Social media chatter about a stock is now an important factor when it comes to rallies or slumps in a stock and hence, the move in the Sonnet BioTherapeutics (NASDAQ:SONN) stock on Thursday is worth looking into.
Yesterday, there was no news about the company but considerable buzz about the stock on social media led to a remarkable rally and the Sonnet stock ended the day with gains of as much as 64%. Many users on the social media platform Twitter have identified the Sonnet stock as a potential target for a short squeeze and that led to retail investors piling on to the stock in the hopes of sending the price soaring.
There was heavy action in the stock and it ended up being one of the biggest gainers during premarket trading period. In this regard, it is necessary for investors to keep in mind that the Sonnet stock is still a penny stock despite having recorded such enormous gains. On the other hand, the rally the stock enjoyed yesterday might not last today and many investors might choose to book their profits. Hence, it might be a good idea to be careful with the Sonnet stock at this point.