Today, investors in Wilhelmina International (NASDAQ:WHLM) and WHLM stock are seeing very impressive gains. Indeed, shares of WHLM stock have skyrocketed more than 35% to $6.75 at the time of writing.
Today’s move comes amid a relatively flat couple months of trading. This is a stock that has remained relatively stable around $5 per share of late. However, this is also a stock that spiked to more than $14 in April as a venture capital firm bought a significant stake in WHLM stock.
How significant?
Well, it was reported that Retail Ecommerce Ventures bought a stake of more than 18% in WHLM stock. This significant move prompted other retail investors to consider this stock. Indeed, this makes sense, considering two of the key players in Retail Ecommerce Ventures are Tai Lopez and Alex Mehr, two thought leaders among millennial retail traders.
Let’s dive into what could be behind today’s move in Wilhelmina.
WHLM Stock Surges on Little News
Today’s outsized move in WHLM stock is based on little news. Indeed, this is a micro cap company with a market capitalization around $35 million, after today’s rise.
Wilhelmina’s current solvency and liquidity situation has been brought to light as of late, casting some concern that this modeling and talent agency could be under bankruptcy pressure. Add to this a relatively high short volume ratio and retail investors have some real impetus to buy in cheap on what could turn out to be a short-squeeze play.
Additionally, Wilhelmina has been trending today on various popular social media sites. Volume for this stock is currently 66 times the average daily volume for this stock, and it’s still early in the trading day. Therefore, it’s safe to say retail investors have their fangs in this one.
Where WHLM stock goes from here remains to be seen. However, this is a company with some serious fundamental concerns. Investors putting any significant amount of money in WHLM stock should be aware of the risks. As always, risk management is key with these highly speculative plays.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
