Rekor Systems Inc [NASDAQ:REKR] has been gaining upside momentum over the last two months. The company’s momentum has seen a growing analyst consensus that the stock is a buy.
Today, the stock has sustained this momentum and is up by 24%. So what next for REKR? After such huge gains, is the stock up for a correction or is the bull rally likely to continue? To understand the possible direction of this stock, one needs to understand the reason behind the rally.
Why REKR is gaining
This stock has been on an uptrend since July when it was reported that the company was joining the NVIDIA Metropolis Software partner program.
The goal of the program is to apply deep learning techniques in live streams. Through the program, NVIDIA is looking to create a way for the creation of artificial intelligence cities. Rekor is now part of the over 100 NVIDIA city partners. Through this program. Rekor will leverage NVIDIA’s AI and GPU for its machine-learning enabled software.
At the time, Rekor’s Chief Science Officer Mathew Hill said that by working with NVIDIA, the company was taking advantage of the program to expand the software on the over 1 billion cameras that will be in the NVIDIA cities by the end of 2020. Through this partnership, the brand image of REKR has improved, and the company’s revenues stand to grow over time. As the NVIDIA cities come alive, the company’s stock stands to grow. This could see the stock keep gaining upside momentum in the near term.
Besides the NVIDIA program, this stock’s upside momentum is supported by the company’s strong finances. Earlier in the month, the company released its Q2 results and they point to a strong company. In Q2, the company reported that revenues grew by 89% to $2.7 million as compared to Q2 of 2019.
The company also announced that it entered into an agreement to exchange more than 77% of all its payable notes from 2019. This points to a company whose core fundamentals are, strong enough to support growth. In the near-term, this could see the stock value grow based on both investor confidence and the ability to quickly take advantage of emergent opportunities.
While announcing the results, the company CFO Eyal Hen stated that they would continue carrying out their strategic plan of focusing on technology to grow revenues.
About Rekor Systems Inc
Rekor Systems Inc is a vehicle identification and a management systems provider. It is based in Columbia, Maryland.