Why ChinaCache International Holdings Ltd. Shares Skyrocketed
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: In the absence of any significant positive news, shares of ChinaCache International Holdings, Ltd. rose another 20% Wednesday.
So what: Shares are have jumped more than 40% over the past two days alone, and today's move came on more than twice ChinaCache's average volume. Even so, remember these kinds of wide swings aren't entirely uncommon as large market players step into and out of small companies like ChinaCache, the entire market capitalization for which still stands under $500 million after the pop.
On that note, ChinaCache did announce a "memorandum of understanding" with Server Farm Realty last Thursday, through which the two companies will collaborate on helping multinational businesses host their cloud services in China. That could be great news for ChinaCache, which is working hard to position itself at the forefront of developing the country's fast-growing data center industry.
Now what: However, I still think investors should tread lightly here, and prefer to let the dust settle a bit before making any long-term decisions. As it stands, I'm perfectly happy waiting for more color on its progress toward sustained profitability when the company reports fourth quarter results on March 12.
Speaking of massive potential ...
Let's face it: Every investor wants to get in on revolutionary ideas before they hit it big -- like buying PC maker Dell in the late 1980s, before the consumer computing boom, or purchasing stock in e-commerce pioneer Amazon.com in the late 1990s, when it was nothing more than an upstart online bookstore. The problem is, most investors don't understand the key to investing in hypergrowth markets. The real trick is to find a small-cap "pure play" and then watch as it grows in explosive fashion within its industry. Our expert team of equity analysts has identified one stock that's poised to produce rocket-ship returns with the next $14.4 trillion industry. Click here to get the full story in this eye-opening report.
The article Why ChinaCache International Holdings Ltd. Shares Skyrocketed originally appeared on Fool.com.Steve Symington has no position in any stocks mentioned. The Motley Fool recommends and owns shares of Amazon.com. Try any of our Foolish newsletter services free for 30 days. We Fools don't all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
Copyright © 1995 - 2014 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.