China TechFaith Wireless Communication Technology Ltd (NASDAQ: CNTF) is flying early on in the market this morning, and for good reason. The company announced the sale of an asset that excited investors who are pushing the stock for the top. Today, we’ll talk about:
- The asset sale;
- what we’re seeing from CNTF as a result; and
- what we’ll be watching for ahead.
CNTF Rockets On Asset Sale
As mentioned above, China TechFaith is having an incredibly strong start to the trading session this morning as news breaks surrounding an asset sale. In a press release issued early this morning, the company announced that Techfaith Wireless Technology Group Limited, its wholly owned subsidiary has entered into a share purchase agreement with an unrelated third party.
In the release, CNTF said that under the terms of the agreement, TechFaith Wireless will sell 100% of its ownership in Charm Fiath Limited, its wholly owned subsidiary. The deal comes with a total price of RMB710 million, which is subject to certain price adjustment mechanisms as well as a detailed installment payment schedule.
What We’re Seeing From The Stock
As investors, one of the first lessons that we learn is that the news moves the market. In the case of China TechFaith, the news proved to be overwhelmingly positive. After all, the asset sale will drive significant funding into the company, which will set it on a strong foundation for future growth. So, it’s no surprise to see that the stock is screaming for the top in the market this morning. At the moment (9:14), CNTF is trading at $3.88 per share after a gain of $2.05 per share or 112.02% 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 CNTF. In particular, we’re interested in following the story surrounding the company’s plans to use the funding that will come as a result of this news. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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