1 Stock You Shouldn't Buy Even Though It's Dirt Cheap

The stock of American Virtual Cloud is close to its lowest point. The stock looks cheap, but it is fundamentally weak and could be avoided. Continue reading...

shutterstock.com - StockNews

American Virtual Cloud Technologies is a pure play cloud communications and collaboration company. The Kandy cloud communications platform is a real-time communications platform.

The low of the company was on August 23, 2022. The high of the stock was on September 10, 2021. The stock closed at $0.17 over the past month.

It has lost 95.2% over the last year and 93.1% so far this year. The stock is below its 50-day moving average and its 200 day moving average.

In the near term, here is what could affect the performance of AVCT.

The Fed has persisted in its hawkish stance.

The chances of another 75-bps rate hike this month are increasing. The FedWatch tracker shows that the probability of a three-quarter point hike went up to 18%.

The interest rate sensitive and tech heavy index has lost more than twenty percent of its value. The Fed's monetary tightening could cause further turmoil, and fundamentally weak stocks in the tech industry could lose a lot of money.

The topline performance was weak.

The total revenues for the second quarter were $3.72 million, down 24.8% from the second quarter of last year, and the cloud subscription and software revenues were $3.62 million, down 10.8%.

The year-ago period saw a gross profit of over a million dollars. Its loss from continuing operations was up 105.6%.

POWR ratings reflect bad news.

A Sell rating equates to a D rating in the POWR Ratings system. The POWR Ratings are calculated using 118 different factors.

A grade of D is given to sentiment. Its revenue is expected to decline in the next four years. It has a D grade for stability, which is in line with its beta.

The Technology - Services industry has 81 stocks. The industry is given a rating.

Click here to get the additional POWR ratings. You can view all of the top stocks here.

The bottom line.

The broader market sell-off has had a negative effect on the momentum of AVCT. Its top line is in bad shape. I think it's a good idea to avoid the stock given the gloomy growth estimates.

American Virtual Cloud Technologies, Inc. stacks up against its peers.

One might consider looking at the industry peers of AVCT, such as Celestica Inc., ISDR, and Box, Inc.

The company's shares were trading at $0.18 per share on Friday. The benchmark S&P 500 index has risen over the course of the year, but the AVCT has fallen.

Riddhima loves analyzing financial instruments. She helps investors make informed investment decisions with her insightful commentaries.

There is more.

The post 1 stock you shouldn't buy even though it's dirt cheap appeared first on Stock News.

• All of the airline business was lost on the day after 9/11. One Son's strategic rebrand has brought success.

• You have to leave your ego behind in order to practice active listening.

• You could increase your click-through rate by using this color in your ads.

• I wrote myself a check for a million dollars when I had nothing. This is why.

• The tech platform was inspired by his grandma's garden.

• If you want to get rich in the restaurant industry, there are 7 things you need to know.

• Yankee Candle founder's $23 million estate includes an indoor water park and two car barns.