Analysis Report on the Strong Performance of Kersen Technology (603626)

Kersen Technology (603626) has recently shown strong stock price performance, with consecutive daily limit-ups and a new 52-week high, posting significant gains from October 2025 to the present. Analysis indicates that the stock’s strength is mainly driven by technical momentum; since entering an uptrend channel in October 2025, its YTD gain has reached 155.63%, and its 6-month gain exceeds 131% [0]. Meanwhile, against the backdrop of a general recovery in A-shares and rising investor risk appetite, speculative buying in small-cap stocks has been active, further pushing up the stock price [0].
From the perspective of price and trading volume: Over the past 10 trading days, the stock price has risen from $14.11 to $19.53, an increase of 38.4%; today’s limit-up price of $19.53 is a 52-week high, with trading volume reaching 93.2 million shares, far exceeding the average volume of 55.12 million shares, indicating strong buying interest [0]. Technically, it is in an uptrend, but the KDJ (K:94.0, D:88.4, J:105.2) and RSI indicators show overbought conditions [0].
Fundamentally, the company’s financial condition is weak, with losses for multiple consecutive quarters, a net profit margin of -11.15%, and insufficient liquidity (current ratio 0.8, quick ratio 0.62) [0]; in terms of valuation, the P/B ratio is 5.05 times, far higher than the industry average, indicating overvaluation [0]. No clear positive catalysts at the company or industry level have been identified; the current gain is mainly driven by momentum.

1. Momentum Investment Driven
   : In the absence of fundamental support, the stock price rise relies mainly on technical momentum and market speculative sentiment, making it a typical momentum investment target.
2. Valuation-Fundamental Divergence
   : Despite the continuous rise in stock price, the company’s financial losses and overvaluation indicate a strong element of market speculation.
3. Correction Risk Looming
   : Technical indicators are overbought, and trading volume has surged to high levels, leading to significant short-term correction pressure.

• Technical Overbought Risk: KDJ and RSI indicators show overbought conditions, with a high possibility of short-term correction [0];
• Overvaluation Risk: P/B ratio is far higher than the industry average, with significant risk of valuation bubble [0];
• Fundamental Deterioration Risk: Continuous losses and insufficient liquidity; if performance does not improve, the stock price lacks long-term support [0];
• Lack of Catalyst Risk: No clear positive support; the sustainability of the rise is questionable.

• Short-term Momentum Continuation: If market sentiment remains optimistic, the stock price may briefly touch the target level of $20.60 [0];
• Industry Recovery Potential: If the metal processing sector recovers overall, it may bring indirect benefits to the company.

Kersen Technology (603626) recent strong performance is mainly driven by technical momentum and speculative buying, with no clear fundamental catalysts. Technically, it is in an overbought state, with short-term correction risk; fundamentals are weak and valuation is high, leading to insufficient long-term support. Investors should pay attention to the company’s financial improvement and industry dynamics, and be alert to volatility risks caused by market speculation.