Software company Nukkleus (NUKK) is expanding its operations after gaining a majority 51% stake in defense company Star 26 Capital. That’s a big deal for NUKK as Star 26 Capital owns Rimon, the supplier of critical components for Israel’s Iron Dome missile defense system.
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Nukkleus paid a mix of cash and stock for its stake in Star 26 Capital. That includes a promissory note for shares of NUKK stock and warrants to acquire additional shares. The total value of this purchase came to $26 million with Star 26 Capital including an option for Nukkleus to acquire its remaining equity at a later date.
Nukkleus CEO Manny Shalom notes that this purchase is part of Nukkleus’ plan to switch from a software company to a defense company. She said NUKK will “capitalize on opportunities in the defense sector, which has seen rapid growth due to geopolitical shifts in the Middle East and the war in Ukraine.”
How This Affects NUKK Stock Today
Nukkleus shares are rocketing higher alongside today’s acquisition news, with shares of NUKK stock rising 947.48% as of this writing. However, the company’s shares are still down 29.52% year-to-date.
A major factor behind NUKK stock’s rise is increased trading activity. As of this writing, more than 136 million shares of Nukkleus stock have changed hands. That’s an incredible surge over its three-month daily average trading volume of 586,290 shares.
While NUKK stock is trading for around $14.56, the shares closed yesterday at $1.39, putting it in penny stock territory. This means today’s rally might not last, with the stock retreating once the hype around the Star 26 Capital stake begins to fade.
Is NUKK Stock a Buy, Sell, or Hold?
There isn’t enough analyst coverage to give a consensus answer to this question. Instead, let’s look at the technical analysis TipRanks offers. The overall consensus is Sell with 14 Sell, two Neutral, and six Bullish indicators. The technical analysis consensus is Buy while the moving average consensus is Strong Sell.
