TOP SHIPS Inc (NASDAQ: TOPS) is having an overwhelmingly strong day in the market this morning. However, if you do a bit of digging, you’ll see that the company has not released any news. So, what’s the deal? Well, the gains are the result of speculation. Today, we’ll talk about:
- Why TOPS is headed up in the market;
- what we’re seeing from the stock; and
- what we’ll be watching for ahead.
Why TOPS Is Headed Up
As mentioned above, TOP SHIPS is having an incredibly strong day in the market today. While the company hasn’t released any news of their own, the reason that the stock is climbing is simple. Recently, Diana Containerships (DCIX) reported its financial results for the first quarter. The company did overwhelmingly well, more than doubling revenue year over year and seeing strong reductions in losses on a year-over-year basis.
What’s important here is that DCIX and TOPS operate in many of the same ways. In fact, the companies are so similar that, if they were to merge, there wouldn’t need to be much work done to get either company up to speed with the other. So, there is speculation brewing that, with DCIX having such a strong earnings report, TOPS will release the same.
However, it’s important to remember that speculative investments are high risk. While Diana Containerships and TOP SHIPS are very similar companies, there’s a good chance that TOPS didn’t make the same changes as DCIX and that their earnings report may not match what we saw from their competitor. So, if you’re going to trade on this news, be careful!
What We’re Seeing From The Stock
As investors, one of the first lessons that we learn is that the news moves the market. While the news released today has little to do with TOP SHIPS, speculation is brewing, and we’re definitely seeing movement. Of course, our partners at Trade Ideas were the first to alert us to the gains. At the moment (11:20), TOPS is trading at $1.75 per share after a gain of $0.13 per share (8.02%) 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 TOPS. In particular, we’re interested in following the company to see if its earnings match that released by DCIX. Of course, if it does, the stock could see some massive gains. However, if that’s not the case, we could see some big declines ahead! Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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