GNS - Is Genius Group a good penny stock to buy the dip?
2023-09-06 12:48:29 ET
Genius Group Limited (NYSE: GNS) stock price came under pressure this week as the volatility of the penny stock continued. The shares were trading at $1, much lower than this month’s high of $2.46. In all, the penny stock has dropped by more than 86% from the highest level this year.
A high-risk investment
Genius Group is a Singapore-based company that provides education services to students from around the world. According to its website, the company has over 4.5 million students from around the world.
The biggest catalyst for the GNS stock price this week was an announcement that it will spin off its Entrepreneur Resorts (ERL) in the coming weeks.. ERL provides resorts, retreats, and co-working spaces.
Genius Group stock price has been in a deep sell-off this year amid concerns about the company’s business. In June, the company restated its annual revenue for 2021, reducing it from $12.8 million to $8.3 million. This move also affected its profits for the period.
In its annual results for 2022, the company said that its revenue jumped to over $28.1 million while its gross margins jumped to 33%. Most of this revenue growth was mostly because of the company’s acquisitions.
Genius Group ended the year with over $5.7 million in cash, $11.1 million in restricted cash, and accounts receivable of $4.9 million.
Still, Genius Group is a highly-risky company to invest in. For one, the company recently received a warning letter from the NYSE about how it disseminates information using social media platforms like X. It also violated laws about material information.
For long-term investments, I always recommend buying stable companies that you have a good understanding of how they work. Accounting issues are usually a red flag. Therefore, for long-term investors, I recommend staying away from Genius Group.
Genius Group Limited stock price forecast
The daily chart shows that the GNS share price’s attempt to recover found a strong resistance at $2.46 on August 28th. Now, the stock has pulled back and retested the 25-day and 50-day exponential moving averages.
At the same time, the Relative Strength Index (RSI) has dropped to the neutral point of 50 while the MACD has drifted downwards. Therefore, the outlook for the shares is bearish, with the next level to watch being at $0.5076, the lowest level on August 4th.
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