Takung Art Co., Ltd. (TKAT), a company operating, through its subsidiaries, an electronic online platform for artists and art dealers, is seeing a decline in share price in the premarket session. TKAT stock has decreased by 6.45% and currently sits at $10.30. That bearishness has come after TKAT stock surged a massive 56.39% on Wednesday.
Playing NFT boom
TKAT stock was trading higher due to above average volume on Wednesday. The stock was seen as a way to play the non-fungible token (NFT) boom. The NFT sector saw an increase in volume following the Visa Inc. CryptoPunk purchase and social media mentions. TKAT crossed the 20 million in trading volume. Average volume for the stock stood at about 3.5 million. TKAT stock was among the most searched stock at that time.
TKAT Q2 financial results
On the 13th of August, TKAT announced the quarterly results for the second quarter of the fiscal year 2021, which ended on 30th June. According to the details, the company had total assets of $34.66 million during the quarter. The total liabilities were $29.63 million during the quarter. The total revenue generated during the quarter stood at $1.14 million, as compared to the total revenue of $1.67 million during the equivalent period of 2020. The gross profit was $0.69 million, as compared to the gross profit of $0.92 million during the equivalent period of 2020. The total operating expenses during the quarter stood at $8.08 million, as compared to the operating expenses of $0.99 million during the equivalent period of 2020 (such a massive decline happened due to the fact that the company’s performance during the course of the pandemic was not up to the mark).
Closing of private placement
On the 13th of July, TKAT stock value declined some 15.92% after the company announced the closing of a $5 million private placement. According to the details, the 71,429 shares of Common Stock had a purchase price of $8.75 per share. Gross proceeds were about $5 million. Maxim Group LLC was the sole placement agent for the transaction. The company said that it hopes to utilize the gross proceeds for working capital and general corporate purpose. The company announced that private placement on the 8th of July.
Volatility due to NFT related speculations
On the 22nd of April, TKAT stock surged on the speculation that the company could jump into NFT space. The shares of the company soared some 23%. NFT are the digital files related to arts, videos, and audios, which are stored on to the blockchain. Lots of NFT’s had been sold for millions of dollars, as a result of which, numerous companies have opted to offer NFT, including TKAT. Due to similar speculations, TKAT stock soared massively on the 26th of May as well. Due to that sort of speculations, companies like TKAT, which investors hoped would jump in the NFT space, experienced wild swings in share prices and are still experiencing the same.
What future holds in store?
From indicators, it seems that TKAT stock is on a rising trend during the near future, primarily due to inclusion in NFT. The EPS of the company could increase by 85.10% for this year. Recent performance of a stock is also depicting happy times for it in near future. So, potential investors should keenly keep watching TKAT stock.
