SEI takes new $687K stake in vape maker RLX as earnings miss
What's the deal? Sei Investments Co.Dealroom has a profile for this one. Try Dealroom → acquired a new stake in RLX Technology Inc. Sponsored ADRDealroom has a profile for this one. Try Dealroom → (NYSE:RLX) during the first quarter, buying 312,471 shares worth roughly $687,000, according to HoldingsChannel.com.
What does RLX do? The China-based company develops, manufactures, and markets closed-pod vaping devices and prefilled cartridges. It positions its electronic nicotine delivery systems as an alternative to combustible tobacco.
The numbers: RLX reported earnings on August 14, posting $0.03 earnings per share and missing the $0.09 consensus by $0.06. Revenue came in at $148.73 million, well short of the $173.99 million analysts expected.
The stock opened at $1.96 on Friday, giving RLX a market cap of $3.03 billion and a price-to-earnings ratio of 19.55. Shares have traded between a one-year low of $1.76 and a high of $2.84.
What's the read? Despite the revenue miss, RLX held a return on equity of 6.15% and a net margin of 20.76%. Weiss RatingsDealroom has a profile for this one. Try Dealroom → reiterated a "hold" rating on July 17, and the stock carries an average target price of $2.50.
Who else is buying? Institutional interest has been active. Canada Pension Plan Investment BoardDealroom has a profile for this one. Try Dealroom → lifted its stake 53.7% in the second quarter to 3,804,284 shares worth $8,407,000, while JPMorgan Chase & Co.Dealroom has a profile for this one. Try Dealroom → boosted its holding by 11,091.5% in the third quarter to 808,589 shares. Institutional investors and hedge funds now own 22.68% of the stock.
The signal: SEI's entry adds to a wave of institutional buying in RLX, even as the company's latest quarter fell short on both earnings and revenue. The gap between rising fund interest and a soft results print underscores the uncertainty around China's tightly regulated vaping market.
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Image credit: Vaping360
