NQ Mobile's Battle With Muddy Waters Is Far From Over

When NQ Mobile Inc. was accused of fraud by noted short seller Muddy Waters in October, shareholders endured a harrowing 60%-plus drop over the course of only a few days. However, things had seemed uncharacteristically quiet the past couple of months -- at least, apart from a slew of press releases from NQ regarding new partnerships, and watching several hedge funds open significant passive stakes in the Chinese mobile Internet services company.

But that all changed on Friday, when shares of NQ plunged 20% after its fourth-quarter report badly missed earnings expectations. Sure enough, Muddy Waters unsurprisingly renewed its assault on NQ Mobile in a new research report this weekend, helping shares fall another 13% on Monday.

Fortunately for weary shareholders, the stock rebounded nicely to the tune of 14% Tuesday, after NQ called the selloff "ridiculous"' and announced it had repurchased shares as a result. However, the Fool's Steve Symington argues in the following video that he saw a little too much credibility in the short seller's claims to be able to take them with a grain of salt. To hear exactly what raised Steve's eyebrows while delving into NQ's results, please watch the full video.

Are you ready to profit from this $14.4 trillion revolution?
If not in NQ Mobile, then where can investors put their hard earned money to work?

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 NQ Mobile's Battle With Muddy Waters Is Far From Over 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.

Read Full Story