Unique Fabricating (NYSE: UFAB) stock is up 62%. Again. For this is the third - just by our count - time UFAB stock has had a little run this year. It's easy enough to see why too. It's a fairly large operation with a low capitalisation - because it's near bust. But it's also has support from three major car companies simply because it is a supplier to them. It's one of those companies where we do expect there to be a solution at some point. That support from the three major car companies is what leads to that idea, if they want there to be a solution badly enough then there will be a solution.
We've talked about Unique Fab before: “That is, the danger to the business is not what the NYSE or SEC might do, it's what the company bankers might. And they're much less forgiving of whatever this accounting difficulty is. We read that - and yes, we know it is in part at least just boilerplate - as being that the explanations of that November little bookkeeping problem haven't left the banks happy, Given that the company depends upon credits from banks, well, that's a problem. And most certainly we can't understand why a company that has just admitted that its continued survival depends upon the goodwill of its bankers should see its stock price jump 141%. We think that might be an error by market opinion there.” And yes, the stock did near immediately drop back to its former levels.
Unique Fabricating stock price from Google Finance
The thing is, this also happened again in May, after that April little spurt. Again us on UFAB stock: “Unique Fabricating (NYSE: UFAB) stock is up 91% this morning premarket. It has to be said that there's no apparent reason for this even as trade in the UFAB stock is several hundred - yes, several hundred - times normal. Perhaps the most obvious and pertinent observation is that this all happened about three weeks back as well. Unique jumped for not even a full day then settled back down again. Which means - not certainly, not at all, but this is perhaps the way to bet - that the same will happen this time.” To avoid narrative uncertainty, yes it did.
Now it is possible that there's going to be some news. UFAB might file its accounts. There might be a rescue deal. All sorts of exciting things could happen. But at this point we'd suggest that it's just the same old Hey, let's have a bet on Unique stock today, shall we?