Although bankruptcy is a negative thing for companies since it means that said company is going out of business, meme stock traders have been targeting struggling stocks and bankrupt stocks in an attempt to force short sellers to cover their positions. This trend has been ongoing over the past few weeks with several struggling stocks making major runs. With this in mind, the latest bankrupt stock traders may be targeting is Amyris, Inc. (NASDAQ: AMRS) which filed for bankruptcy on August 10th. While the stock plummeted 79% after declaring bankruptcy, it had a 200% bounce shortly afterward. Given the rising popularity of bankruptcy plays, AMRS stock could be one to watch closely this week for a dead cat bounce.
AMRS Stock News
The ongoing bankruptcy trend started as an anomaly after Tupperware Brands Corporation (NYSE: TUP) and Rite Aid Corporation (NYSE: RAD) ran more than 800% and 100% respectively despite overwhelmingly bearish fundamentals which hint at bankruptcy, bewildering analysts in the process. It later became clear that meme stock traders were buying shares of these struggling companies in mass to force short sellers to cover their positions, causing a short squeeze.
This trend evolved when Yellow Corporation (NASDAQ: YELL) and WeWork Inc. (NYSE: WE) were targeted after hinting at bankruptcy which strengthened this trend’s association with bankruptcy. Traders became more optimistic about buying stocks of companies hinting at or declaring bankruptcy, however, due to AMRS stock’s recent price movement, this trend may have reached a new step in its evolution.
AMRS stock ran 202% after filing for bankruptcy, making it a prime bankruptcy play. As things stand, traders are becoming more likely to buy into the stock to partake in the trend which could cause AMRS stock to skyrocket, mirroring the movements of similar stocks like YELL which surged 615%, or TUP which climbed more than 800%. While it is likely the stock may run for a second time, it should be noted that it is extremely risky at the moment and traders looking to join this trend should set stop losses to minimize their losses.
@stockplaymaker1 Is keeping a close eye on AMRS stock as a sympathy play to WE stock.
@InvestmentGuru_ is watching AMRS in case it witnesses a second run.
AMRS stock is in a neutral trend with it trading in a sideways channel between $0.06 and $0.16. Looking at the indicators, the stock is below the 200, 50, and 21 MAs which is a bearish indication. Meanwhile, the RSI is oversold at 28 and the MACD is approaching a bearish crossover
As for the fundamentals, AMRS is set to delist on August 21st following its Chapter 11 filing. Although the stock previously ran 202% on its bankruptcy filing, it may see a second run this week ahead of its delisting. For this reason, traders could wait for the stock to test its support before taking a position ahead of a potential second run.
AMRS Stock Forecast
With the stock gaining momentum among traders as the latest bankruptcy play, AMRS stock has the potential to witness a second run this week thanks to the growing popularity of bankruptcy plays. However, it should be noted that the stock previously ran 202% after declaring bankruptcy, which makes it an extremely risky play. Nevertheless, the stock remains one to watch closely this week given its potential to run.
If you have questions about AMRS Stock and where it could be heading next feel free to reach out to us in our free alerts room!
Please visit and read our disclaimer here.