The Clinuvel Pharmaceuticals Limited (ASX: CUV) share price is falling despite positive news in its quarterly report released today.

At the time of writing, the Clinuvel share price is trading at $22.0, down 1.35%.

What’s driving the Clinuvel share price today?

In its quarterly report for the period ending 31 December 2020, the biopharmaceutical company highlighted negative market conditions as a result of COVID-19 impacts.

Nonetheless, Clinuvel expanded both its commercial operation in the US and its research and development program despite the challenging conditions. The company said the expansion went ahead without the use of any equity or debt financing.

And, as hospital and medical supplies face new challenges, Clinuvel was also able to strengthen its business and balance sheet. This was underpinned by record positive cash receipts, leading to increased cash reserves.

Also during the quarter, the company progressed a number of key projects, including TGA approval of the drug Scenesse to treat adult patients with erythropoietic protoporphyria.

The commercial distribution Scenesse in the United States and Europe delivered cash receipts of $5,266,000. Net cash flow from operating activities came in at $1,293,000. This takes the rolling annual cash receipts value to $33 million, the highest since the company began commercial operations in 2016.

Cash receipts where increasing expenditures from net operating activies also increased to $4,111,000. However, the company claimed this was in order to fund future growth.

Management commentary

Commenting on the update, Clinuvel chief financial officer Darren Keamy said:

The continued performance of the group stems from our measured strategy, consistent execution, and treatment demand from both the USA and Europe, which have contributed to a new high in annual cash receipts.

Against the ongoing backdrop of economic uncertainty, and in a quarter where cash receipts are historically lower reflecting the seasonal demand, we have now been able to deliver a positive net cash result in the December quarter, the first since 2017.

About the Clinuvel share price

Despite a stream of positive company announcements, the Clinuvel share price has performed poorly over the past month, dropping 6% lower. It comes as Clinuvel remains one of the most shorted shares on the ASX.

More reading

• Lotus Resources (ASX:LOT) share price tumbles 7% today but is still up 170% in a year
• Are InvoCare (ASX:IVC) shares the ASX version of GameStop?
• Why the MoneyMe (ASX:MME) share price is climbing higher
• Why Bigtincan, Bubs, LiveTiles, & Treasury Wine shares are storming higher
• Atomo Diagnostics (ASX:AT1) posts 709% boost in quarterly cash receipts

Motley Fool contributor Daniel Ewing 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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Lotus Resources Ltd (ASX: LOT) shares are tumbling today, down 6.9% in early afternoon trade after falling as much as 13% earlier in the day. But even with the partial bounce back of the Lotus share price, its falls are still significantly greater than the 2.7% loss seen on the wider All Ordinaries Index (ASX: XAO) at time of writing.

Today’s share price moves come following the release of the company’s quarterly activities report for the quarter ending 31 December.

What did Lotus Resources report this morning?

In an announcement to the ASX this morning, Lotus reported it had completed its restart scoping study, confirming the potential for its Kayelekera Project to support long-term uranium production.

The company indicated a low initial capital cost of US$50 million (AU$66 million), with an initial capital intensity of US$21 per pound of annual production. According to the release, this would make Kayelekera one of the lowest capital cost projects ready to restart uranium production.

Lotus estimates the mine could produce for 14 years, or yield 23.8 Mlbs of U3O8. The company also sees opportunities to lower costs by reducing power and acid recovery costs and upgrading feed ore.

Lotus Resources stated it has identified two priority targets where no historical drilling has yet taken place. Both are within “easy trucking distance” of the mine.

Looking ahead, Lotus plans new exploration work in the next quarter to assess rare earths and rutile potential north of its Kayelekera Project.

Lotus completed a US$5 million capital raising during the reported quarter, with both Australian and North American shareholders taking part. As at 31 December, the company had $19.5 million of cash (restricted and unrestricted).

Lotus share price and company snapshot

Lotus Resources is a uranium and minerals explorer with a 65% interest in the Kayelekera Uranium Project, located in Malawi. According to a scoping study conducted by the company, Kayelekera has the potential to be a long-term uranium mining operation. From 2009 through to 2014 the mine produced approximately 11Mlb of uranium.

Despite today’s sharp fall, the Lotus share price remains up 4% in 2021. Since this time last year, Lotus shares are up an eye-popping 170%. As for investors who had the foresight (or luck) to buy on 24 March following the COVID inspired selloff? They’ll be sitting on a share price gain of 575%.

