Darling retail investor stock NanoRepro lures short sellers after 4000% gain
(Reuters) – Fertility testing company has become COVID-19 specialist NanoRepro NN6G.DE, which has recently been the darling of German retail investors, has seen a sudden rise in short-selling activity after a dramatic surge in stock prices.
Shares of the Marburg-based company have climbed around 4,000% at its peak this month since early March last year when it first added a coronavirus test to its portfolio, triggering a boom in its activity.
But signs of equity borrowing activity in the German microcap company emerged for the first time in more than 15 months last week, data from FIS Astec Analytics showed, indicating that some investors were trying to sell the ‘uncovered action.
Before the end of February, there was no sign of borrowing activity, in part due to low float, as traders piled up in stocks after demand for COVID-19 testing led to a tenfold increase in its sales in 2020 and an explosion in its order book.
According to the latest data from FIS Astec, the cost of borrowing shares of the little-known company peaked at 17% on Wednesday, ten times the industry average, as lending volumes increased.
On the same day, NanoRepro peaked at over 22 euros, giving the company a market capitalization of over 240 million euros ($ 285 million) from just 5 million a year earlier.
Since then, the stock has lost ground and at 2:28 p.m. GMT on Tuesday it was set for its worst day in five months, down 18%.
“It falls incredibly fast. And that doesn’t sound like a “dive”. Someone who sells rarely comes alone. Glad to be out, ”Reddit user Porsche981Fan told German forum MauerStrassenWetten where NanoRepro became a star.
Despite the new fall, NanoRepro is still up nearly 2,500% from last year, a development that overshadows the rallies seen in high-profile assets like Bitcoin or Tesla.
Meanwhile, the German government’s plan to pay for all asymptomatic citizens to undergo a rapid COVID-19 test at least once a week is yet another boon for the company NanoRepro has recently ventured into.
For a graph on NanoRepro, click onhere
($ 1 = 0.8413 euros)
Reporting by Danilo Masoni; Editing by Bernadette Baum