What happened

Shares of Zomedica Pharmaceuticals (ZOM -0.77%) rose 72.4% this week, according to data from S&P Global Market Intelligence. The veterinary health diagnostics stock closed last week at $0.29, then opened on Monday at $0.30, and didn't see the stock spike until it hit a high of $0.4899 on Thursday. The stock's 52-week high is $2.72, and its low $0.27. Despite the rally this week, the stock is down more than 81% over the past year.

A veterinarian holds a small dog in a clinic.

Image source: Getty Images.

So what

Zomedica isn't an investment for the faint of heart. With just $22,514 in revenue in the third quarter,  this stock is speculative at best. However, with it ending last week near its 52-week low, it was seen by many investors as an inexpensive gamble. Bear in mind, too, that as low as Zomedica has been trading, it doesn't take much of a bump to get a huge percentage gain, especially with only a $373.3 million market cap.

For the most part, this seems to be a Reddit- and meme-driven run with very little real news behind it. On Thursday, the stock was the 25th most traded stock on the Robinhood Top 100. The company recently named Vice President Adrian Lock, the former CEO of PulseVet, as the leader of the company's sales organization. But that was on Tuesday, two days before Thursday's surge.

Now what

This isn't the first time that Zomedica has benefited from a meme-fueled buying spree. On Feb. 8, 2021, the stock climbed $1.21 in one day to $2.91 only to fall back to $1.75 by the end of the month. There's a good possibility this short squeeze won't last long, leaving some investors a little poorer for their troubles.

That's not to say the healthcare company doesn't have possibilities. Pet owners spent $31.4 billion on veterinary care in 2020, according to data from the American Pet Products Association. That figure was expected to rise to $32.3 billion in 2021. It's also too early to tell if the company's $70.9 million purchase of PulseVet in October will pay off. PulseVet uses shock wave therapy to help pets' wounds heal, to treat chronic pain, osteoarthritis, and injuries to bones, tendons, and ligaments. It's a technology that is already used, with some success, on humans.