ContextLogic (WISH) Stock News and Forecast: Corrects from weekly highs
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Subscribe to Premium- WISH stock corrected after the 15% spike on Tuesday.
- Volume was average, spike appears due to retail crowd appeal.
- The focus of longs is on forcing a short squeeze.
Update, December 23: The mobile eCommerce company ContextLogic Inc. (WISH) reached fresh weekly tops at $3.62, then corrected 1.69% to finish Wednesday at $3.48. The retreat in WISH is not surprising, given the massive 15% rally seen on Tuesday. The shares of the mobile eCommerce company underperformed the broader market rally, fuelled by receding Omicron fears and pre-Christmas short-covering. Despite the pullback, WISH shares remain on track to book roughly 8% weekly advance.
US stocks continued to recover Wednesday as Consumer Confidence topped expectations and existing home sales rose for the third consecutive time. The S&P 500 and the Nasdaq Composite ended higher by about 1% to 4,696.56 and 15,521.89, respectively. The Dow Jones Industrial Average gained 0.7% to 35,753.89. All sectors were in the green, with consumer discretionary and technology in the lead.
Nevertheless, the recent news that WISH's fourth-quarter revenue is expected to be below the third-quarter revenue despite the holidays has hamstrung recovery attempts as well. Overall, the news remains bleak for the fading ecommerce company. On the other hand, a short squeeze could be on the horizon due to the stock's high short percentage and squaring of positions.
WISH Stock News: betting on the short squeeze
WISH stock news has been dismal for the second half of 2021. On November 10, the firm announced that its CEO would be replaced by February 2022. The company burned through over $900 million in the first nine months of the year. Third quarter earnings showed that revenue had fallen 39% YoY, and monthly average users had dropped by 40%. It seems as if the two-sided ecommerce upstart has lost its mojo. Prior to this year, the company saw its revenue grow consistently from 2017 to 2020.
Bulls in the stock are focused on the heavy shorting taking place. About 26% of the float was shorted at the end of November, and new data is expected out this week. Additionally, some of its fans point to data showing that insider selling has trailed off since the first quarter, although outgoing CEO Piotr Szulczewski continues to sell shares. Others point to the $6.19 consensus price target on the stock, which presents 80% upside.
Either way, what is a fact is that $10 call options with an expiry date of January 21, 2022 are being bought up swiftly. Nearly 24,000 contracts have now been purchased, and open interest sits above 35,000. Bulls hope by pushing up the price of WISH, the shorts will be forced to cover.
Skeptics have a different view:
WISH key statistics
| Market Cap | $2.3 bllion |
| Price/Earnings | N/A |
| Price/Sales | 1 |
| Price/Book | 3 |
| Enterprise Value | $1.1 billion |
| Operating Margin | -31% |
| Profit Margin |
-34% |
| 52-week high | $32.85 |
| 52-week low | $2.94 |
| Short Interest | 26% |
| Average Wall Street Rating and Price Target | Hold, $6.19 |
WISH Stock Forecast: $3.95 or bust
When a stock loses 83% of its value since the start of the year, it is typically not a good bet. That is the case here, but if traders are hellbent on WISH, then they should wait on a close above $3.95. That was the top of the early December swing high. If bulls cannot reach and supercede this level, then a further largescale price spike in unlikely.
Bulls should also wait until the 9-day moving average crosses above the 21-day, which is currently at $3.53. This is a better confirmation of a move higher than just seeing that the Moving Average Convergence Divergence (MACD) indicator has already crossed over. Support remains at $2.97.
WISH 1-day chart
Previous updates
Update: The Mobile eCommerce company ContextLogic Inc. (WISH) has declined 27.3% in price over the past month and 49.1% over the past three months to close yet again below the psychological $4.00. News that WISH's CEO, Piotr Szulczewski, will be stepping down from his position no later than February 1, 2022 has continued to weigh on the stock price that can't break out of consolidation despite the Santa Clause rally taking shape on wall Street.
