GNS Stock Heats Up Ahead of Genius Group Spinoff

  • Genius Group (GNS) has been on a hot streak since it announced plans for a spinoff.
  • Shares are surging as the Aug. 31 date of record approaches.
  • But even as GNS stock rises past $1, the company still poses plenty of red flags for investors.
GNS stock - GNS Stock Heats Up Ahead of Genius Group Spinoff

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This month will end with an important day for Genius Group (NYSEMKT:GNS). The education technology company is preparing to spin off Entrepreneur Resorts. This subsidiary trades on the Australian stock exchange and describes itself as “a way to co-work, co-live and co-learn in paradise locations around the world, connecting with local entrepreneur communities.”

As InvestorPlace‘s William White reported, news of this development sent GNS stock shooting up, and it hasn’t stopped since. GNS stock has surged by more than 150% in just the past five days, and it doesn’t seem to be slowing down. Though still well within the penny stock threshold of $5 per share, it has managed to stay well above the $1 mark. With two weeks to go until the spinoff date of Aug. 31, this microcap company could rise even more.

Does this mean that investors should be loading up on Genius Group before the spinoff takes effect? These gains are hard to ignore, but they don’t necessarily mean that potential buyers should jump in with both feet.

What’s Happening With GNS Stock

This week is off to an excellent start for Genius Group as momentum for the spinoff continues. As of this writing, GNS stock is up more than 30% for the day, despite losing some momentum from earlier. Data from Ape Wisdom makes clear that while retail investor interest in the stock is high, it isn’t coming from r/WallStreetBets. GNS has not received any mentions on the popular Reddit forum in the past 24 hours.

Let’s take a closer look at the upcoming spinoff. As Genius Group noted in a recent announcement, Aug. 31 is the date of record for the important event. It has marked the final day of the month for a full share count for distribution purposes. Per the company’s statement:

“On August 1, 2023, the Singapore High Court approved the spinoff of ERL from Genius Group, with a capital reduction and share distribution to all Genius Group shareholders at the record date of US$38,380,873 in the form of restricted ordinary shares in ERL, pursuant to a private placement transaction exempt from registration under the provisions of the Securities Act of 1933, as amended.”

Given how much GNS stock has risen since then, it’s clear that the market is reacting well to news of the Entrepreneur Resorts spinoff. But even with this recent surge, it’s difficult to ignore the fact that less than a year ago, it was trading at more than $7 per share. It began this month at less than $1. As InvestorPlace contributor Ian Bezek notes, that may be due to the company’s struggling finances and inability to demonstrate any actual growth. He sees this as meme stock to avoid before its current momentum runs out and shares fall even further, a likely scenario for after the spinoff has been completed.

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On the date of publication, Samuel O’Brient did not hold (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 Publishing Guidelines.

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