Yangtze River Port (YRIV) Stock Gains Are Just Beginning

Yangtze River Port & Logistics Ltd YRIV Stock News

Yangtze River Port and Logistics Ltd (NASDAQ: YRIV) is rocketing yet again today, following up on the strong gains that the stock saw in the market on Friday. With no news out, many are asking the big question, “Why?”

Let’s face it, when we see a run like this out of a stock with absolutely no news, one of two things is happening. Either traders are grabbing hold based on technical indicators, or news is coming. In this case, I believe it’s both, and there is plenty more room ahead.

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Why The Stock Is Running

I went into a bit of detail as to why Yangtze River Port and Logistics is making its way to the top in a post on Friday. So, I’m not going to go into too much detail here. Nonetheless, for those of you that missed the post, here’s a brief overview.

In December, Hindenburg Research worked with multiple players to publish what YRIV contests is a false and misleading report. In the report, the short sellers claimed that management at Yangtze was siphoning money from the public United States market, a claim that is often blatantly and invalidly made about Chinese stocks.

While these types of claims generally have a very short term effect, in the case of YRIV, the pain is still being felt. The stock fell dramatically and continues to trade substantially lower than the close before the report was released.

As a result, the company had no choice other than to file a lawsuit. In the suit, Hindenburg Research, Nathan Anderson, ClaritySpring Securities, LLC and ClaritySpring Inc. were named as defendants. The suit claims that the report put together by these parties was filled with false and misleading statements, ultimately leading to the demise of YRIV stock for the financial benefit of those involved.

There’s a simple argument here that suggests that YRIV will come out ahead. At the end of the day, if management at the company was siphoning money, why would they open the books up to a detailed investigation? If assets were made up or overvalued in their books, as the report suggested, the same question could be asked.

On that notion alone, it would be reasonable to expect that Yangtze River has done nothing wrong here. Moreover, an independent overview of the company suggests that no money has been siphoned from the company and that asset values are relatively fair.

So, in short, the stock is climbing as investors see an easy win in the courtroom, as does the company. In fact, when filing suit, Mr. Xiangyao Liu, Chairman and CEO at YRIV, had the following to offer in a comment:

We feel as a company the best way to fight the short and distort strategy of our accuser is to operate and litigate. Our assets have been acquired and developed with real cash payments; and, the long term investment opportunity for profit leveraging our assets will ring true for our investors. This is a long and calculated battle with these short sellers, and we intend to fight with all of our capabilities using every resource available to us. We have a bright future as a member of the global economy and we look forward to the first steps on a long journey.

The Potential Here Is Incredible

While the recent run in value at Yangtze River Port and Logistics has been great, I have a feeling that it’s nothing compared to what we’re likely to see ahead. Keep in mind, at the moment, the stock trades at a price of around $1 per share, even after the dramatic gains that we’ve seen in the last two trading sessions.

Before the report was released by Hindenburg Research, YRIV shares were trading at around $11.65 per share. Now, I get that there is a lot of uncertainty here, and that’s what’s holding the stock down. However, I also believe that once the courtroom battle is over, Yangtze will easily be able to show that its valuation was on point, leading to a dramatic run for the top.

Let’s say that YRIV doesn’t make it to $11.65 after the battle is over and only runs to $10, which is still a strong discount. That growth would represent gains of more than 10X. That’s a very big deal! Moreover, it’s also a very reasonable expectation considering all factors associated with the declines and case filed against Hindenburg and its co-conspirators.

The Bottom Line

The bottom line here is a simple one. Hindenburg Research and its co-conspirators caused serious pain for YRIV and those who own stock in the company. As a result of an invalid report, they are likely to have to pay a hefty settlement and faith in Yangtze will likely quickly be restored. As a result, there’s an opportunity brewing here that’s hard to ignore!

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6 thoughts on “Yangtze River Port (YRIV) Stock Gains Are Just Beginning”

    1. Not as of yet. Some cases can take years. I don’t expect this one to take long though. It’s pretty cut and dry.

    1. It is a threat, but given the circumstances surrounding the stock, I don’t believe delisting will take place. Looking at the SEC filings and documents surrounding the delisting, it seems as though the decision was made based on the invalid short report. The company has an appeal with the Nasdaq, one that I believe they will win, maintaining their listing ahead.

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