It was an incredible day for ChinaCache International Holdings Ltd. (NASDAQ:CCIH), which saw near to a 200% increase in its stock. Trading closed today at $3.05, which put it $2.02 over yesterday’s close of $1.04.
ChinaCache provides Internet content and application services throughout China, hosting websites and web-based application for Chinese organizations.
This climb is a rarity for ChinaCache as of late, as for the past year the company’s stock has declined 87.12% since December 19, 2016. The decline in stock price can be linked with a number of different factors, including the company’s issues with its NASDAQ filing. In May, the company received notice that it no longer met the period filing requirement for The Nasdaq Stock Market under the Rule. For several months, ChinaCache was dealing with sorting its filings out so that they complied with Nasdaq again. On November 21, 2017, it was announced that its filings from its November Annual Report were accepted by Nasdaq as complying with its Rule. ChinaCache is now in recovery from that, with its stock starting to now indicate this.
In June, the company was also awarded a CDN license in China. A CDN, or Content Delivery Network, provides users with a cached version of a web page when they visit a site so that the data reaches the user much faster than it would have otherwise. CDNs are quite common, and most web pages are viewed through them. For ChinaCache to get a license is a big deal, because it gives the company an advantage over all the other CDN companies that are operating without a license (of which there are plenty, especially in China). Even more importantly, China has stated that it plans to shut down all companies operating without a CDN license by the beginning of the new year, so obtaining this license is definitely what will keep ChinaCache alive over the course of the next few months.
While it has been a slow time coming, being granted a CDN license is also no doubt playing its part in boosting ChinaCache’s stock currently. I wouldn’t be surprised to see another huge stock jump come January when China does shut down all the non-licensed operators, leaving behind only a few companies that can continue operating, ChinaCache included. I’m going to check in on the stock again in January, to see what effect China’s pull will have on ChinaCache.
Featured Image: twitter
