Penny Stock SMX Skyrockets over 120% — Here's Why

Just a few days after soaring almost 250% higher, shares in Security Matters (SMX), the Ireland-based track-and-trace and authentication tech firm, are back with a new rally. SMX rose by as much as 120% on Friday afternoon to reach $312.43 per share.TipRanks Cyber Monday Sale Claim 60% off TipRanks Premium for data-backed insights and research tools you need to invest with confidence. Subscribe to TipRanks' Smart Investor Picks and see our data in action through our high-performing model portfolio - now also 60% off The latest rally came two days after the company, at its annual general meeting in Dubai, made significant changes to its share structure. For instance, the meeting gave the go-ahead for the company to issue fresh stock and wipe out a huge block of the company's deferred ordinary shares. The shares being canceled are a low-ranking class stock that comes with little or no voting rights and only attracts dividends after all other share classes have been sorted. In other words, these shares have minimal economic value. Security Matters Rejigs Shares Structure The latest move signals a deliberate overhaul of how the company's equity is structured and a move to make the main ordinary shares more straightforward and attractive to investors. Last month, the authentication tech firm similarly amended its 2022 Incentive Equity Plan, enabling the company to significantly expand the pool of its shares. Security Matters Raises $111.5 Million Another likely contributory factor to the latest jump is Security Matters' latest raise of $111.5 million from Target Capital 1 through an equity purchase agreement. On December 1, Security Matters disclosed that it had arranged a deal to raise up to $11.5 million by selling new shares and a convertible loan to an investor called Target Capital. The company plans to use the fund to support its business as well as hold crypto on its balance sheet as a reserve asset. As an authentic company, SMX makes technology to monitor risks and fraud in the precious metal market. For instance, its unique molecular markers — which are registered digitally on the blockchain — can be placed on precious metals such as gold and silver for easier tracking. Is SMX a Good buy? As a penny stock, however, SMX remains highly volatile. It closed November 21 at $4.67 per share — a sharp contrast to today's price of over $312 per share. Since the start of the year, the stock has fallen almost 100%. Moreover, TipRanks' Technical Indicator currently shows that the Overall Consensus on Security Matters' stock is Neutral.