MicroVision Sees New Highs with Help from Paid Touts, Social Media Influencers, and Speculation

The Reddit Bump

On January 26, 2021, shares of Microvision, Inc. (NASDAQ: MVIS) closed above $8 for the first time since sliding down from a 52 week high from December, 2020. The $8.14 close was aided by a small pump from the Reddit forum, "Wall Street Bets". A MicroVision retail investor posted exaggerated buyout speculation around noon to take advantage of the recent focus on Reddit stock trading forums. Previous artificially inflated highs came as a result of paid promoters, social media influencers, and recycled speculation.

Social Media Influencers

Earlier, on January 14, 2021, there was a pump by a trio of social media influencers with potential combined Twitter and StockTwits followers of 598,000. Within a time span of just five minutes, starting at 3:01 PM, messages of inducement posted from @Ultra_Calls, @Traderstewie, and @ACInvestorBlog. The immediate effect was a sharp rise from $6.25 to a high of the day $7.

Previously, it was media personality Dave Portnoy who posted to his 1.5 million followers on July 17, 2020. Portnoy's tweet led to a then 52 week high of $3.45 and he is currently being recruited to mention MicroVision again.

Paid Promoters

Nothing has been as effective at inflating MicroVision as the paid promotion that culminated with an article on the NASDAQ website on December 22, 2020. With the credibility of NASDAQ and wide distribution, the price surged to a 52 week high $9.74. The NASDAQ article speculated that Apple Inc (NASDAQ: AAPL) may want MicroVision's proposed LiDAR. The author falsely claimed that MicroVision is one of the "best LiDAR systems available today". In fact, MicroVision's automotive LiDAR has been seen solely as a YouTube animation and its vague specifications are mostly very average.

The other penny stock mentioned in the article, Elys Game Technology Corp (NASDAQ: ELYS), also attained its 52 week high on December 22. The third stock, Marvell Technology Group Ltd. (NASDAQ: MRVL) is not a penny stock and was unaffected.

The original story was authored by StockMarket.com, a self-described paid stock promoter. This website publishes only positive news. They are paid to inflate the price. Their general disclaimer states, "We are paid advertisers, also known as stock touts or stock promoters." The website also warns that after they finish promoting a stock, the price will go down and investors "will likely lose most, if not, all of their investment." While the disclaimer may protect the website legally, it doesn't explain why NASDAQ allows their credibility to be used for paid promotion of penny stocks. According to the website, the list of people who pay for a stock tout includes a single investor, a group of investors, or the company itself.

Retail Investor Growth

A sample of the meteoric growth of MicroVision among retail investors can be seen at Robintrack, which recorded the number of Robinhood users who bought the stock from January to August, 2020. The number of Robinhood investors grew from approximately 15,000 on May 1 to 45,000 on May 5 when Reddit started speculation that Microsoft might be interested in buying the company. Microsoft Corporation (NASDAQ: MSFT) Mixed Reality Global Lead Alison Fehling denied the rumor when pestered by MicroVision fans during a webinar, yet a variation of the rumor is recycled every few weeks on social media.

Unsustainable Highs

Without a constant flow of speculation and misinformation that attracts novice traders, MicroVision's natural tendency is to surrender its new highs until the next cycle of artificial inflation.

In the medium term, a correction is logical to $3.37, the stock's December average prior to the paid NASDAQ article. However, MicroVision's cult following stopped being logical and their insatiable appetite for cheaper shares is unpredictable. Without substantive news or if MicroVision's proposed LiDAR sample isn't completed by April or fails to meet all claimed specifications, MicroVision's retail investors may finally awaken from their buyout dream to realize that they were deceived by a campaign of paid promotion.