Please ensure Javascript is enabled for purposes of website accessibility

Why Genius Brands Stock Surged Today

By Joe Tenebruso – Jun 10, 2020 at 6:43PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The bulls are back in charge, at least for now.

What happened

Shares of Genius Brands International (GNUS 0.88%) rebounded on Wednesday, partially reversing a sharp downward move in recent days. By the close of trading, Genius Brands' stock was up more than 13% after soaring as much as 46% earlier in the day.

So what 

Genius Brands is a highly volatile stock, with numerous factors affecting its share price movements. Investors could be buying the stock ahead of the upcoming launch of the kids' entertainment company's new Kartoon Channel! The free, ad-supported digital network is slated to go live on June 15. CEO Andy Heyward says the service will be available to more than 100 million U.S. households and 200 million mobile devices. 

Moreover, Genius Brands is a popular stock on trading platform Robinhood. Over the past day, only Tesla saw a bigger increase in popularity among Robinhood users, according to Robintrack. 

A sculpture of a bull.

Genius Brands bulls were on parade today. Image source: Getty Images.

Rumors are also circulating on Twitter and other social media platforms that Genius Brands could be a takeover target for the likes of Disney or Netflix. However, this is just conjecture on the part of traders at this point, and speculators could be spreading these unsubstantiated rumors in an attempt to drive the price of Genius Brands' stock higher.

Now what

As the bulls try to drive Genius Brands' shares ever higher, the number of people betting against the stock continues to grow. More than 30% of the shares traded are now sold short, according to Fintel. Short sellers such as Hindenburg Research are calling for the stock to fall sharply, due in part to valuation concerns, insider selling, and Genus Brands' current lack of profitability. 

With so many people betting on and against its stock, Genius Brands' investors can expect more violent price swings both to the upside and downside in the coming days.

Joe Tenebruso owns shares of Walt Disney. The Motley Fool owns shares of and recommends Netflix, Tesla, Twitter, and Walt Disney and recommends the following options: long January 2021 $60 calls on Walt Disney and short July 2020 $115 calls on Walt Disney. The Motley Fool has a disclosure policy.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Genius Brands International, Inc. Stock Quote
Genius Brands International, Inc.
$0.61 (0.88%) $0.01

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
S&P 500 Returns

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 10/03/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.