Following the rally on Monday, shares of YRC Worldwide Inc. (NASDAQ: YRCW) nearly 16% plunged in today’s trading. The penny stock touched a low of $0.34 in mid-day trading, closing at $0.31 on volume of 122.6 million.
The penny stock has since a huge rally over the past couple of weeks, and today’s decline is most likely pinned to profit booking by investors. Investors can expect another rally after today’s correction as YRC Worldwide gets close to the announcement of its second-quarter financial results, which the company will report on August 3, 2010.
The penny stock is currently trading above its 10, 20 and 50 day moving averages, which is a bullish signal. The stock has a 52-week range of $0.10-$6.18.
The penny stock is facing some resistance at $0.43. The other resistance levels for the stock are at $0.49 and $0.56. The penny stock has strong support at $0.25 so we can expect a rebound from this level, if the stock sees a further decline.
The penny stock will continue to remain in focus as YRC Worldwide prepares to report its second-quarter financial results.
YRC Worldwide has already provided an update on its second quarter performance. The company is expecting to report a positive adjusted EBITDA, for the second quarter of 2010. It is anticipating adjusted EBITDA to come in between $35 million and $45 million, excluding the YRC Logistics segment, which the company sold to Austin Ventures, a strategic private equity firm, for $37 million during the second quarter. The results of YRC Logistics will be reported as discontinued operations.
The company’s positive outlook for the second quarter and its improving operating metrics are primarily the reason behind the rally seen in the penny stock in the past couple of weeks.
Analysts, meanwhile, are expecting the company to report a loss per share of $0.09 on revenue of $1.2 billion, for the second quarter of 2010. For the full year, analysts expect the company to report loss per share $0.54, compared with a loss per share of $3.53 reported by the company for the same period last year.
YRC Worldwide, through its subsidiaries, offers a range of transportation services. The company offers its services at regional, national and global level. The company is based in Overland Park, Kansas.
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