Sometimes the best signal a CEO can send is putting their own money where their mouth is. That's exactly what happened with Cheetah Net Supply Chain Service Inc. (CTNT) on Wednesday, when shares jumped 17.74% in after-hours trading after a regulatory filing revealed that CEO, Interim CFO, and Chairman Huan Liu bought 200,000 shares of Class B common stock through a private placement.
Liu paid $2.00 per share for the lot, a total of $400,000. That's notable because the stock closed the regular session at $1.58, down 1.55% on the day. Buying shares above the market price is generally seen as a strong vote of confidence — it says the insider thinks the stock is worth more than what the market is currently offering.
According to a separate SEC filing, the purchase lifted Liu's aggregate beneficial ownership to 203,456 shares, representing a 6.4% stake based on 2.95 million Class A shares outstanding. Liu stated he acquired the shares for investment purposes and has no plans for mergers, asset sales, or board changes.
The timing is interesting. Cheetah Net just reported its most recent quarter in May, posting a loss per share of $4.53 — which actually beat the estimate of a $10.00 loss by 54.7%. But revenue came in at $92,700, missing the $200,000 estimate by 53.6%. So the company is still burning cash, but the loss wasn't as bad as feared.
Earlier this month, Cheetah Net completed the acquisition of Super International Trading Limited, a Hong Kong-based large-scale industrial equipment trading firm. That move could help diversify the company's business beyond its core logistics and warehousing services.
It's been a rough ride for shareholders. The stock underwent a 1-for-200 reverse stock split on April 20, and over the past 12 months, CTNT has dropped a staggering 99.37%. The 52-week high was $424 (pre-split adjusted), while the low is $1.48. Currently, the stock trades near that low, with a market capitalization of just $4.69 million.
Technical indicators aren't pretty either. The Relative Strength Index (RSI) stands at 21.56, which is deep in oversold territory. That can sometimes attract bargain hunters, but it also reflects persistent selling pressure. Market data indicates that CTNT has a negative price trend across all time frames.
So what's the takeaway? A CEO buying shares above market price is a positive signal, but it's one data point in a sea of challenges. The company is small, unprofitable, and its stock has been crushed. Investors will be watching to see if Liu's confidence translates into better operating results in the coming quarters.
