Stock for BT Brands, Inc. (NASDAQ: BTBD) had undergone a hard fall this weekend, in the after-hours, declining by 28.9%. This tumble came abruptly in the last hour of trade on Friday, plummeting BTBD to an all-time low. Although only four months being publicly traded, the swing took market participants by storm, with barely any external indicators of a trigger. As the weekend pushes on, market participants are closely eyeing the fast-food stock, dropping 65.93% since its initial public offering. This translates to a fall from $4.55 per share to the current $1.55 per share, raising significant red flags.
What is Causing the BTBD Beat Down?
Given the surprising turn of events, market participants have been searching for a possible driver causing this swing. However, no indicators show up, causing this beat down, which points to a different reality altogether. BTBD may possibly be caught up in a negative social media frenzy, exacerbated by other market behavioral drivers. The number of shorts covering BTBD stock amounted to a surprising zero, which further emphasizes the suddenness of this fall. Further scanning of the social media spheres does not point to negative press or the spread of BTBD-related rumors. This, therefore, disqualifies the market classic ‘poop and scoop’ strategy, which could have seemingly been underway. The lack of an anchor to this fall presumably suggests BTBD may see a subsequent drive-up. This comes on account of BTBD trading as potentially undervalued.
BTBD Earnings Release
The most recent solid market information pertaining to BT Brands that made the cycles was the company’s earnings report. The various dimensions of earning each highlight positive performance, and potential growth potential. These specific dimensions are as follows:
- An increase of total revenue by 3.6% to $8.5 million, indicating a steady growth pattern.
- An increase of operating income by a whopping 83.3% to $980,712. This potentially highlights more efficient operational procedures.
- An improvement in liquidity position, rising gradually from $10.7 million to $12.4 million. This diminishes the risk of bankruptcy, given the mid-size of operations.
Conclusion
BTBD, undergoing a massive weekend plummet has little substantial anchorage to justify its fall. Its financial fundamentals appear stable, and social media chatter regarding the stock remains quiet. The stock, therefore, is likely to see a bounce-back in the short-term, on account of a potential undervaluation.
