SMJ International Holdings (SMJF) shares took another hit Thursday after the company issued a statement addressing what it called "unusual market activity." The flooring products distributor confirmed it's investigating irregular trading patterns observed on February 17, 2026, but so far the inquiry hasn't turned up any undisclosed news or developments that would explain the movement. Translation: the company has no idea why the stock is doing what it's doing, but wanted investors to know there's no secret bombshell lurking.

Here's where things get interesting. Short interest data shows a dramatic shift in sentiment. In the most recent reporting period, short positions plummeted from 215,350 shares down to just 80,260 shares—that's 2.97% of the float. The short ratio sits at one day, meaning any remaining short sellers could cover their positions in a flash. This substantially limits the potential for a short squeeze, even if buying pressure materializes.

For context, SMJ went public on NYSE American back on December 4, 2025, raising $10.82 million at $4 per share. Newly minted small-cap stocks often attract early short-seller attention as traders test the waters, so seeing short interest drop off might actually be a constructive development as the company works through its trading review.

Technical Picture Points to Severe Weakness

The charts aren't pretty. SMJ International is currently trading 70.5% below its 20-day simple moving average and 70% below its 50-day SMA—textbook signs of technical distress. Year-to-date performance shows shares down 71.41%, with the stock sitting much closer to its 52-week lows than highs.

The Relative Strength Index stands at 13.70, firmly in oversold territory. That could signal a potential bounce if buyers decide to step in, but there's a catch. The MACD indicator sits at -0.4236, well below its signal line of -0.0323, which screams bearish momentum. So you've got an oversold stock that's still trending downward—a mixed signal that suggests caution even for bargain hunters.

Technical traders are watching two key levels:

• Key Resistance: $4.50
• Key Support: $1.00

SMJ International specializes in selling and distributing flooring products across Asia, including carpet tiles, broadloom carpets, and vinyl tiles. The company operates under its proprietary "SMJ" brand and emphasizes environmentally friendly products that support sustainable building practices.

Valuation Metrics Raise Red Flags

Looking at the fundamental picture, SMJ scores just 6.01 on its Value Rank, indicating the stock appears weak relative to its peers from a valuation perspective. This low score suggests the company may be trading at a premium compared to similar businesses, which is unusual given the steep price decline.

The Bottom Line: SMJ International's technical and fundamental signals paint a picture of weakness. The low Value score combined with severe technical deterioration suggests investors should proceed cautiously, even with the stock in oversold territory.

Price Action: SMJ International shares were down 7.47% at $1.42 at the time of publication Thursday.