More reading

• Are InvoCare (ASX:IVC) shares the ASX version of GameStop?
• Why the MoneyMe (ASX:MME) share price is climbing higher
• Why Bigtincan, Bubs, LiveTiles, & Treasury Wine shares are storming higher
• Atomo Diagnostics (ASX:AT1) posts 709% boost in quarterly cash receipts
• Up 400% in 2021, why the Hawkstone (ASX:HWK) share price is rocketing 28% higher

Motley Fool contributor Bernd Struben 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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The S&P/ASX 200 Index (ASX: XJO) may be sinking notably lower on Thursday but the same cannot be said for the InvoCare Limited (ASX: IVC) share price.

In morning trade, the funerals company’s shares were up as much as 10% to $12.65.

The InvoCare share price has since given back some of these gains but is still up a solid 6.5% to $12.25 at the time of writing.

Why did the InvoCare share price rocket 10% higher?

The catalyst for the impressive gain by the InvoCare share price is one of the more stranger ones you’ll see this year.

As you may have read here earlier, traders from Reddit have been rushing in to buy GameStop shares this week in an attempt to crush short sellers and drive its share price significantly higher via a short squeeze.

A short squeeze is what happens when short sellers have to close their positions in a hurry because a share price is going higher. By buying back shares to close positions, the short seller adds to the buying pressure and helps drive the company’s shares even higher.

The GameStop trade has been a huge success for Redditors, with the GameStop share price rocketing higher, leaving hedge funds to nursing huge losses.

But what about InvoCare?

It appears as though short sellers have been closing their positions in InvoCare in a hurry today amid concerns that Australian Redditors could make the funerals company their GameStop.

According to the AFR, Goldman Sachs named InvoCare as the ASX share most at risk of a short squeeze due to its high proportion of shares shorted compared with its average daily volume traded.

Goldman notes that it would take 33 days to unwind all the shorts based on its average daily trading volume. Given just how much buying that would involve and the limited supply, this would almost certainly drive the InvoCare share price notably higher.

It certainly appears to be a dangerous time to be a short seller right now.

More reading

• ASX 200 down 2.3%: Bank shares tumble, InvoCare jumps, IOOF disappoints
• Here are the 10 most shorted shares on the ASX
• Here are the 10 most shorted shares on the ASX
• These are the 10 most shorted shares on the ASX
• Here’s why the InvoCare (ASX:IVC) share price is on the rise today

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has recommended InvoCare Limited. 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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The MoneyMe Ltd (ASX: MME) share price is climbing higher today. This comes after the company released its second-quarter trading update for the 2021 financial year.

During the first 30 minutes of trade, the MoneyMe share price catapulted to an intraday high of $1.475. However, some profit taking has led the digital credit company’s shares to retrace back to $1.45, up 0.4%.

Record results

The MoneyMe share price is reversing the weakening ASX market trend today after reporting a positive set of numbers.

For the period ending December 31, MoneyMe delivered a record $69 million of originations. This amount reflects a 52% increase on the prior quarter and a record $27 million lift on the prior corresponding period. The company said that its closing gross loan book stood at $168.2 million at the end of the calendar year.

Driving the growth trajectory, MoneyMe is continuing attract new customers through its diversified portfolio mix. Just recently, the company launched the List Ready, Rent Ready, and MoneyMe+ products. These new products already accounts for 9% of total book value.

Other established originations include Personal Loans and Freestyle, which represent 54% and 37% of the entire portfolio, respectively. MoneyMe stated that expanding its current offering is the way forward to seize the addressable market opportunity.

Overall, the group achieved revenue of $11.7 million for the second-quarter. The company advised that significant cost of fund reductions is being met. This follows the refinancing of the Velocity warehouse facility announced in November, with the business now using the new Major Bank warehouse facility.

In addition, MoneyMe highlighted that it is focusing on improving its rolling net charge-off rates. It revealed that it has reduced this metric by 4% in the second-quarter, while attaining an average Equifax score to 638. The latter is a credit scoring model, with any number between 580 to 669 considered as fair.

Words from management

MoneyMe Managing Director and CEO, Mr. Clayton Howes, touched on the company’s performance, saying:

We are incredibly pleased with MoneyMe’s results for the quarter, and origination momentum for the different products is setting the business up for high and profitable balance sheet growth. The 52% increase in origination volume reflects exceptional profitable growth and it is exciting to see the new funding warehouse facility delivering a step change to funding costs and increased capacity for growth.

