BrainChip Shares Hit New All-Time High as Share Price Surge Proves Relentless (ASX:BRN)

2022 looks to be shaping up to an incredible year for BrainChip Holdings Ltd [ASX:BRN]. After capping off last year with a 68 cents per share finish, the stock has gone ballistic.

Today, following a 15.71% spike higher, BrainChip shares are now sitting at $1.62 each. Representing just over a 130% gain in the first two weeks of the new year.

Needless to say, that is an unbelievable surge for a stock of BrainChip’s calibre.

But when you consider the reasons behind this momentum, it’s easy to see why investors are bidding this stock up so high…

More capital, more development, more gains

Today’s announcement that sent BrainChip to fresh all-time highs isn’t exactly groundbreaking. In fact, it was a simple capital call notice — something that shareholders are probably used to seeing by now.

Turning to their key partner, LDA Capital, the company has once again secured more cash for development of their AI chips, this time signing off on 15 million shares for a fresh top-up of $20.3 million — $5.3 million of which was deferred from a similar agreement last year.

More importantly, this commitment represents just a portion of the total available funds. According to BrainChip, there’s up to $50.3 million in capital available under this agreement. And according to management, they plan to draw down at least $35.3 million of that sum before the end of 2023.

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As you’d expect, this sort of capital stockpile gives them plenty of room for development, allowing BrainChip to spend the time and money it needs to bring its revolutionary microchips to market.

BrainChip CEO, Sean Hehir, made sure to note that in his comments from today’s update:

The proceeds raised from the capital call will be used to expand our go-to-market capabilities as we move the company aggressively into the commercialization phase.

The company will also accelerate our continuous innovation of the groundbreaking Akida technology to ensure we remain the industry leaders in Edge AI.

So investors clearly believe this Aussie firm is close to meeting those goals. Speculation that has certainly been spurred on by recent reports of Mercedes-Benz experimenting with their Akida hardware.

What’s next for BrainChip?

With money seemingly no longer an issue, shareholders will be eagerly awaiting management’s next update.

After all, the next major milestone should either be about manufacturing these chips, or some sort of commercial agreement.

Either way, the company is getting closer to finally bringing their tech to market. A feat that could make them the latest small-cap success story in Australia.

If BrainChip doesn’t take your fancy, don’t worry. There are plenty more small-cap opportunities across a range of sectors with just as much potential. In fact, you can read about some of our favourites in this detailed report right here.

Because when it comes to high-flying stocks, you can’t beat small-caps.


Ryan Clarkson-Ledward,
For Money Morning

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Ryan Clarkson-Ledward is an Editor at Money Morning.

Ryan holds degrees in both communication and international business. He helps bring Money Morning readers the latest market updates, both locally and abroad. Ryan tackles all the issues investors need to know about that the mainstream media neglects.

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