The Swvl Holdings Corp (NASDAQ: SWVL) stock price rallied 22.7% despite the lack of news from the mass mobility platform that has seen a spectacular erosion of shareholder value this year.
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SWVL went public via a SPAC merger with Queen's Gambit Growth Capital, valued at $1.5 billion. The company’s shares were trading at $9.95 each during the IPO but have since fallen over 98.89% to trade at their current price of $0.11.
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Unfortunately, the situation has recently gone from bad to worse for the company leading to a mass layoff aimed at stemming losses, which threaten its existence. The firm has fired employees in its founding country of Egypt and other markets such as Pakistan and its HQ in Dubai.
However, SWVL is still in trouble after receiving a notice of non-compliance from the Nasdaq since its stock has been trading below the minimum listing requirement of $1 since late September.
The company has no choice but to conduct a reverse stock split to boost its share price and make it attractive to institutional investors. It is just a matter of time before the company announces the reverse split.
Despite its troubles, SWVL shares have received favourable ratings from investment analysts at multiple banks. For example, C. K. Poe Fratt, an analyst at Alliance Global Partners, has a buy rating on SWVL stock with a $5 price target.
Fratt noted that SWVL’s operations in five markets had turned Adjusted EBITDA positive or breakeven in August. The five countries also accounted for 58% of the company’s revenue in the first half of 2022.
Retail investor interest in SWVL stock has recently skyrocketed, leading to the 10% rally witnessed yesterday and today’s premarket rally. Over 4.8 million SWVL shares had changed hands at the time of publishing.
So, should you buy SWVL shares? The short answer depends on your thoughts about the firm’s prospects. You could buy it if you think it will weather the current storm and emerge stronger.
*This is not investment advice.
SWVL stock price.
The SWVL stock price rallied 22.73% premarket to trade at $0.14, rising from Thursday’s closing price of $0.11.
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