Exela Technologies (NASDAQ:XELA) stock remains an unlikely meme favorite.

The company was formed a few years ago out of a special purpose acquisition company (SPAC) which merged with two firms in the document processing industry. The combination of the two was named Exela Technologies and started trading as XELA stock.

Since that listing, accounting for the reverse stock split, shares have lost 90% of their value.

Investors have shied away from Exela because much of its business used traditional processing methods and appeared at risk of disruption by cloud and software-as-a-service (SaaS) alternatives. Exela has pushed heavily into a more digital-first strategy as well, but concerns remain around whether they can pivot their business model in time.

That’s the thousand-foot view on Exela Technologies. However, shares continue to trade hands at a frenetic clip. So let’s zoom in on the past month, and see what’s new for the company.

A Closer Look at XELA Stock

Since I last covered Exela, the most interesting new development is that the company now has options trading.

On July 16, XELA stock officially saw the launch of options trading. Many times, low-priced stocks do not have options available due to a lack of popular demand. However, given Exela’s massive volatility in recent months, the firm became an obvious choice to have an active options market.

Shares surged from $3.30 to as high as $4.05 on July 16 on the day the options went live. This happened on incredible trading volume surpassing 150 million shares in a single day.

It seems that traders were hoping that the new XELA call options could set off a major gamma squeeze.

Alas, this plan didn’t amount to much. By the end of the day July 16, XELA stock had fallen back to $3.27, and it slipped under $3.00 the next day. It’s actually not that simple to set off a gamma squeeze by buying call options; a lot of factors have to go right for the strategy to end up paying off.

Modest Advances Elsewhere

Aside from getting options listed, Exela offered up two other pieces of news in recent weeks. One was record sign-ups for the company’s digital mailroom (DRM) and its DrySign products this quarter. Both posted triple-digit user growth rates compared to the prior period.

On the surface, that’s great news. XELA stock jumped on heavy volume the day this press release came out.

Shares quickly retreated, however. That might be because the press release doesn’t necessarily offer enough context to understand the development.

The company is rolling out these services in more international markets, so it may not be that surprising that is growing quickly given the new markets. Additionally, without discussing revenues or profit margins, it’s hard to get a sense of how much this will matter to Exela’s earnings.

The other was that Exela expanded its offerings of AI-enabled automation in the business process automation (BPA) space. A more intelligent approach to data processing allows companies to replace a lot of manual data entry with computerized systems.

This is good for both lowering costs and improving speed in document handling. Exela states that its advances in this area “further cements” its status as an industry leader.

As with the DRM news, this is definitely a good thing in isolation. However, the company doesn’t elaborate on how much this might affect the company’s revenue growth or profits going forward.

XELA Stock Verdict

Frankly, it’s pretty incredible that traders are buying and selling this much XELA stock every day. It’s pretty clear that folks are attracted to shares for reasons other than the fundamentals.

Simply put, we just looked at three of the most recent press releases Exela has put out, and none of them really justify anything close to this level of trading frenzy.

As such, the stock’s current volatility isn’t really based around the company’s long-term outlook. Thus, if you’re trading, be aware that the price is moving around mostly based on sentiment and technical factors rather than anything to do with Exela’s long-term prospects.

As far as Exela goes as an investment, I highlighted its broader strengths and weaknesses recently. The company has a large established business that could be a money-maker if it can firm up its profit margins.

On the flip side of that, however, Exela is shouldering a ton of debt. If the company isn’t careful, those liabilities could trip Exela up before it completes its turnaround. In the short term, however, the trading action will likely be driven by other factors rather than fundamental analysis.

On the date of publication, Ian Bezek 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.

Ian Bezek has written more than 1,000 articles for InvestorPlace.com and Seeking Alpha. He also worked as a Junior Analyst for Kerrisdale Capital, a $300 million New York City-based hedge fund. You can reach him on Twitter at @irbezek.

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