On Monday morning, a Hong Kong penny stock company, SGOCO Group, skyrocketed to over 195%. Retail investors jumped the opportunity, and by 11:45 am Monday morning the stock had risen another 172%. Over the span of the last 5 trading days this once penny stock company has now had a steady increase of over 917%.
Without any news updates or analyst reports, SGOCO Group stock increased more than 500% last Friday – hitting a historic high. Once Reddit and Twitter users got wind of how well this company did on Friday, social media did it once again, similarly to the impact they had on GameStop and AMC stocks holdings earlier this year.
All indications pointing to retail demand single handedly driving up this stock. Twitter and Reddit users were able to put the word out about the SGOCO Group and within a 10 day span the Group went from having trading volumes less than a million shares to a whooping 59 million shares by noon on Monday morning.
SGOCO Group in 2020 made only about $4 million dollars in income, however had a negative gross revenue every year since 2016. Even though the market cap is close to $2.5 billion dollars but the business itself isn’t even close to being as large. Keeping this in mind, as Reddit and Twitter traders continue to stay fixed on this former penny stock, long term investors should stay far from this “meme stock”.