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Stocks of Ebang International Holdings Inc. (EBON:US, NASDAQ:EBON), a Chinese blockchain firm, rose four per cent pre-market on Tuesday, June 15. The software stock galloped by 10 per cent in the previous trading session.
In the last year, the stock has plummeted by 75 per cent from its 52-week high of US$ 14.95 apiece (on September 17, 2020). It is currently trading at US$ 3.81 apiece (at 9.55 am EST).
The stock's value was impacted due to the Chinese government's recent crackdown on bitcoin mining businesses. However, Ebang claims that the action had no impact on its operations.
In the last one month, the stock witnessed renewed investors' confidence on the back of rising bitcoin prices and recovered 36 per cent.
Let us explore this undervalued technology stock's financials and price-performance:
Ebang International Holdings Inc. (EBON:US, NASDAQ:EBON)
Ebang is a blockchain technology company that designs and develops application-specific integrated circuit (ASIC) chips. In addition to this, the firm has become a leading crypto mining equipment manufacturer in the international market.
The company plans to launch a digital asset platform to expand its footprint in the cryptocurrency market. It has a current market cap of US$ 522 million.
The blockchain's 200-day simple moving average (SMA) technical data indicates that stock went through a massive sell-off during the last three months. However, it has bounced back by 18 per cent against 30-day SMA, representing a short-term bull run.
Ebang's listing-to-date stock performance against moving average multiple and volume. (Chart Source: EODHD/Others)
The stock's price trajectory has surpassed the moving average multiple, and its one-day volume soared over 13.58 million shares against the 10-day average volume of 7.64 million shares.
As of December 31, 2020, the company held total cash and cash equivalents of US$13.67, up against US$3.46 million a year ago.
However, its total revenue dropped 82 per cent year-over-year (YoY) to US$19.00 million in the full fiscal year of 2020, compared to US$ 109.06 million in 2019.
Ebang posted an interest income of US$ 0.82 million in the fiscal year 2020 against US$ 0.22 million a year ago. The YoY surge in interest income was due to rising interest income from bonds.
Data indicates that the company's financial health is on shaky grounds. On top of that, the Chinese government has a stringent stance on the power-hungry cryptocurrency industry.
It could be a risky bet to invest in this blockchain stock amid macroeconomic circumstances. However, bitcoin's future bull run may propel its growth.
Please note: The above constitutes a preliminary view and any interest in stocks should be evaluated further from an investment point of view. The reference data in this article has been partly sourced from EODHD/Others.
