click Here...
Forterra Inc.'s (Nasdaq: FRTA) 46.5% drop came from an ugly earnings report. Earnings per share (EPS) were -$0.02, compared to an expected $0.08. It's the third straight quarter of negative EPS for Forterra. The Texas-based company manufactures pipe and precast products for infrastructure projects. In spite of the company's bad fortunes, Barclays Plc. restated its "Buy" rating on FRTA this week, with a $15 price target. Shares currently trade at $4.55.
Airgain Inc. (Nasdaq: AIRG) fell 27.1% despite beating EPS estimates by $0.04 in its Aug. 7 report. The San Diego-based communications company posted EPS of $0.10, still down 33% from a year earlier. The stock climbed as high as $26.95 late last year after an $8 IPO in August. It crashed in the following month though, and after another steep drop, it closed last week at just $9.50.
*Stocks are listed on a U.S. exchange with an initial public offering in the last year. Data and analytics provided by FactSet.
Up Next: One gallon of this new "crystal fuel" could get you from New York to L.A. and back... seven times! Being hailed by many experts as energy's "Holy Grail," it's 1,693 times more powerful than the gasoline that runs your car. The mainstream investment media isn't even talking about it yet. Read more...
Follow Money Morning on Facebook, Twitter, and LinkedIn.
[mmpazkzone name="end-story-hostage" network="9794" site="307044" id="138536" type="4"]
About the Author
Stephen Mack has been writing about economics and finance since 2011. He contributed material for the best-selling books Aftershock and The Aftershock Investor. He lives in Baltimore, Maryland.