With our core and more recently launched products resonating so well with Generation Now, the innovation pipeline is continuing at pace as we continue to build for massive scale and product diversification opportunities.

About the MoneyMe share price

The MoneyMe share price is down about 4% when looking at a 12-month historical chart. Although the company’s shares dipped to an all time low of 50 cents, MoneyMe shares began their accent in the months following.

From September onwards however, the MoneyMe share price has stabilised around the $1.45 to $1.50 mark.

On the current valuation grounds, the company has a market capitalisation of roughly $248 million.

More reading

• Why Bigtincan, Bubs, LiveTiles, & Treasury Wine shares are storming higher
• Atomo Diagnostics (ASX:AT1) posts 709% boost in quarterly cash receipts
• Up 400% in 2021, why the Hawkstone (ASX:HWK) share price is rocketing 28% higher
• Why the Amcor (ASX:AMC) share price is having a rough start to 2021
• Brokers list the latest ASX shares to buy in this market meltdown

Motley Fool contributor Aaron Teboneras 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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It has been a very disappointing day of trade for the S&P/ASX 200 Index (ASX: XJO) on Thursday. In afternoon trade the benchmark index is down 1.95% to 6,649.2 points.

Four ASX shares that have not let that hold them back today are listed below. Here’s why they are storming higher:

Bigtincan Holdings Ltd (ASX: BTH)

The Bigtincan share price has climbed 4% to $1.11 following the release of its second quarter update. Bigtincan continued its strong form during the quarter and delivered annualised recurring revenue (ARR) of $48.4 million. This represents growth of 50% over the prior corresponding period. Management revealed that this comprised organic ARR of $40 million (up 42.9%) and ARR of $8.4 million from recently completed acquisitions.

Bubs Australia Ltd (ASX: BUB)

The Bubs share price is up 7.5% to 65 cents after reporting an improvement in its performance during the second quarter. For the three months ended 31 December, Bubs reported gross revenue to $12.8 million. While this was a 12% reduction on the prior corresponding period, it was up 36% on its first quarter gross revenue. Bubs also revealed improvements in the corporate daigou channel during the quarter.

LiveTiles Ltd (ASX: LVT)

The LiveTiles share price has jumped 5% to 22 cents following the release of its second quarter update. According to the release, as of the end of December, LiveTiles’ ARR had increased 10.2% year on year to $58.1 million. In constant currency, LiveTiles’ ARR would have grown 23% year on year to $64.7 million. This was driven by customer additions and an increase in average ARR per customer.

Treasury Wine Estates Ltd (ASX: TWE)

The Treasury Wine share price is up 5% to $9.74 despite there being no news out of the wine company. However, a sharp pullback in the Australian dollar may have given its shares a boost. A weaker currency could give its wine exports a lift.

More reading

• Why the LiveTiles (ASX:LVT) share price is avoiding the market selloff
• Here’s why the Bubs (ASX:BUB) share price is surging 10% higher
• Why the Bigtincan (ASX:BTH) share price is jumping higher today
• Will Joe Biden’s election help an Australia-China reset?
• 4 growing small cap ASX shares to watch

James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of LIVETILES FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. recommends BIGTINCAN FPO. The Motley Fool Australia owns shares of and has recommended BIGTINCAN FPO, BUBS AUST FPO, and Treasury Wine Estates Limited. The Motley Fool Australia has recommended LIVETILES FPO. 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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The Atomo Diagnostics Ltd (ASX:AT1) share price dipped yesterday and has remained flat today after the medical device company released its quarterly activity report for the period ended 31 December 2020.

Atomo designs blood-based rapid diagnostic test (RDT) devices. Through the company’s device portfolio, it aims to provide technology that simplifies the blood testing process and reduces errors. The company offers options for both medical professionals as well as for people who require self-testing to manage their health.

Quarterly activity report highlights

According to yesterday’s quarterly activity report, the company brought in a total of $5.8 million in cash receipts for the first half of the FY21. This includes $2.8 million gained during the second quarter, up a whopping 709% from $346,000 in the previous corresponding period.

Sales for the second quarter of FY21 (unaudited) came in around $2.0 million. The company also advised that an additional 259,200 units shipped to one of its US-based customers, Access Bio, aren’t reflected in revenue to date but will be booked as revenue in the third quarter FY21.

