Stocks often run after dilution due to opportunistic investors taking advantage of a stock’s low PPS. A possible instance of this phenomenon is Innovative Eyewear, Inc. (NASDAQ: LUCY). Currently, LUCY is in the midst of an offering which has caused the stock to plummet 38%. That said, the stock’s current PPS is lower than the offering price which could see LUCY stock rebound once the offering closes on June 26. With this in mind, LUCY is a prime short squeeze candidate this week with its high short interest rate. For this reason, LUCY stock is one to watch closely this week in anticipation of a rebound to pre-offering levels.
LUCY Stock News
As things stand, LUCY’s ongoing offering is expected to close on June 26 which could result in a major stock run. The offering consists of 4.5 million shares worth $1.05 per share which in turn adds up to $4.725 million. Currently, the stock is trading below the offering price at $.93 which indicates that the stock may have a post offering pump to better reflect its value. Low PPS aside, two other compounding factors that might contribute to a potential run are LUCY’s history and its swelling short data.
The history of a stock can sometimes be a great indicator of potential runs. For example, LUCY stock has experienced two +190% runs after the stock tested its $1.37 support. One of which occurred in February when the stock ran 192% after testing its $1.37 support and the other occurred in April and resulted in a 300% run after the retest. Based on this, investors could be inclined to buy shares of LUCY near the current support to capitalize on a potential similar run.
Short Data
A short squeeze might be on the horizon for LUCY stock seeing that its potential post offering pump might cause a $1.37 support retest that could cause the stock to surge. It is currently experiencing accumulating short data which is extremely opportune given the timing. LUCY’s short interest is at 37% due to a 1250.9% rise this week, and its free float on loan is at 28% due to a 642.33% rise this week. Additionally, its utilization is at 91.1% and its cost to borrow is at 306%. That said, its short sellers might get squeezed due to mass buying when the offering ends on the 26th, especially since investors might expect the stock to echo its previous runs.
LUCY Stock financials
According to the stocks Q1 2023 report its assets increased QoQ from $4.68 million to $5.11 million, meanwhile, its cash balance remained relatively unchanged only decreasing slightly from $3.5 million to $3.4 million. On the other hand, liabilities decreased QoQ from $665 thousand to $562 thousand.
In terms of revenue, LUCY suffered a significant plunge YoY from $236 thousand to $144 thousand. At the same time, operating expenses increased from $1.2 million to $1.4 million. These two compounding factors resulted in LUCY’s net loss also increasing from $1.2 million to $1.4 million.
Media sentiment
@ChaseMacTrades believes LUCY’s history will repeat itself.
@_TraderZero_ is expecting a substantial ROI on LUCY Stock
Technical Analysis
LUCY stock is in a bearish trend and is trading in a downward channel. Looking at the indicators, the stock is trading below the 200, 50, and 21 MAs. Meanwhile, the RSI is oversold at 23 and the MACD recently turned bullish. It is also worth noting that there is a gap near $1.35 that has to be filled which formed on the announcement of the offering.
As for the fundamentals, LUCY stock has an upcoming catalyst in the closing of its ongoing offering. Given that the stock is trading below the offering price and its high short interest, LUCY could be well-positioned to run this week once the offering closes. With the stock trading near support and the RSI oversold, the current PPS could prove to be a good entry point ahead of a potential post offering pump that could see the stock fill the gap it recently formed on the announcement of the offering.
LUCY Stock forecast
There is a good possibility that LUCY stock may go on a major run when its offering ends on the 26th of June. This may at first seem like a run of the mill post offering pump, but that is not the case due to the stock’s high short interest, and its history of going on major runs.
If you have questions about LUCY stock and where it could be heading next feel free to reach out to us in our free alerts room!
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