U Power Stock Forecast: UCAR sheds 35% after explosive IPO
Premium|Take advantage of 60% OFF on your first month.
Grab this special offer, it's 7 months for FREE deal! And access ALL our articles and analysis.
You have reached your limit of 5 free articles for this month.
BLACK FRIDAY SALE! 60% OFF!
Grab this special offer, it's 7 months for FREE deal! And access ALL our articles and analysis.
CLAIM OFFER- UCAR stock rose 620% on Thursday IPO.
- U Power is a Chinese battery-swapping company.
- IPO shares priced at $6 sent as high as $75 on Thursday.
- UCAR stock shed some 35% at Friday's open, moving back to $28.
It had to come back to earth eventually. Following Thursday's statospheric IPO, U Power (UCAR) stock is down 35% at the open on Friday to $28. After listing its shares at $6, the Chinese micro-cap focused on EV battery-swapping technology saw its shares rise as far as $75 before closing just above $43.
The NASDAQ, S&P 500 and Dow were flat at Friday's open.
U Power stock news
Very little is known about U Power. The micro-cap stock says it has a vision to become "a comprehensive EV battery power solution provider in China," but it does not appear to have any revenues to speak of at the moment.
Trading on Thursday had to be halted 22 times due to the volatile price action of UCAR stock. The reason for the price action moving so wildly is that the company only sold 2,416,667 shares at IPO. Small allotments at IPO mean that demand can easily overtake supply quickly, which is why the stock moved up 620% in just one session. When it traded up to $75 mid-session, its return was above 1,000% briefly.
This type of Chinese IPO has happened a number of times over the past few years with other lightly-traded stocks like Magic Empire Global (MEGL) exploding 5,800% on its IPO in mid-2022 before eventually giving back 99% of its gains. The NASDAQ briefly halted all Chinese IPOs last October to look into the issue. What all of these issuances have in common is that they offer microscopic floats in order that demand easily exceeds supply.
U Power is expected to have gross proceeds of just $14.5 million following the IPO after underwriting expenses. The stock was led by a single book runner – WestPark Capital – although Orientiert XYZ Securities Limited was listed as a co-manager. The company said it will use the proceeds for "developing and marketing UOTTA-powered EVs, manufacturing and developing UOTTA-powered battery-swapping stations, developing and upgrading UOTTA technologies, and working capital purposes."
U Power stock forecast
The sell-off in U Power stock means that bulls will look for another entry. Most of these micro-cap Chinese stocks have a few days of surges before bulls give up and take their profits. Thus far, we have seen some resistance around $40 and some support in the area between $28 and $32. Interestingly, U Power is not yet in overbought territory on the Relative Strength Index (RSI).
- UCAR stock rose 620% on Thursday IPO.
- U Power is a Chinese battery-swapping company.
- IPO shares priced at $6 sent as high as $75 on Thursday.
- UCAR stock shed some 35% at Friday's open, moving back to $28.
It had to come back to earth eventually. Following Thursday's statospheric IPO, U Power (UCAR) stock is down 35% at the open on Friday to $28. After listing its shares at $6, the Chinese micro-cap focused on EV battery-swapping technology saw its shares rise as far as $75 before closing just above $43.
The NASDAQ, S&P 500 and Dow were flat at Friday's open.
U Power stock news
Very little is known about U Power. The micro-cap stock says it has a vision to become "a comprehensive EV battery power solution provider in China," but it does not appear to have any revenues to speak of at the moment.
Trading on Thursday had to be halted 22 times due to the volatile price action of UCAR stock. The reason for the price action moving so wildly is that the company only sold 2,416,667 shares at IPO. Small allotments at IPO mean that demand can easily overtake supply quickly, which is why the stock moved up 620% in just one session. When it traded up to $75 mid-session, its return was above 1,000% briefly.
This type of Chinese IPO has happened a number of times over the past few years with other lightly-traded stocks like Magic Empire Global (MEGL) exploding 5,800% on its IPO in mid-2022 before eventually giving back 99% of its gains. The NASDAQ briefly halted all Chinese IPOs last October to look into the issue. What all of these issuances have in common is that they offer microscopic floats in order that demand easily exceeds supply.
U Power is expected to have gross proceeds of just $14.5 million following the IPO after underwriting expenses. The stock was led by a single book runner – WestPark Capital – although Orientiert XYZ Securities Limited was listed as a co-manager. The company said it will use the proceeds for "developing and marketing UOTTA-powered EVs, manufacturing and developing UOTTA-powered battery-swapping stations, developing and upgrading UOTTA technologies, and working capital purposes."
U Power stock forecast
The sell-off in U Power stock means that bulls will look for another entry. Most of these micro-cap Chinese stocks have a few days of surges before bulls give up and take their profits. Thus far, we have seen some resistance around $40 and some support in the area between $28 and $32. Interestingly, U Power is not yet in overbought territory on the Relative Strength Index (RSI).
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.