Is a Short Squeeze Brewing in Meta Materials (MMAT) Stock?


  • Meta Materials (MMAT) stock carries a short interest as a percentage of float of 2.4%.
  • That’s equivalent to 7.65 million shares sold short worth $8.11 million.
  • MMAT stock is down more than 35% year-to-date (YTD).
A prototype of a nanostructured metamaterial in a lab setting.
Source: Shutterstock

Meta Materials (NASDAQ:MMAT) stock is up more than 30% today as talk of a short squeeze continues to grow.

Last week, the materials developer disclosed its third-quarter earnings, with revenue coming in at $2.45 million, up an impressive 329% year-over-year (YOY). That means that revenue for the nine months ended Sept. 30 totaled $8.75 million, up 388% YOY.

Still, this company remains unprofitable, reporting a net loss of $24.47 million for the quarter, or an EPS loss of 7 cents. That increased from a net loss of $11.42 million, equivalent to an EPS loss of 4 cents, in the prior-year period. As of the end of Q3, Meta Materials had no debt and cash and equivalents of about $32.2 million.

Will MMAT Stock Experience a Short Squeeze?

Now, investors are calling for a short squeeze with MMAT stock, although the statistics don’t exactly offer strong evidence. As of Oct. 31, short interest as a percentage of float was only 2.4%. That’s equal to 7.65 million shares short with a monetary value of $8.11 million. Furthermore, the shares sold short would only take one trading day to fully cover. With MMAT stock up so much today on no material news, its movement could be explained by shorts covering in a low short interest environment.

On top of that, a mixed shelf registration could further discourage the possibility of a significant short squeeze. On Nov. 9, Meta Materials filed for a mixed shelf worth up to $250 million. The shelf will consist of asset classes such as common stock, preferred stock, warrants and more. The company said that it would use the proceeds for “working capital and other general corporate purposes.” Meta Materials also added that it could use the proceeds toward acquiring “complementary products” or businesses. However, it currently has no plans to do so.

Still, shares of MMAT stock are up by about 90% for the past one month, driven by a memorandum of understanding (MOU) with DuPont Teijin Films and Mitsubishi Electric Europe. Through the agreement, Meta Materials will provide its PLASMAfusion technology to reduce reliance on copper in lithium-ion batteries. As a result, reduced battery weight will increase the energy density and range of the batteries. The MOU will last for several years, starting with “a pilot-scale roll-to-roll system.”

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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 Publishing Guidelines.

Eddie Pan specializes in institutional investments and insider activity. He writes for InvestorPlace’s Today’s Market team, which centers on the latest news involving popular stocks.

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