The Next NVDA-Backed Runner and New Asian IPO Squeeze Play

We have seen stocks like Super Micro Computer, Inc. (SMCI) and SoundHound AI, Inc. (SOUN) have incredible squeeze runs thanks to their connection to NVIDIA Corporation (NVDA). We think the next one will be Spire Global, Inc. (SPIR), which popped a week ago after it announced a collaboration with NVDA to enhance AI-driven weather prediction. A few day later it dropped on the announcement of a financing at $14, with the potential to raise $61 million if warrants at $14.50 are exercised. We think there is a good chance that NVDA got in on this financing, as it tends to invest in the companies it does these deals with when spreading AI across different sectors. One such recent example was with Recursion Pharmaceuticals, Inc. (RXRX) for AI in drug development. 

It looks like SPIR didn't really need this financing as it has enough cash and looks like it will be cash flow and net income positive in 2024. This financing was of a strategic nature, not something led by brokers to fund a company's operations. The pullback presented a reprieve for shorts as the stock had skyrocketed from a little over $3 to nearly $20 in less than six months. The financing closed this evening, which should provide the spark for the stock to head at least to the $14 level where it took place over the coming few days. Pay close attention to NVDA's next 13F filing. SPIR may be there.

The second stock to keep an eye on is Linkage Global Inc (LGCB). This is a recent Asian IPO back in December that has similar characteristics to other Asian IPO runners like MicroAlgo Inc. (MLGO), MicroCloud Hologram Inc. (HOLO), AMTD Digital Inc. (HKD), Solowin Holdings (SWIN) and GigaCloud Technology Inc. (GCT) along with numerous others. What sets this one out from many of those others is that LGCB is actually profitable. So it's unlikely to dilute and prematurely kill any rally. 

The bookrunner for LGCB's IPO was EF Hutton, the same bookrunner for many of the Asian IPO squeeze plays. LGCB rose 46% on Monday, most of that being in the last two hours of the trading day. It rose that much on only 180,000 in volume. So you can imagine how much it can run if it achieved millions of volume like similar stocks have. Even with the run, it closed at $3.25 which is below the IPO price. It has 21.5 million shares outstanding and 6.7 million in the float. Finally,  it doesn't have the heavy volume pump and dump history like other stocks, so it's under the radar and won't have the resistance levels that they do. This is a "virgin" opportunity, and those are the types of stocks that have the best potential for massive runs. 




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