Popular meme stocks are falling today, but a few companies are still rising steadily. One company that has surged this week and remains in the green is Aerwins Technologies (NASDAQ:AWIN), an aerospace technology producer based in Japan. This company doesn’t often make headlines, but today, it has surged more than 160% in just a few hours. When a mostly unknown company sees that type of growth, it’s easy to blame meme stock momentum. And given the high short interest in AWIN stock, it’s not hard to see what’s going on. AWIN stock may be the market’s next short-squeeze candidate.
Does this mean that investors should pile into AWIN before it surges even higher? Given the fragile nature of the current rally, it’s difficult to say. But given how much the stock has risen in only a few hours of trading, it is definitely worth a closer look.
Is an AWIN Stock Short Squeeze Brewing?
A quick look at short interest data from Fintel reveals why an AWIN short squeeze may be unfolding. Short interest accounts for more than 20% of the float, which is likely what is pushing AWIN stock up so much. On top of that, as of this writing, there are currently no shares available to short at Fintel’s leading prime brokerage. That’s down from just 1,000 six hours ago. While the stock doesn’t rank among the highest short squeeze scores on the platform’s leaderboard, it is clear that short interest is high.
While Aerwins is still up 160% for the day, momentum appears to be running out. That’s to be expected when a little-known stock surges by so much with no company-specific catalysts. However, it suggests that the AWIN stock short squeeze could already be ending, marking a brief but impressive run.
It’s also worth noting that AWIN certainly fits the criteria of a meme stock. The company is heavily shorted and has struggled considerably throughout the past year. Over the past six months, it has lost 50% of its value, even with today’s surge. In addition, it received a delisting notice from Nasdaq on Oct. 18, 2023. This news sent AWIN stock up, but it couldn’t keep it in the green for long, another common trait among meme stocks.
Now, the recent loss of momentum suggests that even with the high short interest in Aerwins, the stock is destined to come back down as momentum shifts. Buying AWIN stock likely won’t be a win for investors in the long run.
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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.
