The Reason Astrotech (ASTC) Shares Skyrocketed on Wednesday

NEW YORK (TheStreet) -- Astroctech (ASTC) shares skyrocketed higher on Wednesday after announcing it had signed an original equipment manufacturer (OEM) agreement with Japanese company RIGAKU Corporation. Shares soared 29.8% to $3.79 by mid-afternoon.

The Austin-based business said its subsidiary, 1st Detect Corporation, had entered into a strategic OEM agreement with RIGAKU, a specialist in chemical analysis instrumentation, including X-ray machinery and cryogenics.

Astrotech, a micro-cap aerospace company, said its OEM-1000PI mass spectrometer had been integrated with RIGAKU's Thermogravimetric Analyzer to create Thermo iMS2, a thermal analytics tool which measures changes in physical or chemical materials. The companies expect the device to be well received by the international research and development markets, particularly for applications in research, security, industrial, process flow and healthcare markets.

"We are proud to have had the opportunity to leverage our expertise in miniature mass spectrometry to provide a world-class chemical analyzer to RIGAKU," said 1 Detect chief technology officer David Rafferty in a statement. "By integrating our breakthrough technologies, RIGAKU is able to offer a TGA system that provides more performance, in a smaller instrument, than the competition."

TheStreet Ratings team rates ASTROTECH CORP as a Hold with a ratings score of C-. The team has this to say about their recommendation:

"We rate ASTROTECH CORP (ASTC) a HOLD. The primary factors that have impacted our rating are mixed -- some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. However, as a counter to these strengths, we find that the company's return on equity has been disappointing."

If you liked this article you might like

5 Stocks Under $10 Set to Soar Higher

5 Stocks Under $10 Set to Soar Higher

8 Must-Own Stocks to Complete Your 'Sweet 16' Portfolio

8 Small-Cap Aerospace and Defense Stocks to Sell Now

Astrotech (ASTC) Downgraded From Hold to Sell

Why Astrotech Corp (ASTC) Stock Is Soaring Today