Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

Newly minted meme stock darling AMTD slides after eye-popping surge

Stock Markets Aug 03, 2022 11:55AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. Traders work on the trading floor at the New York Stock Exchange (NYSE) in Manhattan, New York City, U.S., August 2, 2022. REUTERS/Andrew Kelly

By Bansari Mayur Kamdar and Medha Singh

(Reuters) - Shares of AMTD Digital Inc ADR (NYSE:HKD) plunged 40% on Wednesday to snap an eye-popping rally fueled by retail investors this week that briefly took the Hong Kong-based fintech's market value past that of Facebook-owner Meta Platforms.

The company's market capitalization closed above $300 billion in a 128% jump on Tuesday, reminding investors of the meme stock mania last year that drove record rallies in shares of companies such as GameStop (NYSE:GME) and AMC.

The stock has risen about 21,000% since its July IPO, when it listed at a price of $7.80. It was trading at $1014.98 on Wednesday.

"It sure looks a lot like a pump-and-dump," Nate Anderson, founder of Hindenburg Research, said, adding that it does not have a position in AMTD Digital. "It seems to have caught on among retail investors, which is often the fuel for these situations."

In a typical pump-and-dump scheme, investors create artificial demand to boost companies' stock prices and then sell their own shares at a profit causing prices to fall, saddling others investors with losses.

AMTD Digital was also the most-mentioned stock on Reddit.com, the social media platform central to the meme stock craze of 2021.

The company said on Tuesday there was no material change or event related to the company's business and operating activities since the IPO date and that it was monitoring the share volatility.

The fintech firm, which provides loans and services to startups in exchange for fees, has a low float and is tightly controlled by parent company AMTD Idea.

AMTD Idea's shares also slid 4% after closing Tuesday with a market value of $2.6 billion.

"(AMTD Digital) is clearly the newest meme stock with bands of retail traders purchasing the stock at the same time, pushing the price sharply higher," said Victoria Scholar, head of investment at Interactive Investor.

There has been a similar, but smaller, surge in some other recently listed U.S. companies, including Getty Images which jumped over 200% since its debut on July 25.

"Should this market rebound have more legs, we expect retail investors' appetite for speculative stocks to continue, as they seek the opportunity to further scratch back the losses they’ve accumulated through the year," said Lucas Mantle, a data science analyst at Vanda (NASDAQ:VNDA) Research.

 

GRAPHIC: Retail investors snap up shares of AMTD and others (https://fingfx.thomsonreuters.com/gfx/mkt/znpnerezovl/Pasted%20image%201659539063394.png)

 

 

 

Newly minted meme stock darling AMTD slides after eye-popping surge
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (4)
Jamie An
Jamie An Aug 03, 2022 12:16PM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Wow, wait a second. China can change that number in dramatic way very soon. minus.
Krzysztof Smith
Krzysztof Smith Aug 03, 2022 10:59AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
What a full of bul *******article. I would like to see where from they got that info that retail push price up.Manipulative propaganda bull *******wrapped in bat *******
Jay Vila
Jay Vila Aug 03, 2022 10:02AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Thee proof MSM is nothing but a propaganda machine for wall st. What a garbage article.
Benjamin werling
Benjamin werling Aug 03, 2022 9:08AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
This isnt pushed by Reddit and is just a fund created to meet margin requirements
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email