SoftBank Joins Nvidia In Backing Recursion Pharma, Retail Traders Rally Behind Stock Surge

Shares of Recursion Pharmaceuticals closed 23.88% higher on Friday, marking their best single-day gain in nearly two years. 

The rally extended into after-hours trading, with shares up over 4% and volume nearly five times the daily average.

The surge followed SoftBank Group’s disclosure of a 14.67 million-share stake in Recursion, as per a 13-F filing, valued at more than $154 million as of the last close. 

The Japanese conglomerate’s bet comes amid growing momentum in the AI sector, fueled in part by chipmaking giant Nvidia, which also holds over 7.7 million Recursion shares.

Recursion is a clinical-stage biotech firm using AI, machine learning, and automation to accelerate drug discovery. Its pipeline includes six programs, with some oncology drugs in Phase 2 trials. 

The stock is now on a six-session winning streak, its longest since mid-September.

Retail sentiment on Stocktwits remains ‘bullish,’ with traders speculating that the stock could reclaim $12 or even $15 levels.

Retail sentiment on Stocktwits remains ‘bullish,’ with traders speculating that the stock could reclaim $12 or even $15 levels.

Excitement is also brewing around “Stargate,” a $500 billion AI infrastructure initiative for OpenAI, backed by SoftBank, which has committed an initial $100 billion investment.

Short interest remains high at 16.2%, though it has eased from over 23% at the start of the year, according to Koyfin data.

Meanwhile, Recursion’s stock is trading about 13% above analysts’ average price target of $9.14.

Traders are eyeing the company’s Q4 earnings on Feb. 27, with Wall Street expecting adjusted loss per share to narrow to $0.41 from $0.42 a year earlier and revenue growing to $15.31 million from $10.62 million.

Recursion Pharma's stock has surged over 52% year-to-date.

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