Alfi Inc shares tumble more than 25% from record highs, ‘meme stock’ Torchlight also sinks

imageStock Markets6 minutes ago (Jun 23, 2021 12:51PM ET)

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(C) Reuters. FILE PHOTO: U.S. one dollar banknotes are seen in front of displayed stock graph in this illustration taken February 8, 2021. REUTERS/Dado Ruvic/Illustration

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(Reuters) – Shares of new retail darlings Alfi Inc and Torchlight Energy were both down more than 25% on Wednesday, highlighting the wild ride facing investors in so-called meme stocks in a year that has thrown the spotlight on retail traders.

Shares of software firm Alfi were recently down nearly 27% at $12 after more than doubling in price to close at $16.29 in the previous session. Analysts and social media users had pointed to an article on Benzinga.com, which quoted the company’s CEO and said Alfi would buy back $2 million of its shares, as part of the reason for Tuesday’s move.

Without going into further details about any plans, the company in a regulatory filing on Wednesday referred to the article, saying it stated that “Alfi announced a new $2 million buyback plan” and CEO Paul Pereira is quoted stating “(We) will continue to buy back our stock as (a) firm commitment to our company valuation.”

Another retail darling, Torchlight Energy tumbled 29% on Wednesday, extending a 29% slide in the previous day’s session after it upsized its stock offering to $250 million.

Shares of a group of heavily shorted companies including video game retailer GameStop Corp (NYSE:GME) and cinema operator AMC Entertainment (NYSE:AMC) Holdings Inc have seen wild swings this year in a phenomenon dubbed the “meme stock” rally that has been driven by retail traders on online discussion forums.

Although short interest in Alfi last stood at 3.85% of free float, according to Refinitiv data, the company was among the top 10 trending stocks on trading-focused social media site Stocktwits, a platform commonly seen as a measure of interest from retail investors. GameStop has also cashed in on the Reddit-driven rally in its stock, saying on Tuesday it had raised $1.13 billion in its latest share offering. Its shares were up 0.2%, barely adding to a 10% gain in the previous session.

Another meme stock, Clover Health Investments Corp was up 5.8% in high-volume trading while ContextLogic Inc was down 0.3%.AMC shares were up 1.3%.

Alfi Inc shares tumble more than 25% from record highs, ‘meme stock’ Torchlight also sinks

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