Personal Finance

Why Shares of Cheetah Mobile Popped Today

A coin with a B on the face, against a background of a chart.

What happened

Shares of mobile app developer Cheetah Mobile (NYSE: CMCM) jumped on Thursday following a report from a Chinese-language website stating the company is planning a blockchain-related initiative. The report cited an interview with the CEO of Cheetah Mobile. The stock was up about 15% at 11:30 a.m. EST.

So what

Cheetah Mobile will reportedly focus on helping users protect their digital assets, but won't participate in cryptocurrency trading. Of course, nothing will protect those digital assets when the cryptocurrency bubble eventually bursts.

A coin with a B on the face, against a background of a chart.

Image source: Getty Images.

This is far from the first instance of blockchain-related news driving big gains in the past few months. Shares of Eastman Kodak , Seven Stars Cloud Group , and Cogint Inc.all surged on Wednesday thanks to separate announcements. In the case of Cheetah Mobile, all it took was an unconfirmed foreign-language report that mentioned blockchain for speculators to pile into the stock.

The surge on Thursday brings Cheetah Mobile's shares to their highest level since early 2016.

Now what

Warren Buffett warned on Wednesday that the mania surrounding cryptocurrencies will come to a bad ending "almost with certainty." We've reached a point where even unconfirmed rumors about blockchain can push a stock much higher.

There are legitimate reasons to be interested in Cheetah Mobile as an investment. An unconfirmed report about blockchain is not one of them.

Bitcoin is overhyped: 10 better buys for you now

When investing geniuses David and Tom Gardner have a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*

David and Tom just revealed what they believe are the ten best stocks for investors to buy right now... and investing directly in Bitcoin was noticeably absent from their recommendations! That's right -- they think these 10 stocks are better buys.

Learn more

{% render_component 'sa-returns-as-of' type='rg'%}

Timothy Green has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

In This Story

CMCM

Other Topics

Stocks

Latest Personal Finance Videos

How Student Loan Refinancing Works

Though it may be a great way to lower monthly payments, not everyone understands the student loan refinancing process. NerdWallet explains it. For more, try our refinance calculator: http://bit.ly/nerdwallet-student-loan-refinancing-calculator

Nov 25, 2019

The Motley Fool

Founded in 1993 in Alexandria, VA., by brothers David and Tom Gardner, The Motley Fool is a multimedia financial-services company dedicated to building the world's greatest investment community. Reaching millions of people each month through its website, books, newspaper column, radio show, television appearances, and subscription newsletter services, The Motley Fool champions shareholder values and advocates tirelessly for the individual investor. The company's name was taken from Shakespeare, whose wise fools both instructed and amused, and could speak the truth to the king -- without getting their heads lopped off.

Learn More