ATA Inc. (NASDAQ: ATAI) is having an overwhelmingly strong start to the trading session this morning, following up on the strong gains that we saw on the stock yesterday. The gains come following the announcement of plans to move into the international art education space.
Of course, the news excited investors who continue to push the sotck for the top. Today, we’ll talk about:
- The company’s plans to move into international art education;
- what we’re seeing from ATAI stock as a result; and
- what we’ll be watching for ahead.
ATAI Announces Framework Agreements Surrounding International Moves
As mentioned above, ATA is having a great day in the market today, following up on yesterday’s gains. The gains come after the company announced that it entered into non-binding framework agreements with regard to international efforts.
ATAI said that the agreements were signed with Beijing Huanqiuylmeng Education Consultation Corp. and key shareholders. Under the terms of the agreements, the company intends on acquiring ACG, a leading provider of educational services for Chinese studients who would like to study abroad.
In a statement, Mr. Kevin Ma, Chairman and CEO at ATAI, had the following to offer:
Over the past few years, we have identified a significant opportunity to grow in certain strategic markets for domestic and international educational markets. The art education market is of particular interest due to rapidly growing interest in China and need for international education experience to enhance the learning capabilities of students.
The market has a low concentration, and we believe that ACG has a strong presence and is taking advantage of this opportunity to grow. ATA’s collaboration with ACG would provide considerable synergies in our core competencies as well as help to greatly enhance its market position. In addition, we will also continue to explore and validate other potential areas of expansion where appropriate.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to work in the market is that the news leads to moves. When it comes to ATA Inc., the news proved to be overwhelmingly positive.
Should this transaction go through, the acquisition will likely propel the company’s revenues. Moreover, it will bring a new line of services to the company, increasing its strength within the industry.
So, it’s not surprising to see that excited investors are pushing the stock on a run for the top. As is just about always the case, our partners at Trade Ideas were the first to alert us to the gains. Currently (9:32), ATAI is trading at $2.50 per share after a gain of $0.38 per share or 17.92% 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 ATAI. In particular, we’re interested in following the company’s plans to expand to an international service provider. Nonetheless, we’ll keep an eye on the news and bring it to you as it breaks!
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