Why Chapmans Ltd Share Price Jumped Higher Today

Chapmans share price

What happened to the Chapmans Ltd share price?

At the time of writing, shares of Chapmans Limited [ASX:CHP] are up by 14.29%, to 0.8 cents, in today’s trading.

Why did Chapmans Ltd shares do this?

Last week, Chapmans raised AU$4.552 million, comprising of AU$1.59 million in equity and AU$2.962 million in unsecured convertible loans due at 30 June. Chapmans used the funding to acquire a 19.99% stake in GPU.One. GPU.One is a profitable data processing and cryptocurrency company focused on mining leading cryptocurrencies including bitcoin, ethereum, and Litecoin.

What now for Chapmans Ltd?

The acquisition provides significant share price upside potential. Take a look at the diagram below:

Chapmans share price

Source: Chapmans

GPU.One is currently producing revenue of US$365,000 per month — a number that should increase to US$4,000,000 per month (circa June 2018), once the project is scaled up. Bitcoin hit US$9,000 this morning — a four-week high. Assuming cryptocurrencies continue to surge in the weeks ahead, Chapmans share price could rocket higher.

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That said, should the crypto market crash — the worst case scenario — the GPU facilities can be converted to a data processing/storage centre, with potential revenues of US$7 million-plus per month. The company is also in the process of acquiring other blockchain investments, worth roughly $11 million.

Chapmans market capitalisation is trading at $11 million at 0.8 cents per share, with plenty of cash in the bank.

Jason Stevenson,
Resources Analyst,

Money Morning

Jason Stevenson

Jason Stevenson

Jason Stevenson is Money Morning’s resource analyst. He believes the best way to make money lies in the resources sector.

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