Ferroglobe PLC (NASDAQ: GSM) is having an incredibly strong start to the trading session this morning. However, if you go digging for news that would lead to the climb, you’re not going to find any press releases or SEC filings. Nonetheless, there is a good reason for the gains. Today, we’ll talk about:
- Why GSM is headed up;
- what we’re seeing from the stock; and
- what we’ll be watching for ahead.
Here’s Why GSM Is Climbing
As mentioned above, Ferroglobe is having an incredibly strong day in the market today, but the company has released no news. So, what’s the deal? Well, it all has to do with an analyst note.
In a note, B. Riley FBR reduced its price target on GSM by $10, sending it down from $14 to just $4 per share. With the reduced price target, one may think that the market would react negatively. However, there’s more to it.
In the note, B. Riley FBR pointed to the disappointing third-quarter results as the reason for the price target decrease. However, the firm maintained its buy rating on GSM. To that end, the firm noted that the $4 price target implied a multiple of eight times reduced expectations for 2019. The target also suggested a 100% upside.
So, while the price target was decreased, there were positive points to take away from the note. Sure, the third-quarter results were not great, but B. Riley FBR still sees an opportunity for strong growth in the value of the stock.
What We’re Seeing From The Stock
One of the first lessons that we learn when we start to dig into the market is that the news leads to moves. While Ferroglobe didn’t release any news of their own, the news of the analyst upgrade is definitely leading to a move today. After all, the report proved to be positive overall, leading to excitement among investors. As is normally the case, our partners at Trade Ideas were the first to alert us to the gains. Currently (11:22), GSM is trading at $2.32 per share after a gain of $0.52 per share or 28.89% Thus far today.
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What We’ll Be Watching For Ahead
Moving forward, the iWatch Markets team will continue to keep a close eye on GSM. In particular, we’re interested in following the story surrounding the company’s work to effect growth following the poor recent earnings report. Nonetheless, we’ll continue to follow the story closely and bring the news to you as it breaks!
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