iQIYI, Inc. (IQ) Short Interest Declines. Here’s How to Prepare

In the latest fortnight, short interest in iQIYI, Inc. (NASDAQ:IQ) stock reduced by 12.71%, indicating a significant rise in bullish sentiment. When it comes to determining how a name is viewed by investors, short interest is often a useful tool. The average analyst recommendations at 2 suggests buying these shares. Between December 14 and December 31, the total number of shorted shares amounted to 44.16 million shares. That was 6,432,420 less shares than the total of 50.59 million shares in the space of prior two weeks, which means more traders or funds betting that the stock will go up. Average daily volume for IQ at the December 31st settlement plunged to 7,276,553, as compared to 8,100,437 at the December 14th report. That brought days to cover to 6.06891, a 2.83% decrease from the 6.245733 days to cover recorded at the prior short interest data release.

iQIYI, Inc. (IQ) will probably climb 52.58 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $34.4-month high price target. This represents a whopping 93.04 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $29, which represents a return potential of 62.74 percent when compared to the closing price of the stock of $17.82 on Friday, January 11. The lowest price target for the stock is $22 — slightly more than 23.46 percent from IQ’s current share price.

The stock is currently hovering around the first support level of $17.53. Below this, the next support is placed in the zone of $17.24. Till the time, the IQ stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 55.03 on daily chart, which may remain a cause for concern. If the price breaks below $17.24 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $18.25 mark may result into a pull-back move towards $18.68 level.

On 11th of January, iQIYI, Inc. (NASDAQ:IQ) shares ended lower after a volatile session. The shares dropped -0.34 points or -1.87 percent at $17.82 with a heavy trade volume of 11.3 million shares. After opening the session at $18.1, the shares went as high as $18.3869 and as low as $17.67, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $13.1 billion and now has 737.47 million shares outstanding. iQIYI, Inc. (IQ) stock has lost -1.11 percent of market value in 21 trading days.

IQ stock has a trailing 3-year beta of 0, offering the possibility of a lower rate of return, but also posing less risk. The portion of a company’s profit allocated to each outstanding share of common stock was $2.38 a share in the trailing twelve months. The stock’s value has surged 19.84 percent year to date (YTD) against a decline of 0 percent in 12 month’s time. The company’s shares still trade -61.45 percent away from its 1-year high of $46.23 and 24.18 percent up from 52-week low of $14.35. The average consensus rating on the company is 2, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a buy.

Shares of iQIYI, Inc. (IQ) are trading at a P/E ratio of 8.55 times earnings reported for the past 12 months. The industry IQ operates in has an average P/E of 25.67. Its P/E ratio went as low as 0X and as high as 0 over the 5-year span. Further, it is sporting a 3.92 on the Price-to-Sales ratio. Compare this with the industry average P/S of 5.62. -1.6 percent is the gross profit margin for iQIYI, Inc. and operating margin sits at -25.6 percent. Along with this, the net profit margin is 41.2 percent.

Let’s take a look at some insider activity at iQIYI, Inc. (NASDAQ:IQ) and see the pattern.