Across North America, Europe and Australia, Atomo continues to progress its rapid testing coronavirus technology. This involves activities like pursuing sales opportunities, finalising submissions and gaining associated approvals.

Additionally, the company continues to progress supply agreements pertaining to its HIV tests. New business is expected in the emerging global health market moving forward.

Positioning for growth

According to Atomo’s co-founder and managing director John Kelly, the company is positioning itself for growth. Mr Kelly believes that the current need for coronavirus tests around the world presents significant opportunity for Atomo.

During the quarter, Atomo launched its TGA-approved AtomoRapid COVID-19 antibody test for sale in the Australian market. Total sales for the product were $394,000 across a range of professional testing and corporate channels.

Mr Kelly goes on to note the Biden administration’s recent $50 billion commitment to fund testing across the US. As a result of this, Mr Kelly expects the coronavirus will continue to play an important part of Atomo’s business “for a number of years”.

Atomo share price snapshot

At the time of writing, the Atomo share price is sitting at 29.5 cents per share, giving the company a current market capitalisation of $166.4 million. The Atomo share price has stayed relatively flat in 2021 so far, and is down 24.36% on this time last year. 

More reading

• Up 400% in 2021, why the Hawkstone (ASX:HWK) share price is rocketing 28% higher
• Why the Amcor (ASX:AMC) share price is having a rough start to 2021
• Brokers list the latest ASX shares to buy in this market meltdown
• Gamestop on the ASX? Why GME Resources (ASX:GME) share price rocketed 28% today
• Why IOOF, Kogan, Openpay, & Woodside shares are dropping lower

Motley Fool contributor Gretchen Kennedy 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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The Hawkstone Mining Ltd (ASX: HWK) share price is going ballistic. Shares are up 28.2% in early afternoon trading, putting the Hawkstone share price gains so far in 2021 at more than 400%.

To put that in some kind of perspective, the broader All Ordinaries Index (ASX: XAO) is down 2.4% today and down 0.8% for the calendar year.

Today’s leap for the Hawkstone share price follows the company’s latest lithium mining results.

What did Hawkstone Mining report to send its shares flying?

In an ASX announcement this morning, the United States-focused diversified minerals explorer reported that initial results from metallurgical testing at its Big Sandy project in Arizona revealed lithium recoveries of 90%. Hawkstone reported it was able to remove iron, aluminium and magnesium, with minimal losses of recovered lithium values from leach solution produced from the mineralised material.

The company said its current test work is now focussed on removing sodium and calcium from the leach solution. If successful, this will produce a pure and concentrated lithium sulphate, opening the way to final processing and battery grade lithium carbonate.

Hawkstone engaged Hazen Research to complete the test work, using a 50kg sample of mineralised drill core from the 2019 Big Sandy drill campaign. Final results are expected by the end of February.

Commenting on today’s update, Hawkstone Mining managing director, Paul Lloyd said:

The company is pleased to announce the positive steps being made by Hazen Research in the completion of bench scale testing of the Big Sandy lithium mineralisation, with the aim of producing battery grade lithium and in the process developing a preliminary process flow sheet. With drill approval imminent at Big Sandy, the company will rapidly progress development of the project to realise its full economic potential.

Hawkstone share price snapshot

Just 2 weeks ago, on 14 January, you could have picked up shares of Hawkstone Mining for 1.0 cent each. Today, those same shares are trading for 5.0 cents. Or a gain of more than 380%.

Of course, that’s all water under the bridge now. But offering somewhat of an explanation for its recent impressive run higher, Hawkstone notes, “With Joe Biden now inaugurated as President of the USA, the global investment community has awoken to the potential value of ‘battery metals’.”

More reading

• Why the Amcor (ASX:AMC) share price is having a rough start to 2021
• Brokers list the latest ASX shares to buy in this market meltdown
• Gamestop on the ASX? Why GME Resources (ASX:GME) share price rocketed 28% today
• Why IOOF, Kogan, Openpay, & Woodside shares are dropping lower
• Robust iPhone 12 sales help Apple deliver a record-setting quarter

Motley Fool contributor Bernd Struben 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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The Amcor CDI (ASX: AMC) share price is having a rough start to 2021. At the time of writing, Amcor shares are trading at $14.39, up 0.56% for the day. Even so, that means that Amcor is a good 5.5% below where it started 2021 at when its share price was $15.16.

