Let Luckin Coffee stock serve as your reminder to do your due diligence. Luckin Coffee Stock in a Nutshell Before it got caught, there was writing on the wall for Luckin Coffee stock. Specifically, Muddy Waters had published research about its questionable accounting practices. That work was published on Jan. 31.
Full Answer
What happened to Luckin Coffee stock?
Luckin Coffee stock burned growth investors with false numbers and left a bad taste in Wall Street's mouth You may remember Luckin Coffee (OTCMKTS: LKNCY) as the ticker symbol LK. That’s no longer the case. After revelations this past year, Luckin Coffee stock was relegated to the over-the-counter market.
Should you sell Luckin stock after its $310 million sales scandal?
Follow @tworstideas When a company gets hit by a scandal and its stock plummets, your first instinct may be to sell and cut your losses. It's to come to that conclusion about Luckin ( OTC:LKNC.Y) a fast-growing coffee chain in China that has admitted that its COO fabricated sales by about $310 million.
Will Luckin group’s (luck) stock recover from recent losses?
However, Luckin was able to recover some of those losses, ending lower by “just” 10.7% on the day. Then on Feb. 3, the company denied the report, buying investors some time to assess the news.
Is Luckin Coffee a good investment?
Key Points. Chinese stocks are under regulatory pressure. But this could be a good thing for Luckin Coffee. The company's spectacular revenue growth and reasonable valuation make it a compelling investment.
What is the future of Luckin Coffee stock?
Stock Price Forecast The 1 analysts offering 12-month price forecasts for Luckin Coffee Inc have a median target of 21.19, with a high estimate of 21.19 and a low estimate of 21.19. The median estimate represents a +77.46% increase from the last price of 11.94.
Can Luckin Coffee bounce back?
At the end of the day, Luckin Coffee is a high-risk stock. If the company manages a massive financial turnaround and reputation overhaul, it could possibly bounce back.
How do you trade Luckin Coffee?
How to buy shares in Luckin CoffeeCompare share trading platforms. Use our comparison table to help you find a platform that fits you.Open your brokerage account. Complete an application with your details.Confirm your payment details. ... Research the stock. ... Purchase now or later. ... Check in on your investment.
Will luckin coffee relist?
IPO” for his numerous award-winning work on initial public offerings – is the 313th in “The Trans-Pacific View Insight Series.” After its 2020 fraud scandal, Chinese coffee company Luckin seeks to relist on Nasdaq. Identify the key obstacles facing the company's second IPO attempt. Investor skepticism is one obstacle.
Is luckin coffee undervalued?
Still Undervalued Despite recent rally, LKNCY is still wildly undervalued based on both Price/Sales trading multiple and on per store valuation. LKNCY has not disclosed its latest financials in 2021.
Will Luckin stock recover?
Luckin Coffee has reported a positive year of trading as it emerges from the pandemic and completes a major restructuring of its debts.
Can Luckin Coffee come back to Nasdaq?
If executives stick to current plans, then it's possible investors will see the coffee chain return to the Nasdaq before the end of the year.
Is Luckin Coffee going out of business?
Luckin Coffee emerges from bankruptcy two years after accounting scandal. Luckin Coffee has emerged from federal bankruptcy protection nearly two years after the Chinese chain was found to have fabricated more than $300 million in sales.
Is Lkncy on Robinhood?
Shares of LKNCY can be purchased through any online brokerage account. Popular online brokerages with access to the U.S. stock market include WeBull, Vanguard Brokerage Services, TD Ameritrade, E*TRADE, Robinhood, Fidelity, and Charles Schwab.
Is lkncy an OTC stock?
LKNCY | Luckin Coffee Inc. ADR Stock Overview (U.S.: OTC) | Barron's.
Luckin Coffee Stock in a Nutshell
Before it got caught, there was writing on the wall for Luckin Coffee stock. Specifically, Muddy Waters had published research about its questionable accounting practices. That work was published on Jan. 31.
Now What?
Now traded on OTCMKTS, shares in Luckin Coffee stock were up 79% as of Dec. 16 from the August low. Then on Dec. 17, shares rocketed higher by almost 100% on the day. Today, the stock is even higher at $10.24. So, is that a sign to jump in?
History of Luckin Coffee
Luckin Coffee was founded in 2017 by Jenny Qian Zhiya and Charles Zhengyao Lu. And just three years later, it has grown into a Chinese coffee behemoth.
The Accounting Scandal
Luckin Coffee has been in the news quite a bit this week. This is due to the recent allegations of fraud committed by several individuals at the company. They include its chief operating officer.
The Luckin Coffee Stock Forecast
Obviously, this has been a rough week for Luckin Coffee’s stock. The question becomes: What should you do about it?
Concluding Thoughts on the Stock
At the end of the day, investment decisions always come back to the fundamentals. Does the company have an airtight business model? How is it performing financially? And does the current stock price accurately reflect these underlying components?
About Brian M. Reiser
Brian M. Reiser has a Bachelor of Science degree in Management with a concentration in finance from the School of Management at Binghamton University.
