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Investors stopped and stared at the stocks of Beijing-based educational firm ATA Creativity Global (NASDAQ:AACG, AACG:US) as they surged by over 951 per cent on Thursday, February 4. The stock price jump came with a notable rise in its trading volume as well.
But as markets opened on Friday, AACG stocks reflected a sharp dip of nearly 39 per cent at the time of writing this (10AM EST).
So, what exactly is going on with AACG stocks? Let’s find out.
ATA Creativity Global (NASDAQ:AACG, AACG:US)
The stock price surge of ATA Creativity Global, an international educational services firm, was not preceded by any corporate or business-related news from the company. But what did likely pump up the stocks was mentions of the Chinese company on Reddit-based trading forums like WallStreetBets, Stocktwits, etc.
Soon after, AACG stocks also became a prominent topic of discussion on Twitter as its price kept galloping for most of the day.
Reddit-based retail traders became widely known over the last few weeks for their role behind the insane rally of stocks like GameStop, (NYSE:GME, GME:US), BlackBerry (TSX:BB), etc. Earlier this week, stocks of cannabis producer Sundial Growers Inc (NASDAQ: SNDL, SNDL:US) also took off following a boost from day traders.
©Kalkine Group 2021
What To Know About ATA Creativity Global?
With a market cap of US$ 448 million, ATA Creativity Global falls in the group of small-cap stocks. Reports says that its largest shareholder is a firm named Joingear Limited, owning a stake of about 30 per cent, and that is it not held by any major hedge funds.
Originally founded in 1999, the company is said to have been formerly known as American Testing Authority. It eventually reestablished itself as ATA Creativity Global in 2006. The company now functions out of Beijing, China.
ATA Creativity debuted on the equity markets in 2008, launching its stocks on the New York Stock Exchange (NYSE) under the ticker of ‘AACG’.