Troika Media Group, Inc. (NASDAQ: TRKA) is a brand consultancy and marketing innovations company that provides integrated branding and marketing solutions for global brands. After withdrawing its registration statement filed back in April 2022, TRKA stock has been gaining momentum with the stock climbing as much as 49% since the potential dilution is now off the table. Meanwhile, TRKA is climbing investors’ watchlists thanks to its high short interest rate. Given the stock’s short squeeze potential, TRKA stock is one to watch closely over the coming weeks as more news could be approaching.
TRKA Stock News
Utilizing emerging technology to deliver performance-driven business growth for its clients, TRKA has been working with some of the largest brands in the world like Coca-Cola, Amazon, and Nike. Thanks to its connections to such large companies, TRKA has been gaining investors’ attention as it could be poised for substantial growth in the long term. With this in mind, TRKA has been actively working to grow its business and acquired Converge Direct LLC and its affiliates last year. As a leading digital and offline performance media and marketing company, Converge works with its clients to organize a one-to-one targeted media strategy on a mass scale. As a result, Converge’s clients can drive engagements with their existing and new audiences.
By acquiring Converge, TRKA is positioning itself to create a global end-to-end brand solutions platform thanks to the innovative technology capabilities to expand the range of its client solutions. In addition to the technological benefits, Converge provides TRKA with substantial financial benefits since it was able to generate $300 million in annualized revenue in 2021. At the same time, Converge is already a profitable company – realizing a net income of $21 million for 2021. In light of this, TRKA has the potential to become a global leader in its sector thanks to the combined capabilities of its current business and Converge.
Although the company appears to be on track for significant growth, TRKA stock has been soaring lately following the withdrawal of its registration statement filed back in April 2022. That initial filing allowed the company to offer its shares to the public – diluting its shareholders’ interests in the company. Since the company withdrew this filing, new investors have been attracted to TRKA stock as the risk of dilution is now off the table.
TRKA also ensured its shareholders that no shares have been offered as part of the registration statement – maintaining their value. At the same time, TRKA does not have any plans to pursue a public offering of its shares or other securities which is a positive update for long-term investors.
Meanwhile, investors are increasingly bullish that major news could be on the horizon as the company recently increased the salary of its CEO Sadiq (Sid) Toama, and added a new incentive bonus related to a “triggering event” to his employment agreement along with the CFO Erica Naidrich. According to TRKA’s filing, this triggering event is the earliest to occur of the consummation of a change in control or a financial transaction. This financial transaction is related to the refinancing, refunding, or restructuring of the debt payable under a financing agreement.
On that note, TRKA recently entered into an amended and restated limited waiver with Blue Torch Finance LLC regarding certain events of default under a financing agreement they entered in March 2022. This waiver is set to expire on the earliest of the occurrence of an event of default, TRKA’s failure to meet certain sale and refinancing milestones, or June 20 – with the potential for a 60-day extension – in case the company is pursuing a sale transaction. In light of the language included in the waiver, investors are speculating TRKA could be bought out which would bring significant value to its shareholders. In that case, TRKA stock has the potential to soar on any news regarding a buyout.
Although a potential buyout remains speculations only, TRKA has the potential to continue its run thanks to its short squeeze potential. Currently, TRKA has a high short interest rate of 50.2% with 67.3% of its float on loan. Based on these numbers, TRKA stock could be a strong short squeeze candidate considering the bullish sentiment surrounding the stock. For this reason, TRKA stock could be a profitable investment to take advantage of its price movement. With the company expected to post its Q2 earnings soon, a short squeeze could be triggered if the company posts positive financials.
TRKA Stock Financials
Looking into TRKA’s Q1 report, the company has $205.4 million in assets – including $32.6 million in cash. TRKA also has $192 million in liabilities – of which $65.2 million is long-term debt. In terms of revenues, TRKA reported a record $119.8 million in Q1 – a major increase from $8.3 million in the same year-ago period. Considering TRKA’s operations growth, operating costs increased from $7 million to $12.4 million YoY. Despite this, TRKA reported a net profit of $1.2 million compared to a net loss of $2.1 million in the previous year. Based on TRKA’s impressive revenue growth in Q1, many investors are bullish the company could be on track to post record revenues in Q2 – which could be a major catalyst for a potential short squeeze.
Media Sentiment
@TRUExDEMON is bullish on TRKA’s high trading volume.
@ChartedInvests expects TRKA to further soar once it cools off from current levels.
Technical Analysis
TRKA stock price is currently trading at $.2820 and has supports near .2588, .2096, and .1503. Meanwhile, the stock shows resistances near .3038, .3796, and .4777. Following the withdrawal of its registration statement, TRKA stock has been landing on investors’ radars as dilution is now off the table. In this way, the stock soared by as much as 49% overnight. With the stock gaining investors’ attention thanks to its short squeeze potential, TRKA could be one to watch closely this week as the stock could be set to further run.
Despite the bullish sentiment surrounding the stock, TRKA failed to break through its resistance. However, it is worth noting that the stock is receiving significant attention which could allow the stock to further run over the coming weeks thanks to its high short data. With this in mind, a major catalyst could be approaching for TRKA as it is expected to post its Q2 earnings soon and news regarding a potential buyout could drop. In light of these potential catalysts, bullish investors could enter a starter position at the current PPS and average up as the stock price moves. However, investors should note that there is a gap near $.22 that could be filled with strong selling activity.
Although accumulation spiked on TRKA’s withdrawal of its registration statement, it took a major hit following its run which could be attributed to investors taking profits. Meanwhile, the MACD is bullish to the upside. The RSI cooled off from 76 to 63 which leaves enough room for TRKA to run if it continues to witness a high trading volume. TRKA has an OS of 67.8 million and a low float of 29.8 million.
TRKA Stock Forecast
Providing services to some of the world’s largest brands, TRKA could be a bargain at current levels thanks to its growing business. With the company reporting record revenues in Q1, investors are increasingly bullish that TRKA could be on track to deliver impressive Q2 earnings. Meanwhile, investors are speculating TRKA could be bought out soon in light of the recent incentive bonus added to the CEO and CFO employment agreements. Considering TRKA’s status as one of the most shorted stocks, these potential catalysts could trigger a short squeeze that could send TRKA stock to new highs. For this reason, TRKA stock is one to watch closely over the coming weeks in anticipation of more news.
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