The Brainchip share price is up 213% this month. Is Nvidia to blame?

The small cap Aussie tech stock is going bananas in 2024.

| More on:
A woman holds her hand out under a graphic hologram image of a human brain with brightly lit segments and section points.

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The small Australian technology company Brainchip Holdings Ltd (ASX: BRN) has enjoyed a spectacular 178% rise in its share price so far this year.

Just this month, it has rocketed a staggering 213%.

That's a pretty crazy climb by anyone's standards.

So what's going on?

This is the official news from the company

The answer is, officially, nothing.

The only news the company has posted to the ASX in 2024 is a fairly benign quarterly activities report, which made no ripples in the stock price at the time.

In fact, it made the ASX suspicious enough that last week it sent the tech company a "speeding ticket" to enquire if it knew why the stock was soaring so much.

Brainchip management answered that it was not aware of any reason why the shares have rocketed so violently this year.

Thus we can only make some educated guesses.

So what could be driving the Brainchip share price?

The most likely reason is that, as an artificial intelligence (AI) chip maker, the hype around that technology is whipping speculators into a frenzy for Brainchip.

The poster child of the AI revolution, Nvidia Corp (NASDAQ: NVDA), has seen its stock rise 63% this year, or a dizzying 232% if you go back 12 months.

This may well be inducing get-rich-quick traders to pile onto anything related to AI.

Back during the COVID-19 pandemic, Brainchip shares were known to be something of a meme stock, where speculators often discussed it in online forums.

One of those discussion boards, HotCopper, is showing that the "2024 BrainChip Discussion" conversation thread is lighting up.

A vomit-inducing rollercoaster ride

The speculative nature of the stock is shown in the volatility over the last few years.

The Brainchip share price was languishing at just 5 cents when the pandemic arrived in Australia. By January 2022, it had rocketed to around $1.76.

Then as recently as late January, the stock was just moving sideways around 16 cents.

Now on Friday afternoon, the tech stock is trading a mighty 20.9% higher at 52 cents.

Brainchip chief executive Sean Hehir is due to host a Virtual Investors Roadshow on Tuesday morning, which could make for fascinating viewing.

Motley Fool contributor Tony Yoo has positions in BrainChip. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Nvidia. The Motley Fool Australia has recommended Nvidia. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Share Gainers

A young man talks tech on his phone while looking at a laptop. A financial graph is superimposed across the image.
Share Gainers

Why Capricorn Metals, Insignia, Perseus Mining, and Qoria shares are storming higher

These shares are having a strong session on Tuesday. But why?

Read more »

A man clenches his fists in excitement as gold coins fall from the sky.
Share Gainers

Why Amaero, AMP, Block, and South32 shares are racing higher today

These shares are starting the week on a positive note. But why?

Read more »

Ten happy friends leaping in the air outdoors.
Share Gainers

Here are the top 10 ASX 200 shares today

It was another momentous session for ASX shares this Friday.

Read more »

Overjoyed man celebrating success with yes gesture after getting some good news on mobile.
Share Gainers

Why BHP, Catalyst Metals, Mesoblast, and Pilbara Minerals shares are shooting higher

These shares are ending the week with a bang. But why?

Read more »

Doctor doing a telemedicine using laptop at a medical clinic
Healthcare Shares

The Mesoblast share price just rocketed 38%! Here's why

ASX investors just sent the Mesoblast share price up 38%. But why?

Read more »

A businessman stacks building blocks.
Share Gainers

Here are the top 10 ASX 200 shares today

ASX shares hit a new record high today.

Read more »

A man sees some good news on his phone and gives a little cheer.
Share Gainers

Why Auckland Airport, Australian Ethical, Breville, and Clarity shares are charging higher

These shares are having a better day than most on Thursday. But why?

Read more »

A man sits on a bench atop a mountain with a laptop, making investments with a green ESG mind.
Share Gainers

Here are the top 10 ASX 200 shares today

Investors endured a day to forget this hump day.

Read more »