What happened
Shares of drone maker AgEagle Aerial Systems (UAVS 13.79%) rose quickly in early trading today, gaining as much as 21% in morning action. But it wasn't able to hold on to the price advance, with the stock sitting higher by just 7% or so at roughly 11:45 a.m. EST on Wednesday. There's a lot to unpack here.
So what
At the start of 2020, AgEagle wasn't a particularly popular name on Wall Street, living largely in penny stock obscurity. Then, late last year, there was a rumor that the company might be working with Amazon on delivery drones. While there's been no specific evidence of this, the stock took off. Over the past year, it is higher by more than 1,800%. And at one point earlier this year, the shares were up by more than 3,000%!
Image source: Getty Images.
The drop from that elevated level is at least partly a result of a short-seller that has been questioning the validity of the bullish thesis here. AgEagle has fought back, saying that the short-seller report contains notable misstatements and is an effort to manipulate the stock. Simply put, tensions are running high for AgEagle and its stock right now.
Which brings us to today, when the company announced that it has hired two high-level employees with material industry experience. Although the stock has been quite volatile, it isn't shocking to think that investors would read into the announcement. The clear takeaway being that the positive story is more likely if AgEagle is able to hire industry veterans.
Now what
AgEagle is probably best looked at as a special-situation stock right now, a type of investing that most long-term investors are probably better off avoiding. News, positive and negative, is likely to keep driving the stock-price roller coaster here as mercurial Wall Street tries to figure out what to believe about AgEagle's future.
