The Payright Ltd (ASX:PYR) share price has surged today, up 32% at one point. That was enough to warrant a speeding ticket from the ASX
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Payright Ltd (ASX: PYR) is the latest ASX payments share to receive a speeding ticket from the ASX after its share price went ballistic this morning. Payright shares closed at 90 cents yesterday after rising 10.4%. But the company opened at 95 cents a share this morning and rose all the way up to $1.22, a 32% surge. The shares have settled at the time fo writing, but are still going for $1.06, a 17% rise.
These moves have prompted a ‘please explain’ speeding ticket from the ASX soon after lunchtime today. This is standard procedure form the stock exchange if a company experiences a seemingly unprovoked share price rise of that kind of magnitude.
In response, Payright issued a release in which it confirmed in rather direct language that it has no idea what would have caused this surge in share price and trading volume. Here’s the gist of what Payright told the ASX: “No. The Company is not aware of any reason for the recent trading activity in the Company’s securities”.
The last market release that Payright gave the markets was back on 3 February. That release detailed a loan facility that the company has entered into, so we can probably assume that has nothing to do with today’s moves. So what’s going on?
FOMO for Payright shares?
Well, a number of companies in the same payments/fintech space as Payright have seen very similar moves to what thie company has seen today. Yesterday, we discussed how companies like Douugh Ltd (ASX: DOU), IOUpay Ltd (ASX: IOU), and Novatti Group Ltd (ASX: NOV) had all seen double-digit share price rises for no obvious reason. In fact, all 3 of those companies subsequently received speeding tickets from the ASX as a result. The share at the forefront of these rather strange moves appears to be buy now, pay later (BNPL) giant Zip Co Ltd (ASX: Z1P). Zip shares had a corker of a day yesterday, rising more than 17% (despite no major news out form the company). The shares added another 13% this morning before Zip itself got a speeding ticket of its own from the ASX.
These moves almost certainly have nothing to do with these companies’ fundamentals. So perhaps investors are seeing some very committed momentum trading in this space and trying to buy in ahead of the curve. These kinds of things can set off a chain reaction of sorts as momentum investors try and jump on the bandwagon and make a quick profit before things cool down again.
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Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of ZIPCOLTD FPO. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.