ATIF Holdings, also known as ATIF, is a company that provides business consultancy, investment and asset management services. It has centers in Los Angeles and Hong Kong as well as China. The company mainly offers IPO Advisory Services for various small and mid-sized businesses throughout North America and Asia.

Although it sounds intriguing, the company doesn’t seem like one of those meme stocks.

ATIF stock is a short-sneeze candidate that has attracted speculators. Investors could claim that this stock is already in a squeeze.

Any stock that moves from $0.50 up to $4 in less than a week is worth looking at as a short squeeze candidate. It remains to be determined if the stock will continue at these levels or go even higher as some short squeeze stocks did.

Investors betting on short selling ATIF stock will need to purchase back shares to make up the difference at higher prices. This is because ATIF stock is highly shorted.

ATIF’s high combination of short interest rate and high loan fees is one of the reasons investors believe ATIF can squeeze more. ATIF has been included in many lists that list the top short squeeze candidates.

At the moment, I am neutral about this stock. (See ATIF Holdings stock charts on TipRanks)

ATIF Holdings: Short Squeeze Candidate

As mentioned, ATIF Holdings Limited is a leading provider of financial and advisory services. It has helped Chinese companies list publically in the U.S., as well as working with U.S.-based businesses. 

Fintel says that ATIF offers a greater than average short interest and high borrowing fee rates. Short-sellers would have to spend more to retain short positions in this stock. 

ATIF stock currently has a short interest of 26.6% and a borrow fee at 57.8%. But research indicates that this stock may have a decreasing short interest. ATIF stock rose slowly, from $3 to $4 per shares during the second week of August and first week in September. ATIF stock can be purchased at a price of $3.50.

In certain ways, some investors may believe ATIF stock has been squeezed. This was stock trading at less than $1 per share not long ago.

However, this company is an interesting short squeeze candidate due to its low float (5 million shares), and other fundamentals. That’s great news for speculators.

5 for 1 Reverse Split

ATIF Holdings announced last month that the Board of Directors decided to opt for a reverse stock split of its issued, outstanding and authorized shares. Reverse splits would be done at 5:1 ratio, combining five authorized shares into 1. It was noted by the company that there wasn’t need for a shareholder vote to approve this reverse split.

This amendment was already requested by the company in its Memorandum of Association and Articles of Association on August 27. Trading on its split-adjusted basis has begun on the NASDAQ. 

Markets generally view reverse splits negatively. Because companies who combine their shares are trying to keep listing requirements in place, this is why they’re often seen negatively. ATIF is an example of this.

ATIF Holdings was notified by the Listing Qualification Department at Nasdaq on July 26, 2021. The notice told the company that it had fallen out of compliance with NASDAQ’s minimum bid price requirement of $1.00 per share. This reverse split has enabled ATIF Holdings to regain compliance as per NASDAQ’s Listing Rule.

After the Reverse Split, the company’s outstanding and issued ordinary shares have come down to 9,161,390 from 45,806,852. Stockholders with certificated shares can be helped in exchanging stock certificates. Shareholders who are in book-entry status do not have to modify their shares. 

Bottom Line

ATIF Holdings tops Fintel’s list of stocks as a potential short squeeze this week. The stock has been hovering around a bit in the recent days.

Is this going to see another run of short squeezes or is this the end of this trend? This is the main question that investors have right now.

This stock is worth keeping an eye on.

Disclosure: Chris MacDonald had no position at the time this article was published.

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