By the time you read this, over a month has passed since Torchlight Energy Resources — which once carried the ticker name TRCH stock — announced that it completed the necessary steps to merge with Meta Materials (NASDAQ:MMAT). As our own Chris MacDonald reported, the merger officially closed on July 21. Effectively, those who want to invest in Torchlight must do so via MMAT stock.

Still, it’s a strange proposition to say the least. As Louis Navellier stated, TRCH stock prior to the merger was an investment in the acquisition and development of highly profitable domestic oil fields. And like so many other domestic oil firms, Torchlight was “headquartered in the heart of Texas’s famous Permian Basin region, which itself comprises a number of petroleum-rich basins.”

Thus, the investment proposition for TRCH stock was simple, albeit risky: bank on the recovery from the novel coronavirus pandemic. Given the scale of the public health crisis, the recovery narrative is by no means guaranteed. However, it offered reasonable encouragement, as data from the Bureau of Transportation Statistics indicate a conspicuous rise in the number of trips that people took this year.

With the gap narrowing, you’d figure that TRCH stock would be attractive to a company directly involved in the oil business. Instead, Meta Materials was the suitor, a company which develops functional materials and nanocomposites with the aim of delivering “breakthrough products to their customers in consumer electronics, 5G communications, health and wellness, aerospace, automotive, and clean energy,” according to InvestorPlace contributor Alex Sirois.

If that seems like a disparate operational focus, you’re not alone. Sirois stated diplomatically that the “synergies leading to the business combination are somewhat unclear.”

What does seem clear is that before the merger, Torchlight attracted social media attention, perhaps in a bid to short squeeze the security. But is this still a viable tactic?

The Dwindling Appeal of ‘DD-Less’ Contrarianism

One of the most intriguing aspects of the recent phenomenon regarding deliberately buying up shares of heavily shorted stocks is the much-distributed concept of due diligence — or DD in trading parlance — among social media circles.

Everybody encouraged DD regarding Torchlight. Curiously, though, the DD usually involved a meme and an admonition to go long the security lest you miss out on untold riches.

To be fair, MMAT stock does have headline metrics that suggest a compelling short-squeeze trade, or the deliberate attempt to “blow up” a short position by pushing the target equity unit to move higher, thereby forcing bears to cover their negative-trajectory trade.

According to Yahoo Finance, MMAT’s float is 87.62 million shares. The number of shares shorted is 11.65 million or 13.3% of the float. That’s significant bearishness. Usually, a company with a short percentage of float of 10% or higher is considered heavily pessimistic.

But one of the problems is that the short ratio, or days to cover, is only 0.46. Thus, based on average trading volume, bears can cover their position very quickly if circumstances go awry, potentially limiting upside for contrarian speculators.

Moreover, the meme stocks have decidedly lost their luster. I’m not going to get into the individual names because you already know them by now. But looking at their charts, it’s apparent that even the strongest of apes are starting to feel the pressure.

That’s not to say that MMAT stock can’t make a significant recovery. On the July 21 trade, shares experienced a robust move higher, undergirded by news that Meta Materials “joined the Stanford University SystemX Alliance industry affiliates program, which provides member companies a highly leveraged and cost-effective method to sponsor pre-competitive, collaborative research at Stanford.”

It’s impressive news but investors gradually sold into the implications of the announcement, cutting into the overall optimism.

MMAT Stock Is an Aspirational Play for the Gambler

I’m going to borrow Sirois’ term for Meta Materials as a pre-commercialization technology firm. It has great ideas, no doubt about it. Consider its non-invasive glucose-sensing prototype solution for diabetes patients.

As you probably know, the concept of implantable continuous glucose monitoring systems is all the rage in the medical equipment industry. The key difference for Meta Materials is that its solution would be non-invasive.

At the same time, the company probably has a long ways to go before reaching commercial success. If you don’t mind holding onto speculative investments for the long haul, MMAT stock might work out for you. But to be certain, there are better plays for your money that are viable right now.

On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare.