Shares of Veritone Inc. (NASDAQ:VERI) were up 28.7% as of 12:45 p.m. EDT Friday after Roth Capital Partners analyst Brian Alger defended the artificial intelligence specialist in the wake of a skeptical comment made earlier this week by short-seller Citron Research.
Veritone shares plunged more than 30% on Wednesday, then plunged another 20% on Thursday after Citron sarcastically tweeted that Veritone "is not artificial intelligence, more like natural stupidity." Citron then suggested Veritone stock "should trade right back to $20."
Today, however, Roth Capital Partners analyst Brian Alger retorted:
Citron's opinion that Veritone is not an AI company knocked the stock down 50%. We believe the data scientists who built and are refining [Veritone's] AI Ware Conductor would strongly disagree with this statement. Based on what we have seen over the past three weeks, we have no doubt that what Veritone is delivering is unparalleled and transforming businesses through the orchestration of third-party [artificial narrow intelligence] engines.
Alger also pointed out that while Veritone created its platform for media advertising customers -- and already counts among its clients the likes of CBS and NBC -- it's likely to expand its scope through mergers and acquisitions. Given the increased clarity into Veritone's potential, Alger boosted his price target on Veritone shares from $13 all the way up to $62.
That's a massive vote of confidence considering Veritone held its IPO in May at just $15 per share, and currently trades just shy of $47 per share. Though for perspective, thanks largely to a bullish Barron's article (subscription may be required) published a little over a month ago, the stock had also skyrocketed to nearly $75 per share just prior to Citron's tweet earlier this week. And I'll admit that move made me squeamish, considering the absence of tangible company-specific news supporting it.
For now, I'm still content watching Veritone from the sidelines while this post-IPO volatility subsides. But today's pop makes it clear that Alger's note caught the eye of investors.