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- WISH stock corrected after the 15% spike on Tuesday.
- Volume was average, spike appears due to retail crowd appeal.
- The focus of longs is on forcing a short squeeze.
Update, December 23: The mobile eCommerce company ContextLogic Inc. (WISH) reached fresh weekly tops at $3.62, then corrected 1.69% to finish Wednesday at $3.48. The retreat in WISH is not surprising, given the massive 15% rally seen on Tuesday. The shares of the mobile eCommerce company underperformed the broader market rally, fuelled by receding Omicron fears and pre-Christmas short-covering. Despite the pullback, WISH shares remain on track to book roughly 8% weekly advance.
US stocks continued to recover Wednesday as Consumer Confidence topped expectations and existing home sales rose for the third consecutive time. The S&P 500 and the Nasdaq Composite ended higher by about 1% to 4,696.56 and 15,521.89, respectively. The Dow Jones Industrial Average gained 0.7% to 35,753.89. All sectors were in the green, with consumer discretionary and technology in the lead.
Nevertheless, the recent news that WISH's fourth-quarter revenue is expected to be below the third-quarter revenue despite the holidays has hamstrung recovery attempts as well. Overall, the news remains bleak for the fading ecommerce company. On the other hand, a short squeeze could be on the horizon due to the stock's high short percentage and squaring of positions.
WISH Stock News: betting on the short squeeze
WISH stock news has been dismal for the second half of 2021. On November 10, the firm announced that its CEO would be replaced by February 2022. The company burned through over $900 million in the first nine months of the year. Third quarter earnings showed that revenue had fallen 39% YoY, and monthly average users had dropped by 40%. It seems as if the two-sided ecommerce upstart has lost its mojo. Prior to this year, the company saw its revenue grow consistently from 2017 to 2020.
Bulls in the stock are focused on the heavy shorting taking place. About 26% of the float was shorted at the end of November, and new data is expected out this week. Additionally, some of its fans point to data showing that insider selling has trailed off since the first quarter, although outgoing CEO Piotr Szulczewski continues to sell shares. Others point to the $6.19 consensus price target on the stock, which presents 80% upside.
Either way, what is a fact is that $10 call options with an expiry date of January 21, 2022 are being bought up swiftly. Nearly 24,000 contracts have now been purchased, and open interest sits above 35,000. Bulls hope by pushing up the price of WISH, the shorts will be forced to cover.
Skeptics have a different view:
WISH key statistics
| Market Cap | $2.3 bllion |
| Price/Earnings | N/A |
| Price/Sales | 1 |
| Price/Book | 3 |
| Enterprise Value | $1.1 billion |
| Operating Margin | -31% |
| Profit Margin |
-34% |
| 52-week high | $32.85 |
| 52-week low | $2.94 |
| Short Interest | 26% |
| Average Wall Street Rating and Price Target | Hold, $6.19 |
WISH Stock Forecast: $3.95 or bust
When a stock loses 83% of its value since the start of the year, it is typically not a good bet. That is the case here, but if traders are hellbent on WISH, then they should wait on a close above $3.95. That was the top of the early December swing high. If bulls cannot reach and supercede this level, then a further largescale price spike in unlikely.
Bulls should also wait until the 9-day moving average crosses above the 21-day, which is currently at $3.53. This is a better confirmation of a move higher than just seeing that the Moving Average Convergence Divergence (MACD) indicator has already crossed over. Support remains at $2.97.
WISH 1-day chart
Previous updates
Update: The Mobile eCommerce company ContextLogic Inc. (WISH) has declined 27.3% in price over the past month and 49.1% over the past three months to close yet again below the psychological $4.00. News that WISH's CEO, Piotr Szulczewski, will be stepping down from his position no later than February 1, 2022 has continued to weigh on the stock price that can't break out of consolidation despite the Santa Clause rally taking shape on wall Street.
Like this article? Help us with some feedback by answering this survey:
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