Newborn Town Inc. showed a decent recovery in recent days, supported by fundamental factors like the share buyback program. Also, the company has a history of decent earnings, providing over 100% gain in a year.
Newborn Town Key Strengths
The market valuation of Newborn Town Inc. is HK$4.73 billion, and it has significant streams of income generated by its Innovative Business (CN¥406.28 million) and Social Networking Business (CN¥3.80 billion).
The company makes a strong argument in the penny stock space. The business exhibits sound financial standing since its short-term resources easily cover its long-term obligation, and its cash balance exceeds its total debt. It has maintained an excellent return on capital at 37.6% while its profits have increased by 137.3% throughout the last year, outpacing both industry standards and the company's five-year growth record of 44.2% yearly.
Newborn Town Share Buyback Outlook
According to a Friday market filing, Three D Partners, the trustee of Newborn Town 9911, purchased 11,720,000 shares between January 6 and January 10 for about HK$39.9 million through the business's limited share unit reward program.
The shares were bought back from the marketplace for about HK$3.41 each, which amounts to 0.83% of the business's current authorized share capital.
Three D Partners now owns 83,920,069 shares of the internet advertising company after the recent purchase.
Previously, the trustee bought 67,512,000 stocks of the firm from the market during April 28, 2023, and January 3, 2025.
Newborn Town Stock (9911.HK) Technical Analysis
In the daily chart of Newborn Town, the ongoing bullish pressure is potent as the recent price showed multiple higher highs from left to right.
In the broader context, the bullish pressure is supported by the dynamic lines where the 200 day SMA is the major support. The 50 day EMA is also below the current price, suggesting a potential trend continuation from the Golden Cross formation.
In the volume structure, the most recent daily candle closed above the high volume line since September 2024. It signals a strong bullish reversal, which might result in a potential trend trading opportunity.
Based on this outlook, the upward continuation is potent as long as the price hovers above the 3.20 static support level. On the bullish side, the primary price to look at is the 4.79 swing high.
On the other hand, a failure to hold the price above the 3.40 level could be a challenging factor to bulls. An immediate bearish reversal with a daily candle below the 3.20 level might extend the selling pressure towards the 2.50 static level.
