Acacia Communications, Inc. (NASDAQ: ACIA) is having an overwhelmingly strong start to the trading session this morning. However, if you do your digging, you’ll see that the company hasn’t released any news recently that would suggest such gains were on their way. Nonetheless, there is a good reason for the gains. Ultimately, they’re being caused by a tweet from President Trump. Today, we’ll talk about:
- The tweet that sent ACIA running;
- what we’re seeing from the stock;
- and what we’ll be watching for ahead.
ACIA Gains Big On Trump Tweet
As mentioned above, Acacia Communications is having an overwhelmingly strong start to the trading session this morning after news surrounding a tweet made by President Trump hit investors. In the trade war between the United States and China, there have been several companies that have felt some pain. ACIA is one of those companies.
You see, ZTE, a Chinese company has been feeling pain as a result of the trade war. Essentially, ZTE is a very important customer to ACIA. In fact, the customer accounted for approximately 30% of Acacia revenue last year. So, when one goes down, so too does its suppliers. However, President Trump tweeted over the weekend that he was working with China in an attempt to find ZTE a way to get back into business quickly. Of course, if this happens, this important stream of revenue opens back up for ACIA. So, investors are excited that the revenue stream may become active yet again.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to dabble in the market is that the news causes moves. In this particular case, the news proved to be overwhelmingly positive. With a strong stream of revenue likely opening back up to Acacia, it only makes sense that investors are excited, sending the stock screaming for the top. At the moment (8:53), ACIA is trading at $37.23 per share after a gain of $5.73 per share or 18.19% thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the CNA Finance team will continue to keep a close eye on ACIA. In particular, we’re interested in following the story to see if the ZTE revenue stream opens back up for the company. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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