Alfi, Inc. (ALF) stock prices were up by a massive 50.11% shortly after market trading commenced on June 25th, 2021, bringing the price per share up to USD$19.29 early on in the trading day.
Share Repurchase Program
June 23rd, 2021 saw the SaaS platform company announce that its Board of Directors had given the green light for the company to go ahead with a share repurchase program, which would see the repurchasing of up to USD$2 million of its common stock. The company cited the exercising of outstanding warrants, associated with its recent IPO, having benefited its balance sheet as a major factor in the decision to implement the repurchasing program.
Recent Skyrocketing
While potentially favorable for investors, these developments do not, however, explain the recent activity seen by ALF’s stock prices. June 22nd, 2021 saw the shares close while up 108.8%. Rather, ALF seems to be the latest target for the meme stock phenomenon that has dominated the stock markets in recent weeks. The company’s market cap has skyrocketed to USD$201 million, up from the USD$15.5 million valuation from earlier in May of 2021. June 22nd, 2021 saw the stock touch a high of USD$16.45 million, after having been traded at a monumental volume of 211 million shares. On that day, ALF was the third most actively traded stock on the U.S exchanges.
Agreement with All-Niter
June 15th, 2021 had seen another such massive surge in share price, of 104.4%, but this was in the wake of the announcement of ALF’s agreement with All-Niter. As per the agreement, the partner would be responsible for the shipment and installment of the first 10,000 digital Alfi tablets to be distributed on a global scale to drivers for Uber and Lyft.
Meme Stock Phenomenon
Driven by users of the popular social media platform, Reddit, investors coordinate to invest heavily in companies that exhibit a high short interest. As the price is inflated, the Reddit-driven investors cash out on their investments, while hedge funds and other corporate investors scramble to mitigate their losses as a result of the short squeezes. With a trend of picking underdog companies, sometimes on the brink of collapse, these readers confound more seasoned investors with the absence of a valid reason to invest in the companies they do. Lacking major recent developments or changes in fundamentals to justify the skyrocketing prices, this phenomenon has made for a very volatile market as of late.
Future Outlook for ALF
Armed with the influx of capital from the skyrocketing of equity value, ALF is poised to capitalize on the opportunities afforded to it. Current and potential investors are hopeful that management will continue to leverage the resources at their disposal to facilitate significant and sustained increases in shareholder value.
