Yesterday, Iron & Steel for Mines & Quarries [ISMQ] debuted on the EGX, ending the day with a buy rush at EGP1.82 (+420%). The stock hit an intraday high of EGP2.25/share after opening at EGP1.50. Compared to the open price, ISMQ ended the day 21% higher. Investors cheered the newcomer on hopes of a successful turnaround story. However, the bullish run of ISMQ cannot be decoupled from other behavioral factors which drove its performance. Just like the case with former spin-offs, the spun-off company always seem underappreciated; thus investors rush on buying as was the case with Arab Co. for Asset Management & Development [ACAMD] on its debut day. As to how long ISMQ’s upward run would continue depends on when behavioral factors end and when fundamentals start to take over.
Discussion about this post
No posts