Talk about mixed signals!
The share price of an obscure medical device company jumped more than 400% after Elon Musk approved a messaging app of the same name – only to collapse on Tuesday as the confusion was dispelled.
The bizarre rally began after billionaire Tesla’s boss told his 42 million followers on Twitter to “Use Signal” on Thursday, apparently referring to the mobile app that allows users to exchange encrypted messages.
But investors instead bought shares of Signal Advance Inc., a small Texas-based company that makes devices used to detect various health problems.
The company’s shares, traded over-the-counter under the ticker symbol SIGL, climbed to $ 3.76 on the day of Musk’s tweet, from 60 cents the day before. Shares nearly doubled to $ 7.19 on Friday, then climbed 438% to $ 38.70 on Monday despite reports of apparent confusion among tickers.
But the stock fell 67% to $ 12.75 on Tuesday after Signal Advance issued a press release clarifying that it is not associated with the Signal messaging platform. Shares of the company were recently down about 68% to $ 16.14 at 1:08 p.m.
“The entities have no relationship with each other and Mr. Musk is not, to our knowledge, a shareholder of SIGL,” Signal Advance CEO Chris Hymel said in a statement on Monday. He also congratulated the other Signal developers on their success.
Investors looking to buy shares in the Signal app are out of luck – it’s owned by the Signal Foundation, a nonprofit that was established about three years ago.
Some 810,000 users around the world installed Signal on Sunday, nearly 18 times the number seen on January 6, the day of WhatsApp’s privacy change, according to data from research firm AppTopia.
Signal warned investors that this “has absolutely nothing to do” with the shares of Signal Advance as the latter company’s share price has skyrocketed.
“It’s understandable that people want to invest in Signal’s record growth, but that’s not us,” the app said on twitter. “We are an independent 501c3 and our only investment is in your privacy. “
With post wires