Luokung Technology Corp. (LKCO) stock prices stayed stable over the course of June 11th, 2021, with no change in the opening and closing price. Pre-market fluctuations, however, saw the stock skyrocket by 17.51%, bringing it up to USD$2.08.
Meme Stocks on the Rise
The meme stock phenomenon continues to dominate the stock exchange, with a slew of stocks being targeted for a coordinated pump by the Reddit-driven retail investors. Underdogs with a high short interests find themselves fortuitously bolstered as the community of investors continues to target companies without a logical basis for their support. In the absence of recent news or any fundamental developments, companies sometimes on the brisk of collapse find themselves renewed by the sweeping meme stock craze.
CCMC Designation
LKCO’s recent skyrocketing of equity value comes after turbulent several weeks, following the company’s announcement of the halting of the trading of its common shares on stock exchanges. This restriction was imposed on the company after it had been given a Communist Chinese Military Company (CCMC) designation. Because of this designation, LKCO finds itself at the mercy of Executive Order 13959.
Resisting CCMC Designation
A joint complaint was filed by LKCO and two U.S. shareholders with the United States District Court for the District of Columbia, who are seeking to reverse this designation. As per the complaint, the U.S. DoD’s designation of LKCO as a CCMC and the resulting restrictions authorized by Executive Order 13959 by former President Trump are both in violation of the law.
Request for Preliminary Injunction
Because of the resolution of the lawsuit being too far in the future, LKCO has filed a motion for a preliminary injunction that will defer the CCMC designation and associated trading restrictions until the case has been settled. While the company is confident of an outcome in their favor, they argue that the failure to issue an injunction could end up having unmerited and disastrous effects on the company’s balance of equities, as well as their public interests.
Preliminary Injunction Granted
May 6th, 2021 saw the company announce that their previously announced motion for a preliminary injunction was granted. Following the ruling, the Department of Defense and other government defendants are prohibited from implementing or enforcing the designation of LKCO as a CCMC, or any consequential restrictions pursuant to Executive Order 13959.
Future Outlook for LKCO
Armed with the fortuitous surge in the value of their equity, LKCO is poised to capitalize on the opportunities presented to it. The company is keen to continue its trajectory of success and usher in more organic growth over the long term. Current and potential investors are hopeful that the management will leverage the resources at their disposal to facilitate significant and sustained increases in shareholder value.
