On Friday, ZAAP share price closed at $0.9, recording a total gain of another 13.92% from the previous close. Trading volume kept growing and reached 2 millions shares and the shares of ZAAP are getting even more overbought while improving also their other technical indicators. The newly hit yearly high from Friday is now at $0.95.
Market’s excitement is high, although the financial results did not show any milestone improvements and the stock appears highly overvalued relative to the fundamentals of the company. Obviously, investors bet on the future, and on the potential of ZAP to get profitable due to its recently announced and still not completed acquisition of the Chinese vehicle manufacturer Jonway Automobile.
While shorters are also trying to get a profit from that overall excitement and their portion of the whole volume exceeded 50% last Tuesday, on Thursday the company released an update on the deal. ZAP announced that it has completed the initial $10 million payment required for the acquisition of 51% of Jonway Automobile.
In regard of the weak cash position at the end of September, the company is still not saying where the rest of the needed sum will come from. But it looks like the optimistic revenue growth projections and the planned increase in the production were enough to make the market also optimistic and ignore the expected dilution from the deal.
