Everspin Technologies Inc (MRAM) has been in a sharp uptrend since late April, when it posted a massive Q1 earnings beat and announced a $40 million agreement with a US prime contractor.
Yet, the company’s share price ripped higher – as much as 50% – on Monday morning.
For novice investors, the price action may be a head scratcher, given that Everspin didn’t make any new announcement on May 11.
But a look under the hood suggests it’s still fair for MRAM stock to be that much today.
Lagged institutional effect is driving MRAM higher
While retail investors often react instantly, institutional buyers (funds and ETFs) typically wait for analyst updates.
Following the contract news and the significant Q1 earnings beat on April 29, several firms (like Needham) raised their price targets significantly.
Everspin shares are seeing the result of that “big money” accumulation hitting the tape today.
Everspin stock gains on a fresh Navy deal mention
Some market reports this morning specifically highlighted the subcontract’s link to US Navy programs (part of the Department of War’s Microelectronics RDT&E program).
While technically part of the April 30 announcement, the “Navy” specifics gained traction on May 11, sparking a fresh wave of buying interest.
Technical blue skies trigger algorithmic buying
MRAM shares have soared past strong resistance levels coinciding with the key moving averages (MAs) in recent sessions.
This often triggers “algorithmic buying,” where computer programs start to automatically load up on a stock, pushing its price up further in consecutive sessions.
MRAM is gaining in sympathy with Micron and Intel
Everspin stock is ripping higher in tandem with the broader sector rally as well.
Both Micron and Intel are up by double-digit percentages this morning due to separate AI-related news.
And because MRAM is increasingly viewed as an AI infrastructure play, it is being pulled upward by the rising tide of the entire semiconductor sector.
Where options data suggests MRAM shares are headed
Despite a meteoric run in MRAM stock in recent weeks, options traders continue to believe it will gain further as the year unfolds.
According to Barchart, the put-to-call ratio on contracts expiring mid-September sits at 0.14, signaling a strong bullish skew, with the upper price at nearly $50, indicating potential for another 25% rally from here.
Meanwhile, seasonal trends favour owning Everspin shares as well.
Historically, the company has closed not just May, but June and July as well in “green” – which makes it even more attractive to own in the near-term.
As a trader put it on Stocktwits today: “MRAM, similar sector but much lower market cap – less than $1 billion – as MU and SNDK starting to move. Should perform a similar pattern as MU SNDK and go parabolic given market value and locked up low float.”
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