Until yesterday, the S&P/ASX 200 Index (ASX: XJO) was up around 1.4% for the year. Even on today’s levels, the ASX 200 is down 0.9% year to date.

That means that Amcor is significantly underperforming the broader market, whichever way you look at it. So what’s going on with Amcor share price in 2021 so far?

Who is Amcor?

Amcor is a packaging company best known for manufacturing boxes and other packaging for goods such as food and tobacco, home and healthcare products, and industrial goods.

It listed on the ASX way back in 1969. Today, it is a global company with operations on every continent around the world (except Antarctica of course). It’s even dual-listed on the New York Stock Exchange under Amcor plc (NYSE: AMCR). The company is also a component of the S&P 500 Index (INDEXSP: .INX).

Looking at the Amcor share price, we can see it is a highly cyclical company. If an investor had held Amcor shares since March 2009, they would be sitting on a very respectable return of roughly 324%. However, anyone who held shares since early 2016 would have seen their shares go essentially nowhere.

Despite this, the Amcor share price is still up more than 42% since it reached a 7 year low of $9.87 in March last year.

Why is the Amcor share price having a rough start to the year?

As we touched on earlier, Amcor shares have not joined the party in 2021, falling where the broader market has been mostly rising.

There is no obvious reason why this is the case. The company has made no market-sensitive announcements this year, apart from some standard director forms and regulatory paperwork.

A likely explanation is the rise of the Australian dollar. Since Amcor is an internationally-based company, it is affected by fluctuations of the Australian dollar in foreign exchange markets.

Between 28 December and 26 January, the Aussie dollar has appreciated by more than 2% against the US dollar. That directly impacts a company like Amcor because they get less bang for their buck when swapping US dollars back to Aussie dollars.

 Many investors like to pursue companies like Amcor because they are relatively stable and reliable dividend income payers. Individuals, businesses, and governments need boxes and packaging all of the time. That makes this company useful to investors who favour reliability of earnings. Amcor (unlike most ASX shares) also pays a dividend every quarter.

On current pricing, Amcor is offering a trailing yield of 2.63%. Government bond yields have also been rising over the past month or so, particularly over in the US. That reduces the appeal of dividend shares like Amcor because bonds are simply a safer alternative. This could also be playing a role.

It’s probably a combination of these reasons that explains why we are seeing Amcor sell off over the first month of the year so far.

More reading

• Brokers list the latest ASX shares to buy in this market meltdown
• Why the IGO (ASX:IGO) share price is tanking today
• ASX 200 down 2.3%: Bank shares tumble, InvoCare jumps, IOOF disappoints
• 5 things to watch on the ASX 200 on Thursday
• ASX 200 falls 0.6%

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of and has recommended Amcor Limited. 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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ASX shares are in a free fall but this could be just the time to buy stocks that top brokers are recommending.

Stocks on the S&P/ASX 200 Index (Index:^AXJO) lost $55 billion in value as the index slumped 2.3% during lunch time trade.

This is the sell-off I’ve been waiting for when I suggested a little over two weeks ago to start building a war chest.

ASX sell-off a buying opportunity

This was particularly so for investors, who like me, were fully invested in shares. It pays to have some firepower in reserve for opportunities – and I see this market sell-off as such an event.

Of course, no one knows where the bottom is and the ASX could fall further. But there are stocks already trading in bargain territory and these are the latest picks by leading brokers.

The broker recommendation that’s staying in the fast lane

One stock to watch is the Eagers Automotive Ltd (ASX: APE) share price. Shares in the car dealership crashed 2.7% to $13.06 at the time of writing.

This is despite management issuing a profit upgrade. But Morgan Stanley doesn’t think you should let the dip go to waste as it reiterated its “overweight” (buy) recommendation on the stock.

“APE positively surprised, upgrading 2020 underlying PBT [profit before tax] to A$209.4m,up from A$195-205m PBT guidance in mid-Dec 2020,” said the broker.

“We recently highlighted APE as a key pick into Feb, offering the best potential for raising expectations in 2021.”

The broker’s 12-month price target on the APE share price is $17 a share.

Conviction buy a golden opportunity

The St Barbara Ltd (ASX: SBM) could be another to put on your shopping list. The SBM share price collapsed 4.2% to $2.18 during lunch time trade.

