It’s been a wild and exciting day of trading for the Step One Clothing Ltd (ASX: STP) share price. Step One shares are currently trading at $2.41 each, up a healthy 6.64% on yesterday’s close. But earlier in the trading day, this ASX small-cap share hit an intra-day high of $2.49 a share. That put the Step One share price up just a tad over 10% at the time.
So why have shares of this clothing company been so hot this Tuesday?
Well, let’s get this out of the way. It’s not clear. Oddly for such a big move, there has been no official news or major announcement out of the company today. In fact, we haven’t had any ASX announcements from this company since 2 November.
Step One steps too low?
But that was just a day after Step One actually underwent its initial public offering (IPO). Yes, Step One IPOed back on 1 November. As we reported at the time, Step One’s IPO resulted in the company raising $81.3 million from the placement of its shares at a price of $1.53 each. Its IPO was a lucrative event, with Step One shares rising roughly 86% after just two days of trading, netting its founder Greg Taylor a paper profit of a cool $150 million.
But after an initial few weeks of success that saw Step One shares top out at $3.13 each by 19 November, the company has come back to earth somewhat. Today’s share pricing puts Step One at around 20% below that all-time high, even after the healthy jump we have seen today.
But in its short life so far, Step One has already impressed some ASX investing experts. As we covered late last month, broker Morgans likes what it sees at Step One. This broker rated the company as a ‘buy’, with a 12-month share price target of $3.20. Morgans likes the fact that Step One has unabashed global ambitions, and is watching the company’s US rollout keenly.
Just before the start of December, my Fool colleague Tony also went through Wilson Asset Management analyst Shaun Weick’s bullish views on Step One. Mr Weick pointed to the company’s plans to expand into both sporting and women’s clothing and is also excited about the company’s global expansion plans.
So perhaps some of this sentiment has finally gotten through to investors, who just yesterday would have watched Step One sink to a new post-IPO low of $2.18 a share.
Whatever the reason for today’s share price gains, it’s certainly a great day to own Step One shares.
The post Why did the Step One (ASX:STP) share price rocket 10% today? appeared first on The Motley Fool Australia.
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Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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