Beamr Imaging (NASDAQ:BMR) stock gained more than 1,000% at one point yesterday and finally finished the day 371% higher. This rise came after the company announced a partnership with Nvidia (NASDAQ:NVDA).
On top of that, yesterday afternoon, the company also announced a $12 million offering of BMR stock. As part of the offering, the company will sell about 1.71 million shares at $7 apiece.
Nevertheless, shares of Beamr Imaging are advancing another 65% in early trading today.
Beamr Imaging’s Collaboration With Nvidia
A video encoding, transcoding and optimization solutions company, Beamr Imaging will work with Nvidia to advance a video format called AOMedia Video 1 (AV1). As InvestorPlace contributor William White reports, this format is intended to replace the current format in use, which was “established before smartphones and high-speed internet.”
Under the deal, Beamr and NVDA will create an automatic means of converting videos to the AV1 format. As a result of the collaboration, Beamr Imaging stands to remain a key player in AV1 for the foreseeable future.
The Price Action and Valuation of BMR Stock
As of this writing, BMR stock has soared 900% in the past one month and 1,100% in the previous three months. The company first went public back in late February 2023.
Shares of this company now have a gigantic trailing price-to-sales (P/S) ratio of 44 times, as shown by Yahoo Finance. In 2022, the firm generated just $2.9 million of revenue and reported a net loss of $1.2 million.
Why Companies Sell Stock After Shares Soar
Firms sometimes sell stock after their shares soar because doing so allows them to unload their own equity at high prices. As a result, they obtain relatively large amounts of funds that can then be used to bankroll operations, hire more employees or acquire other firms in order to boost the top and bottom line.
On the date of publication, Larry Ramer 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.