This implies an 84% upside to Goldman Sach’s 12-month price target of $4 a share as the broker reminded investors that the gold miner is on its “conviction list” of ASX stocks to buy.

While St Barbara’s December quarterly production missed expectations by 5% (at 90,000 ounces of gold), Goldman is still convinced the stock is a buy.

The miner’s all-in sustaining cost (AISC) was better than forecast and production at its Gwalia mine is recovering strongly.

“Guidance was unchanged, with the company tracking below the production and above the AISC guidance ranges so far,” said Goldman.

“Improved volumes and grade at Gwalia should drive a stronger 2H [second half].”

This broker buy is a turnaround opportunity for 2021

Meanwhile, the Nufarm Ltd (ASX: NUF) share price is bucking today’s downtrend. The NUF share price jumped 2.4% to $4.77, but UBS says there’s still room for the stock to outperform.

The broker upgraded its price target on the agribusiness to $5.50 from $5.30 a share and restated its “buy” recommendation on this ASX stock.

A better-than-expected recovery in global agriculture conditions is the primary driver for the upgrade. Nufarm is tipped to grow its earnings before interest, tax, depreciation and amortisation by a whopping 38% this financial year.

“After a difficult FY20 agriculture season, it appears global planting conditions in Nufarm’s key regions have turned favourable,” said UBS.

“The improved agriculture conditions have also coincided with a significant increase in key soft commodity prices which together have driven a rapid improvement in farmer sentiment.”

More reading

• Why the Amcor (ASX:AMC) share price is having a rough start to 2021
• Why the IGO (ASX:IGO) share price is tanking today
• ASX 200 down 2.3%: Bank shares tumble, InvoCare jumps, IOOF disappoints
• Why the Eagers Automotive (ASX:APE) share price is on watch today
• 5 things to watch on the ASX 200 on Thursday

Motley Fool contributor Brendon Lau owns shares of Nufarm Limited. 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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Over the last week, the world has watched on in astonishment as the Reddit crew on WallStreetBets coordinate an almighty short squeeze on GameStop Corp (NYSE: GME).

The share price for GameStop has skyrocketed 790% in the last week alone. Now ASX-listed GME Resources Ltd (ASX: GME) has surged 28% on no news – Did someone get the wrong GME?

GameStop share price, mob mentality

The massive rally in GameStop comes after the future of the bricks and mortar gaming retailer looked shaky. Short positions (a way of profiting on price decrease) grew, as fund managers looked to capitalise on a collapse – then the antics of WallStreetBets stepped in.

One user devised that if investors bought and held, shorters would be forced to keep bidding higher to exit their increasingly losing short positions. The result, insane share price increases in an otherwise unextraordinary company.

This dramatic rise was only exacerbated when Tesla Inc (NASDAQ: TSLA) founder, Elon Musk, tweeted out about GameStop.

Gamestonk!! https://t.co/RZtkDzAewJ

— Elon Musk (@elonmusk) January 26, 2021

https://platform.twitter.com/widgets.js

The world’s richest person was then joined by venture capital titan, Chamath Palihapitiya. Chamath also tweeted that he was jumping in on the rise:

Lots of $GME talk soooooo….

We bought Feb $115 calls on $GME this morning.

Let’s gooooooo!!!!!!!!

GME on the ASX

So now we are potentially experiencing this hype on the ASX, with GME Resources. A case of mistaken identity hasn’t been uncommon recently. A US-listed company recently pumped more than 6000% after Elon Musk tweeted about the Signal messaging app, with no ties between the two.

GME Resources has no news out today, so its possible that this price increase is indeed another mishap.

Obviously, there aren’t any similarities between the 2 GMEs. One is a games retailer, the other is a minerals exploration company in Western Australia.

GME share price performance

With today’s price jump, the GME Resources share price is up 70% in the last 12 months. The company’s market capitalisation now resides around $40 million. If you were interested, GME Resource’s new long lost cousin, GameStop, has a market cap of $25 billion.

More reading

• Tesla earnings: 5 must-see metrics highlight strong execution
• Here’s why GameStop stock skyrocketed more than 100% on Wednesday — and why it could be on the verge of collapse
• Here are the US shares ASX investors are buying
• Chamath Palihapitiya jumps on the GameStop bandwagon
• Will the blue sweep boost Tesla? Don’t count on it

Mitchell Lawler owns shares of Tesla. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and recommends Tesla. 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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