One early morning mover that stands out is little-known Exela Technologies (NASDAQ:XELA), a business process automation producer with global reach. This company made headlines yesterday when it announced a partnership with healthcare nonprofit CareSource, and shares of XELA stock have been rallying all morning.
What’s Happening With XELA Stock
Currently trading at just under $2 per share, XELA is still a penny stock. The type of gains we’ve seen from it recently though suggest that it may be on its way to passing that milestone. Despite a slight decline from its initial spike, XELA stock is still up more than 6% since trading began after rising almost 10% in pre-market trading. These gains have helped it rise almost 25% for the past five days.
This isn’t the only spike we’ve seen from it this month. One week ago, shares shot up by more than 51%. Although they were quick to fall again, the stock is currently in the green by more than 3% for the month as the company heads into November.
What It Means
It’s not hard to see why an organization like CareSource would want to partner with a company like Exela. For anyone operating in the nonprofit space, particularly in a field like healthcare, automated business process is likely key to ensuring efficiency in day-to-day operations.
There is plenty to suggest that Exela stands to benefit significantly from the partnership, though. CareSource’s operations include working with a vast network of healthcare providers as well as 2 million members. This partnership will ensure that Exela is able to provide its technical solutions and products to them all.
Dayton, Ohio, the city in which CareSource is based, is also pleased with the partnership. The Dayton Daily News reports that Governor Mike DeWine expects the partnership to bring many new jobs, calling it a “big win” for the city. In addition, the partnership allows Exela to establish itself in Dayton’s up-and-coming industrial market.
InvestorPlace contributor Thomas Niel noted XELA stock’s potential earlier this month. Since then, it has only increased.
Why It Matters
Exela brings with it over 4,000 customers, including the popular Cleveland Clinic nonprofit medical center. As the company has experience helping clients in the space, it is well positioned to scale operations and assist CareSource. Not only will this partnership expose the tech company to a new client base, it will allow it to secure a market share in a growing field.
Still a fairly new company, Exela was only founded in 2017. When we consider that, the type of growth it is achieving as a publicly traded company is noteworthy. Partnerships in the nonprofit sector don’t always excite investors, but in this case, it should absolutely be seen a positive development. This deal has the potential to help XELA stock rise even more as the partnership develops and CareSource’s network expands.
If you’re watching penny stocks, XELA is worth keeping an eye on.
On the date of publication, Samuel O’Brient did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.