TOP Financial shares plummet after the Hong Kong-based company reported huge earnings

Shares of TOP Financial Group Ltd. fell 12.2% in premarket trading after closing Friday’s session up 64.8% — the biggest daily percentage gain since April 28, 2023, when the stock traded increased by 441.1%.

The stock rose with trading volume of 72.63 million shares on Friday, well above its 65-day trading volume of 1.26 million shares, and was halted for volatility during the session. More than 500,000 shares changed hands Monday morning. Short interest as a percentage of TOP Financial,
the public free float of the shares was 0.86%.

Related: TOP Financial Group meme shares rise more than 890%, boosted by Reddit crowd

No apparent news has driven the rise in TOP Financial Group shares, although the Hong Kong-based brokerage has already attracted meme-like attention. TOP Financial, listed on the stock exchange in 2022, is a holding company. Through its subsidiaries, the company operates online brokerage platforms for stock, futures and options products. Last year, the company was popular among the Reddit group WallStreetBets, a key player in the meme stock phenomenon that has fueled rallies at AMC Entertainment Holdings Inc. AMC,
and GameStop Corp. GME,

The company was one of several small-cap Chinese stocks that generated meme-like buzz in 2023.

Related: Small-cap Chinese stocks spark meme-like buzz

TOP Financial has a market capitalization of $188.71 million. For the six months ended September 30, 2023, the company’s revenue was $7.1 million, up from $5.2 million in the same period a year earlier. In a statement, the company attributed the revenue increase to its revised business strategy to diversify the services it provides to clients, rather than focusing on futures brokerage commissions.

TOP Financial shares have risen 49.7% over the past 52 weeks, outpacing the S&P 500 index’s SPX gain of 21.5%.

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