Chatsworth Firm Puzzled by Stock Rise
Officials at International Remote Imaging Systems say they are scratching their heads over why the Chatsworth medical equipment company’s stock climbed briefly from less than $1 to more than $3 a share in the over-the-counter market late last month.
Company President Fred Deindoerfer, who bought 500 shares of the company’s stock in June at $1 a share, said he has no explanation for the stock’s rise or its dramatic increase in trading volume.
The stock’s price leveled off last week, closing Friday at $2.31, but trading remained brisk, with 239,200 shares changing hands.
On Aug. 19, the day before the stock began to take off, it closed at 94 cents on a trading volume of 64,900 shares. Since then, it has been the most heavily traded over-the-counter stock three times and, on different days, it was among the five biggest percentage gainers and losers.
International Remote Imaging, which makes automated equipment that hospitals use to perform urine analyses, has a pending $3-million new stock offering.
Company Losing Money
The August jump in the stock price of International Remote Imaging is particularly baffling because, although the company’s sales have increased in the past year, it continues to lose money.
“I really have no idea why the stock went up,” said J. Morton Davis, president of D. H. Blair & Co., which underwrote the new stock offering that is awaiting Securities and Exchange Commission approval.
“There are no secrets, just scattered buyers,” said Howard Finkelstein, who trades the stock for Shearson Lehman American Express. “I don’t think much of the company, to tell you the truth.”
The 6-year-old company, which employs 26 people, sold only one of its $75,000 urine-analysis machines before this year, Deindoerfer said. So far this year, however, it has sold 10 of them, he said.
Even so, during the three months ended June 30, the company lost $440,000 on revenue of $474,000.