Financial Advisors Eyed Helios and Matheson Analytics (HMNY) in February Amid Drop in Stock Price but Positive Business Signs
The US stock market had a tumultuous month in February, marked by periods of high volatility, which ended with a drop in all three indexes. Even though the fourth-quarter earnings season was pretty strong with a majority of companies posting better-than-expected EPS and sales figures, investors grew more and more concerned that a growth in inflation could result in the Federal Reserve speeding up interest rate hikes and even increasing interest rates this year to higher than had been previously expected.
In this way, the S&P 500 lost 2.6% during February, which ended the 15-month rally, the longest in its history. The Dow Jones Industrial Average slid by 3.73% and registered its worst week in two years between February 5 and February 9, traveling more than 22,000 points and was on path to close its worst week since October 2008 during the financial crisis. Tech-heavy Nasdaq Composite performed the best among the three main indexes, although it also inched down by 1.33% last month, helped by strong earnings. At the same time, the 10-year Treasury yield, a benchmark that guides other interest rates, increased by over 5% and ended the month at 2.89%.
On the macroeconomic front, aside from concerns regarding tighter monetary policy, investors also welcomed the new Fed chair Jerome Powell, who appeared in front of the US House of Representatives’ Financial Committee on February 27, where he pointed out the strong economy and suggested that the Fed would continue to balance between “avoiding an overheating economy and bringing price inflation to 2% on a sustained basis.” The US dollar dipped briefly to its lowest point since December 2014 amid a rally registered in stocks in the middle of the month, but then recovered and ended the month slightly higher.
In the meantime, several stocks captured the attention of Financial Advisors. According to TrackStar, InvestingChannel’s official newsletter capturing and analyzing the trends of Financial Advisors, the most searched ticker among Financial Advisors last month was Helios and Matheson Analytics Inc (NASDAQ:HMNY), which got in the spotlight on the back of a unit offering and positive developments related to its MoviePass subsidiary. On the second spot was Netflix, Inc. (NASDAQ:NFLX), which posted a great fourth quarter report at the end of January, with subscriber growth smashing estimates and was on path to break past the $300 mark, which it has breached earlier this month. In addition, Netflix, Inc. (NASDAQ:NFLX) was on the radars last month following FCC publishing the reversal of net neutrality rules, which allowed a group of 23 state attorneys general to file a lawsuit challenging the rollback of net neutrality. Legislators have 60 days to overturn the decision since its publication on February 22. The rollback of net neutrality is a major win for Internet service providers, but can affect online heavyweights like Google, Netflix and Facebook.
Two other stocks that ranked as the third and fourth most-searched tickers last month are small-cap Applied Optoelectronics Inc (NASDAQ:AAOI) and nano-cap Cemtrex Inc (NASDAQ:CETX), both of which disclosed worse-than-expected financial results for the last quarter. The list of top five most-searched tickers is rounded up by Facebook Inc (NASDAQ:FB), which posted its results on January 31 and even though it managed to beat EPS and revenue estimates, it also indicated the slowest quarterly growth.
Let’s now take a closer look at Helios and Matheson Analytics Inc (NASDAQ:HMNY) and see the developments that made it the most searched ticker among Financial Advisors last month. Helios and Matheson Analytics Inc (NASDAQ:HMNY) is a small-cap provider of information technology services and solutions. It owns a number of subsidiaries, including MoviePass, a provider of movie theater subscription services. The company made headlines in February alongside other theater stocks on the back of strong viewership figures for Black Panther. Also, last month, MoviePass topped 2.0 million subscribers and partnered with Fandor to provide a limited time offer that included a bundled plan at $7.95/month, which allowed subscribers to get a year of streaming from Fandor and visit the theater every day.
However, the most important piece of news regarding Helios and Matheson Analytics Inc (NASDAQ:HMNY) last month is its unit offering. On February 12, the company announced that it had launched an underwritten public offering and planned to sell $105 million worth of A-1 units at $5.50 apiece. Each unit includes one share of common stock and one warrant to purchase an additional share. The pricing announcement caused Helios’ stock to dive and it lost over 49% during February.
In addition, Canaccord Genuity initiated coverage of Helios and Matheson Analytics Inc (NASDAQ:HMNY) on February 22, setting a ‘Buy’ rating and $15 target. Canaccord analysts cited the strong subscription figures of MoviePass and consider that the growth of subscribers could allow MoviePass and Helios to obtain more bargaining power and push costs lower enough to reverse the negative gross margins.