Cemtrex, Inc. (CETX) stock prices continue their upward trend, having ended the July 9th, 2021 trading day at USD$1.49, a 13.64% increase. Subsequent premarket fluctuations have seen the stock rise another 15.44%, bringing it up to USD$1.72.
Revenue Reports
CETX reported USD$9.3 million in revenue for the quarter ended March 31st 2021, representing a year-over-year decrease of 24% from the USD$12.1 million reported for the same time period of 2020. The yearly difference is largely attributable to the devastating effects resulting from the onset of the coronavirus pandemic causing shutdowns and the limiting of business operations. The Advanced Technologies segment revenues for the quarter were down 11% to USD$5.5 million, while the Industrial Services segment revenues were down 36% to USD$3.8 million.
Net Income Improvements
Net income for the quarter was reported at USD$2.5 million for the quarter, up significantly from the net loss of USD$1.6 million reported in the prior year quarter. This year-over-year difference is largely attributable to various income items exclusive to the 2021 quarter, including a one-time settlement agreement, as well as unrealized gains on marketable securities.
Traded Volume Increase
The company reported cash and cash equivalents in the amount of USD$15.6 million as of March 31st 2021, indicating a comfortable liquidity position. Nevertheless, the steep climb of volume of shares traded from the low thousands to upwards of one million over a course of days is not adequately contextualized by the company’s recent financials. Rather, the absence of any other recent news or changes in fundamentals makes the stocks recent activity highly contentious.
Meme Stock Phenomenon
In the absence of recent developments, it seems likely that the stock finds itself the target of the meme stock phenomenon that has been captivating the markets again as of late. Driven by retail investors, the movement has seen underdog companies being targeted for a short-term pump and dump. Companies that indicate a high short interest find their stock prices being inflated artificially with little to no reason in the coordinated short squeeze. Rife with inherent risk and volatility, the movement is not consistent or reliable. Moreover, in most cases it seems a very large correction on a very short timeframe.
Future Outlook for CETX
Nevertheless, armed with the fortuitous surge in equity value provides the company the exposure to capitalize on the addition opportunities it finds at its disposal. Current and potential investors are hopeful that management will be able to leverage the resources at their disposal to facilitate more organic growth over the long term.
