Price Forecast:

Bullish Case: If Akoustis successfully resolves its legal issues and secures new high-demand orders, AKTS could experience a strong rebound given its currently low price and historical upside potential, reflected in the return surface.

Bearish Case: Continued legal and financial struggles may lead AKTS closer to bankruptcy, impacting investor sentiment negatively. The return surface indicates significant risks for long-term investors, with low probabilities of positive returns beyond one year.

Potential Outcomes:

• Bankruptcy (50%) due to unresolved financial distress.
• Order recovery leading to earnings improvement (25%).
• Continued price drop amidst negative sentiment (25%).

Trading Oracle: Consider a bullish debit spread by buying AKTS 0.50 Calls and selling 1.00 Calls for January expiration. The high implied volatility suggests potential rapid moves; this strategy leverages historical mean reversion while minimizing risk. Given the bullish scenario's likelihood, this could yield solid returns if AKTS stabilizes or improves.

December 11, 2024