Shares of MongoDB (NASDAQ:MDB) climbed 15.6% today despite a lack of company-specific news.
Rather, it seems the likely catalyst could be a Barron's article, published Saturday, that highlighted investors' optimism for potential mergers and acquisitions involving relatively small cloud-software companies.
We should recall that MongoDB only just held its initial public offering this past October, so post-IPO volatility is likely still a factor. But for perspective, MongoDB announced strong fiscal fourth-quarter 2018 results just over two weeks ago. And there were no new press releases, SEC filings, analyst upgrades, or news from competitors since then that might otherwise be the the source of such a pronounced pop now.
This weekend, however, Barron's Tiernan Ray pointed out that MongoDB stock had soared 46% in the six weeks since the Nasdaq index bottomed on Feb. 8, 2018 -- a market beating rise he says can partly be credited to investors' hopes that any number of "cash-rich, established tech firms will pay up for these small fry in order to boost their own offerings."
Ray's musings certainly aren't without precedent. He also notes that just last week, salesforce.com agreed to acquire MuleSoft for roughly $6.5 billion, representing the customer relationship managment giant's largest-ever deal and a whopping 36% premium from Mulesoft's prior-day closing price.
But in the absence of hard acquisition news for MongoDB, and with shares now up more than 70% since early February, I feel the need to reiterate that investors should focus first on the fundamentals underlying any given business as they determine whether its stock is worthy of their portfolio. As such, and while MongoDB's latest quarter was certainly solid, I'm content to watch it from the sidelines for the time being.