NII Holdings, Inc. (NASDAQ:NIHD)
NII Holdings, Inc. (NASDAQ:NIHD) shares more than doubled just one hour into Friday’s trading. NIHD shares closed Thursday at $0.53. The Friday pre-market action consisted of a single share traded at $0.53. However, when Friday’s regular trading session opened at 9:30 AM EST, massive “buy” orders hit and the price of NIHD went from $0.53 to $1.20 in less than one hour. NII Holdings, Inc. (NASDAQ:NIHD) shares have a 30-day, daily volume average under 1 million shares. By 11 AM EST, over 12 million shares of NIHD had already changed hands.
The exact catalyst for the dramatic price and volume increase is unknown at this point in time. A review of financial media, the website of NII Holdings, Inc. (NASDAQ:NIHD), as well as trader’s forums reveal no news that would justify the doubling of the share’s price on volumes of almost 50 times normal. Curiously, NIHD shares are still trading well below their listed cash/share value of $2.13.
One possible contributor to today’s activity may be the Brazilian political scene. NII Holdings, Inc. (NASDAQ:NIHD) is a wireless reseller of Nextel services in Brazil. The Brazilian stock market went under tremendous selling pressure as details emerged of prosecutions against public officials for corruption. However, the slide of NII Holdings, Inc. (NASDAQ:NIHD) shares began long before that news was released. In January, NIHD shares were trading above $3.50 but just last week you could have picked them up for around $0.50. NIHD has a 52-week low of $0.36 and a 52-week high of $4.07. The short action (5.5% of the float) is not that significant, so short covering could not have played that large a role in today’s price spike.
Fundamentally, NII Holdings, Inc. (NASDAQ:NIHD) has been an under-performer which was what likely led to the management shake-up that was announced in late April. In 2012, NII Holdings, Inc. (NASDAQ:NIHD) reported sales of $5.69 billion but that number steadily decreased each year and by 2016 the company’s sales did not even go over $1 billion. For Q1 2017, the release of the earnings did not help investor confidence as shares dropped 5.59%.
In the meantime, if anyone has a clue as to why NIHD shares exploded, please drop us a line…
I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. All information, or data, is provided with no guarantees of accuracy.
About the author: Marc has a degree in economics and a MSc. in Finance. Over his 20-year career, Marc has worked for global investment firms in Europe and the United States as an analyst, fund manager, and consultant.