CANG Should I Buy
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Cango Inc. is not a strong buy at the moment for a beginner investor with a long-term strategy. Despite some positive developments in the Bitcoin mining and AI computing space, the technical indicators are bearish, and the stock is in a downtrend. It is better to wait for clearer signs of recovery or stability before considering an investment.
The technical indicators are bearish. The MACD is negative and expanding downward, the RSI indicates the stock is oversold, and the moving averages show a bearish alignment (SMA_200 > SMA_20 > SMA_5). The stock is trading near its key support level of 0.85, with resistance levels at 1.037 and above.
Cango Inc. has secured a $10.5 million investment and an additional $65 million investment agreement, which strengthens its financial position and supports its strategic development in Bitcoin mining and AI computing. Hedge funds are significantly increasing their holdings in the stock.
The stock has experienced a significant regular market decline of -9.35%, and technical indicators suggest a bearish trend. Analysts have recently lowered the price target from $8 to $3, reflecting market dynamics. The stock is expected to continue its downtrend in the short term, with a 70% chance of further declines over the next month.
In Q3 2025, the company reported a 291.83% YoY increase in net income and a 150% YoY increase in EPS, indicating strong profitability growth. However, revenue and gross margin remained flat YoY, showing no significant operational growth.
Analysts have a Buy rating on the stock, but price targets have been revised downward. Greenridge has a $4 price target, while H.C. Wainwright reduced its target to $3 from $8. Analysts believe the company is mispriced and overlooked but acknowledge market challenges.
