Date of inclusion: 8 December 2021
Share price on inclusion in Marc & Stuart’s Top Picks: $0.051
Date of exclusion: 28 April 2022
Share price on exclusion: $0.115
Performance since inclusion: 125%
Reason for exclusion: Strong resistance at 13 cents
4DS Memory is back on track
4DS Memory (ASX:4DS) recently announced it is back on track with the development of its ReRAM technology following major issues late in 2021. Consequently, the share price has had a good run in the last few months.
We included the stock in Marc & Stuart’s Top Picks at 5.1 cents back in December, but we are now running into major resistance at 13 cents. This is also the share price level just before 4DS announced its technical issues.
With a performance of 125% in less than 5 months, we feel it is now time to take profits.
Can 4DS run further?
We are not excluding the possibility that 4DS can go back up above 20 cents, where it was in August last year. However, in the near term, we are expecting an announcement from the company about the etching step of the production process. This is where things went wrong last year and the new batch of wafers currently being produced should be at this production step right about now.
A few weeks ago, 4DS said it would update the market about this etching step and we expect this announcement within the next week or two. Basically, the market is now pricing in that things will have gone well. In other words, if this is the case, there’s not a lot of upside in the share price in the very near term. However, if things haven’t gone well, we expect the share price will take another hit on the back of that news.
Next big update in mid-2022
Somewhat further out, we expect the next big technology update from 4DS to be announced some time in calender Q3, so at least 3 months from now.
So although there’s likely more upside to 4DS in the medium to longer term, with 135% performance in the bag, on 28 April 2022 we felt it was time to sell.