Tempest Therapeutics, Inc. (TPST) stock prices skyrocketed by 98.18% shortly after market trading commenced on July 12^th, 2021, bringing the price per share up to USD$31.05 early on in the trading day.

W.B. 2021 Biotech Conference

July 9^th, 2021 saw the company announce that the Chief Medical Officer of the company, Sam Whiting, M.D., Ph.D., will be participating in a webcast panel at the William Blair 2021 Biotech Focus Conference. Titled “Developing Therapies for the Next Immuno-Oncology Targets” and will be held on July 14^th, 2021. The announcement was met very positively by investors, who are hoping for a major announcement at the event.

Rock Springs’ Stake in TPST

Further driving the stock price higher is a recent SECSchedule 13-G filing that revealed Rock Springs Capital Management LP owned a 9.68% ownership stake in the company, having 642,155 shares under its control. The investment company is based in Baltimore and provides advisory services for businesses and institutional clients in regard to their security portfolios and portfolio management.

Explaining TPST’s Meteoric Rise

Nevertheless, the company’s recent stock price activity does not seem to be adequately contextualized by these developments. With the stock having risen as suddenly as it has, in the absence of concrete developments or changes in fundamentals, it seems likely that TPST has been selected as the latest target as a meme stock in the proliferation of the meme stock phenomenon that has been dominating the stock markets as of the start of the trading week.

Meme Stock Phenomenon

Driven by retail investors, underdog companies, sometimes on the brink of collapse, are artificially pumped with intentional disregard for any rational basis for the pump. Usually indicating a high short interest, these companies are selected as a means to take advantage of institutional investors’ confidence in the company’s stock prices falling. The coordinated short squeeze by retail investors has confounded Wall Street and has even resulted in the claiming of bankruptcy by some of the biggest names in finance.

Future Outlook for TPST

Rife with inherent risk and volatility, the recent fortuitous gains are not something that TPST can rely on to continue. Nevertheless, the increased exposure and skyrocketing of equity value afford the company opportunities to capitalize on in order to facilitate more organic increases in shareholder value.