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Thursday, May 19, 2022

Guardforce AI Co., Ltd. (GFAI) Stock on Decline, Here’s the Cause

Guardforce AI Co., Ltd. (GFAI), a company known for offering cash solutions, has slid 7.38% in the premarket trading session. As a result, GFAI stock was trading at $1.13 when last checked. During Tuesday’s regular trading session, GFAI stock slumped by 8.27% to close the day at $1.22. The consistent decline could be attributed to the acquisition of Shenzhen Keweien & Guangzhou Kewei.

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Closure of Acquisition

On Tuesday, GFAI announced the closing of the acquisition of Guangzhou Kewei Robot Technology Co., Ltd and Shenzhen Keweien Robot Service Co., Ltd. The acquisition is done for the price of $10,000,000 which is paid in the form of cash as well as restricted ordinary shares of GFAI. Greater bay area based Shenzhen Keweien Guangzhou Kewei is focused on a varied sector like property management, hospitality, healthcare, etc.

Signing of LOI with Kewei Group

On 21st March, GFAI announced to have signed a non-binding Letter of Intent (LOI) with Shenzhen Kewei Robot Technology Co., Limited and Shenzhen Yeantec Co., Limited. The agreement dealt with the purchase of up to 36 subsidiaries of both the companies, collectively known as Kewei Group. Under LOI, the first phase would comprise of GFAI acquiring 8 companies of Kewei Group, while in the second phase, Guardforce would have the right of first refusal for the purchase of remaining companies.

When GFAI would Release FY 2021 Results?

On the 17th of March, GFAI announced its plan to release the financial results for the full year 2021 on the 30th of March 2022 after the closure of the market. The company also plans to host a conference call on the 31st of March 2022. The management of the company would discuss the corporate development of the fiscal year 2021 with the shareholders.

What’s Coming Up for GFAI?

Looking ahead, analysts are considering GFAI as a hold candidate. Even though several positive signals are associated with the stock at the moment, they are not enough for it to be considered a buy candidate. So, for the moment, investors should hold the stock while waiting for future developments.

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