The recent artificial intelligence-driven boom has brought unprecedented gains to semiconductor industry stocks and subsidiaries. However, the story of Beamr Imaging (NASDAQ: BMR) stock might be the most interesting yet.
Beamr Imaging specializes in delivering video encoding, transcoding, and optimization technology solutions. The company’s clientele comprises leading video streaming platforms and Hollywood studios, and as of recently, Nvidia (NASDAQ: NVDA) has also taken place on this list.
Beamr initiated its public offering on March 2, 2023, at an initial share price of approximately $4, valuing the company at $55 million and raising $8 million. However, by December of the same year, its shares had declined to around $1.16, representing a decrease of approximately 66% from the IPO price.
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But now its shares are valued at $9.95 each after a surge of 370% in value.
How is Nvidia responsible for the BMR stock surge?
On February 12, Beamr witnessed an exceptional share surge, soaring by 370% after Nvidia announced a new product incorporating Beamr’s video technology—a video conversion solution. NVDA introduced the NVENC Video Codec SDK 12.1, integrating Beamr’s CABR technology.
As previously disclosed, Beamr is slated to debut its new video cloud service on February 20, 2024, hosted on Amazon’s (NASDAQ: AMZN) AWS platform and powered by Nvidia. This service aims to revolutionize video processing, making it accessible and cost-effective for many users.
A worrying sign for the industry?
The mere mention of a partnership with Nvidia and the exaggerated market reaction indicates a potential instance of rapid inflation in a microcap stock. This occurrence evokes comparisons to the dot-com bubble of 1995-1999, during which technology company valuations surged amid the advent of the internet.
Beamr Imaging saw its market capitalization soar from about $34 million on February 8 to roughly $214 million by February 12, all in a single trading session following its partnership announcement with Nvidia.
Such pronounced market responses reflect strong positive sentiment towards the partnership news yet may also bring volatility and price corrections as initial excitement wanes.
Looking at the pre-market gains, BMR stock has gained an additional 47.74% to its value, putting it at $14.70 at the time of writing. Due to a small trading sample of this stock, it is hard to predict whether it can continue with gains in the future.
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