NQ Mobile Inc. Continues to surge forward, after suffering serious blows to investor confidence over Investigations.

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From late June to mid October, of this year, no one could deny that NQ Mobile Inc. was an absolute powerhouse among the performance of other stocks trading within that time frame. Within just those 4 months, NQ had managed to surge up more than 267%, greatly bolstering investor confidence, especially when considering that so many publicly traded companies have suffered during these times of greater economic hardships. But on October 25th, just 5 days ago, things quickly changed, with the announcement that Rya and Maniskas, LLP that they were conducting an investigation into NQ Mobile Inc, due to allegations that NQ has misrepresented its product platforms and misled investors with regard to the companies financial performance. The most damaging aspect of the report came in this:

"Specifically, Muddy Waters Research issued a report on October 24, 2013 which alleges, among other things, that NQ Mobile's Antivirus 7.0 platform is unsafe for consumer use and at least 72 percent of NQ Mobile's purported Chinese security revenue is fictitious – deeming the Company a "massive fraud."  Notably, the Muddy Waters Research report states that NQ's largest customer is actually itself; and NQ Mobile's actual market share in China is approximately 1.5%, as opposed to 55% as the company claims."

After the release of the Muddy Waters report, shares of NQ Mobile, dropped as much as 70.73% between October 21st and October 28th, marking the steepest decline within that time period that the company has seen within such a short time frame. Though the decline was very steep, recent traders getting involved in NQ have been faring well over the course of the past 2 days, as prices have spiked up from their lows, due to what many consider to be the classic bounce approach; bounce meaning that the stock is shooting upward quickly, as a result of many investors hoping that the company has hit it's bottom, at the end of a sudden steep decline. As always, we warn all readers that bounce plays are always very unpredictable, so if you have been playing this one, be sure to operate with extreme caution.

It will certainly be interesting to see how this one continues to play out, especially if the allegations turn out to be unfounded claims, so we will be keeping a close eye on what is to come. Needless to say, if the allegations do turn out to be justified, there may very well be further declines to come. We feel like the risk factor here may be too great to bother getting into the stock for now but as always, the choice is yours. We on the other hand will be looking out for other promising plays. Our Platinum Members have seen gains of almost 1,000% over the course of the past 6 weeks, on our top penny stock newsletter alerts, so if you have not already done so, be sure to subscribe to our VIP level platinum membership alerts at www.pennystockdream.com/platinum. This exclusive mebership level is the only way to receive our very best penny stock picks before they are released to anyone else.

 

 

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