Galmed Pharmaceuticals (GLMD), a biotech company based in Tel Aviv, saw its stock skyrocket by almost 500% on Tuesday, following news that it had regained compliance with the Nasdaq Stock Market. The dramatic surge comes after Galmed was at risk of being delisted, and now the company is firmly back in the game. But what exactly caused this massive leap in share price? Let’s break it down.
Nasdaq Compliance Gives Galmed a Boost
Galmed’s troubles started last year when its stock price dipped below $1 for 30 consecutive trading days. As a result, the company faced a potential delisting from Nasdaq. However, in a recent filing with the Securities and Exchange Commission (SEC), Galmed announced that it had regained compliance by maintaining a minimum closing bid of $1 for 10 consecutive days, from August 30 to September 13. According to The Wall Street Journal, the company’s shares hit a 52-week high of $23.10 after the announcement.
Short Squeeze Sends GLMD Shares Skyward
While regaining Nasdaq compliance was significant, the real fuel behind the stock’s explosive rise came from a short squeeze. With only around 600,000 shares available, Galmed’s stock became a target for traders betting against it. According to Reuters, the stock’s relative volume surged to 600 times its daily average, creating a frenzy where short sellers were forced to buy back shares at skyrocketing prices, driving the value even higher.
At the time of writing, GLMD is sitting at $15.10, marking a 290.18% increase over the past one day.
