Shares of Meta Materials (NASDAQ:MMAT) are up more than 20% in the past five trading days after the company was awarded a $4.3 million purchase order for its nano-optic security business. The award has provided MMAT stock with a major boost.
The customer, an undisclosed G10 central bank, will provide Meta Materials with up to $41.5 million over the next five years, with the $4.3 million being an initial base award. Furthermore, the bank could increase its order amount if necessary. The services provided to the bank will include anti-counterfeit measures for currencies and government documents using Meta’s KolourOptik technology.
CEO George Palikaras added:
“META is committed to being a global leader in banknote security technology. Our nano-optic technology addresses a growing, multi-billion-dollar problem by delivering next generation solutions that can be applied to protect banknotes and government documents and provide authentication for brands.”
The award amount was higher than total second-quarter revenue of $3.32 million, up 423% year-over-year (YOY). Still, the company remains unprofitable, reporting an earnings per share, or EPS, loss of seven cents during the quarter, equal to a net loss of $20.98 million. That loss was much higher when compared to the loss of $5.88 million a year ago. The increased losses have contributed to MMAT’s year-to-date decline of more than 65%. Much of these losses are attributed to the goal of doubling production capacity.
However, the order represents a clear demand for Meta Materials’ proprietary technology. During Q2, its intellectual property portfolio grew by 3x. Further orders for the materials company will help strengthen the investment thesis behind MMAT.
5 Investors Betting Big on MMAT Stock
Tracking institutional ownership is important, as these large investors provide liquidity and support for stocks. During Q2, 98 funds reported owning MMAT, a decline of 11 funds from the previous quarter. Meanwhile, the institutional put/call ratio sits at a low 0.29, down from 0.54 during Q1. This means institutions own more call options against the company than put options by a wide margin. Let’s take a look at Meta Materials’ five largest shareholders:
- Thomas Welch, 10% owner: 46.84 million shares. Welch’s position is accurate as of Q2 of 2021.
- George Palikaras, President and CEO: 32.43 million shares. Palikaras’ position is accurate as of Q2 of 2021.
- Greg McCabe: 19.6 million shares. McCabe’s position is accurate as of Q2 of 2021.
- State Street (NYSE:STT): 12.82 million shares. State Street sold 11.3 million shares during Q2.
- Millennium Management: 5.49 million shares. Millennium purchased 5.46 million shares during Q2.
These five investors are likely betting on Meta’s impact in the electric vehicle (EV) industry as well, which is the company’s fastest growing market. The company’s NPORE and PLASMAfusion technologies seek to make rechargeable lithium-ion batteries more safe and efficient for customers by improving separators and current collectors. Meta Materials also develops transparent heating and electromagnetic interference (EMI) shielding for EVs.
On the date of publication, Eddie Pan did not hold (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.