Ocean Power Technologies, Inc. (OPTT) stock prices surged by 13.2967% shortly after market trading commenced on July 2nd, 2021, bringing the price per share up to USD$2.7871, before having peaked at USD$3.0577 earlier in the trading day.
Inclusion in Russell Microcap Index
June 23rd 2021 saw the company announce its inclusion in the Russell Microcap Index, effective as of the market opening on June 28th 2021. The company’s inclusion in the Index signals its growth potential, with the move benefitting existing shareholders as well as leading to greater exposure to potential institutional investors. Membership in the Russell Microcap Index entails automatic inclusion in relevant growth and value style indexes; and is determined annually by objective, market cap ranking, and style attributes.
Revenue Reports
Revenue for the third quarter of fiscal 2021 was reported at USD$0.3 million, down from the USD$0.7 million reported for the same time period of the prior year. Net loss for the 2021 quarter was up USD$0.3 million from the net loss reported for Q3 2020. The first nine months of fiscal 2021 reported USD$0.6 million in revenue, as compared to the USD$1.1 million reported for the same time period of the prior year. These movements are largely attributable to the company’s revenue-generating projects experiencing pandemic-related delays.
Balance Sheet
The company reported USD$80.4 million in total cash, cash equivalents, and restricted cash as of January 31st, 2021. Net cash allocated towards operating activities was down by USD$0.1 million during the first nine months of fiscal 2021, reporting in at USD$8.5 million. The decrease is largely the result of lower cash spending on customer projects, as well as product development costs. The company generated net proceeds in the amount of USD$76.1 million with its ATM agreement and equity line agreements with Aspire Capital.
Meme Stock Phenomenon
Despite inclusion in the Russell Microcap Index, the recent activity in OPTT’s stock prices seems unwarranted. Without recent news coverage or significant changes in fundamentals, the company seems to be the latest target of the meme stock phenomenon that has been sweeping through the stock exchange. Driven by retail investors using the social media platform Reddit, underperforming companies are targeted for a coordinated short squeeze.
Future Outlook for OPTT
Armed with the fortuitous gains in its equity value, OPTT is poised to capitalize on the opportunities afforded to it in order to ensure more organic growth for the long term. Investors are hopeful that the management will leverage the resources at their disposal to usher in increases in shareholder value.
