SGOCO Group Ltd (NASDAQ:SGOC) Facing Strong Headwinds, Down 20.53%

Posted by Michael Korte June 13, 2013 0 Comment 868 views


Northern, WI 06/13/2013 (GDPInsider) – SGOCO Group Ltd (NASDAQ:SGOC) faced headwinds today as it struggled to recover from its slow start. The stock opened at 2.72, 0.20 cents below its previous close of 3.02. The slow start was a clear indication of the bad day ahead and SGOC is down 20.53% with a trading range of 2.20 and 2.75.

Volume exploded today to 2.156 million – a massive jump on its average volume of 297.01K.  SGOC designs and distributes liquid crystal display (LCD) consumer products, including LCD personal computer (PC) monitors, LCD televisions (TVs), light emitting diode (LED) back-light modules and application-specific LCD systems.

Operations have been solid in the last few months and SGOC delivered stunning Q1 2013 figures at its recent earnings call. According to a release from the company, both revenues and profits saw an appreciable increase over the first quarter of 2012.

SGOC reported a top line increase of 58.0% and a bottom line of 87.5% — both increase validating SGOC’s agility in the light goods sector. Year-over-year growth of revenues finished off at $54.5 million and gross profit increase by 39.6% to finish off at $3.7 million for the quarter.

SGOC is also moderately cash-rich, having reported cash and cash equivalents of 5.7 million. The company also saw a spike in working capital which increased to $79.9 million, up from the $78.1 million reported in 2012.

The very strong performance validates the appointment of Ms. Wai Man (Helen) Hsu as an Independent Director of the Company. The appointment took effect on April 26, 2013 and was seen as an urgent fill given the resignation of Mr. Yoann Normandeau, who had resigned from the Board for personal reasons.

SGOC is presently overbought with a RSI of 70.36; however, the technical chart is showing a very sharp uptrend which has pushed market valuation past the company’s SMA50 of 1.18.

 

Is SGOC a solid investment at these levels? Get exclusive data and trends here.

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About Michael Korte

Michael Korte an investigative reporter at GDP Insider and is a breaking news reporter. Michael work includes investigations of misconduct by federal prosecutors and industrial air pollution around the nation's schools. His reporting has been recognized with the Hillman Prize for Newspaper Journalism, the Grantham Prize for Excellence in Reporting on the Environment, and the Philip Meyer Journalism Award for reporting that incorporates social science methods.

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