WeShop Holdings (NASDAQ: WSHP) shares soared to $200 each by the end of trading, although it fell back to $122 in after hours trading on Wednesday.
Forbes published an online article on WeShop in the afternoon. It was cautious about the company which it called “financially fragile” and said the shares were “a high-risk, high-volatility speculative play with a potentially bumpy ride ahead”. However, it points out that the US market can be attracted by the story rather than fundamentals.
The share price had gone above $237 earlier in the day, having closed at $36.47 the previous day. The Forbes article may have sparked profit-taking after the close. There is still an opportunity to take advantage of the price rise to raise money.
The market capitalisation has soared to $4.66bn. The volume traded on Wednesday was 268,436 shares. Remember, this is just the A shares. Ther are also B shares issued to shoppers using the social commerce platform.
WeCap (LON: WCAP) owns 11.8% of WeShop. That is 806,022 shares directly and 2.08 million shares via a 23.5% holding in Community Social Investments Limited (CSIL). WeCap has a discounted capital bond of £6.97m. Even taking this off, the valuation appears to be around 22p/share – based on the $122 share price. WeCap shares rose 50% to 2.7p, which is still below the level in September, valuing it at £15.4m. There were 34.9 million shares traded on Wednesday.
Hot Rock Investments (LON: HRIP) has a portfolio of shares, as well as 150,000 shares in WeShop. This stake is valued at $18.3m. The Hot Rocks Investments share price has not moved from 1.2p, which values it at £2.8m. There have been two trades this week.