AMTD Digital has been making a lot of buzz on Wall Street since its IPO last month. The small Asian fintech company is being compared to meme stocks such as Game Stop and AMC, but not so fast, say some experts. Cheddar News breaks down the wild ride that is this new, volatile stock.

Closing Bell

AMTD Digital Makes Waves — But Is No Meme Stock

and welcome back to closing bell on Shadow News. Everyone, a little known asian Fintech company called A. M. T. D. Digital has even stock price skyrocket since its I. P. O. Last month at one point it was that more than 21,000% and the price by temporarily putting its market cap in the range of companies like Toyota, Pepsi and even Disney, the wild surge also already been compared to the rise of meme stocks like am seeing Gamestop. But are the situations really that similar joining me now to break it down as a reporter Alex? Hello Alex is fascinating. And while at the same time do you think this is the next big meme stock or does the label not really fit in this case? Hey Kristin. So there has certainly been some buzz about this company on social channels like Wall Street bets particularly today as the media has really started covering this price spike. But if you look at the actual trading volume, you're not seeing the kind of widespread retail adoption that you saw with something like Gamestop. I mean just to look at the numbers yesterday, there were 350,000 trades for A. M. T. D. Compared to, you know, hundreds of millions at the peak of meme stock mania in 2021 for a company like Gamestop, it is incredible. Um, the chart that we're showing here. So if retail investors aren't behind this extraordinary price bike Alex, what other factors might be causing it. So from what we know for now. I mean one of the best explanations that I've seen, analysts really put out there is that we're talking about a basic problem of supply and demand. You were talking about a relatively small number of shares that were issued in that I. P. O. And a relatively high level of demand. Uh, and when you have a situation like that, it can be ripe for manipulation. Now, that might not be what's happening here, but it is worth pointing out that this is exactly the kind of situation that we've seen with a number of stacks and other offshore companies that have listed here in the U. S. Where, you know, a small number of shares are being issued and it's very easily for it, the price to be manipulated. Okay, well, what do we know about the company itself? I would guess most viewers haven't heard of this company unless they were actually buying and selling in this case. But is there something going on behind the scenes that might explain the sudden interest that we see from Wall Street? Yeah, so I read through its prospectus, there's a lot of, a lot of nice buzzy words in there from what I can tell, it's they're offering digital financial services to asian entrepreneurs and corporations. But when you look at the actual numbers for the 10 months leading up to february 2022 the company raked in about 25 million. That is very small amount when you're looking at the price range that we're now seeing with this number. So overall there's not much in its uh you know in the actual numbers that would suggest it needs that it will be going, it should be going in the direction that it is now. It's also worth pointing out that the parent company that underwrote this I. P. O. Does have a track record of supporting companies that sort of come out the gate. They are issued publicly on the U. S. Stock exchange and then they very quickly explode and finally or implode rather. And then finally if you look at the ceo of this company Calvin choi, he does have a bit of a track record of financial malfeasance. As recently as june, the Hong kong securities regulator was trying to ban him from the industry for professional misconduct, yikes. Um Well Alex, I know you'll continue to stay on this story. Um it is definitely a fascinating one that said a reporter Alex. Hello Alex, thank you as always