Elon Musk, CEO of Tesla, is on the Tesla Gigafactory site. In the Grünheide near Berlin, September 3, 2020.
Patrick Pleul | image alliance | Getty Images
When Tesla CEO Elon Musk urged his Twitter followers to “use Signal” on Thursday, he meant the encrypted messaging application. Some people seem to have taken it the wrong way.
Shares of an obscure, unrelated company called Signal Advance, which trades over the counter, rose 527 percent on Thursday and 91 percent on Friday, rising from 60 cents to $ 7.19.
The signal Musk was referring to is operated by a nonprofit organization and serves as an alternative to text messaging applications such as Facebook Messenger, WhatsApp and Apple’s messaging service. That Signal came on Twitter on Friday to clarify that it has nothing to do with Signal Advance.
“It’s understandable that people want to invest in Signal’s record growth, but it’s not us,” Signal wrote. “We are an independent 501c3 and our only investment is in your privacy.”
It’s a familiar issue on Wall Street.
In April 2019, the day Zoom Video Communications made its long-awaited debut on the market, under the symbol ZM, a Chinese company called Zoom Technologies jumped by more than 80% in two hours of trading. The stock gave up most of those gains that day, closing 10%.
Six years earlier, while investors were waiting for the Twitter IPO, Tweeter Home Entertainment Group shares rose more than 1,000%.
Signal Advance was founded in Texas as Biodyne in 1992 and has provided services to medical and legal workers. The company has shifted its focus to the use of technology in healthcare and changed its name to Signal Advance. Thin traded shares hit the market in 2014.
Signal Advance is so small that it does not report financial statements to the SEC. As of March 2019, it had no full-time employees other than CEO Chris Hymel, who did not immediately respond to a request for comment.
Due to the swarm of unintended investor interest, the company now has a market cap of $ 660 million, up from $ 55 million two days ago. Prior to Thursday, the shares had traded below $ 1 since 2015.
The Signal Technology Foundation-supported messaging app “works entirely on donations,” according to a New Yorker article in October.
The group had other concerns following Musk’s tweet to his more than 41 million followers. Signal said on Thursday that there were technical problems with the checks, because “so many new people are trying to join.”
Both the technical snafu and the wild trading of an unbound stock underscore Musk’s growing influence. On Thursday, he became the richest person in the world due to the nearly 800% increase in Tesla’s market capitalization in the last year. On Friday, Tesla became the fifth most valuable public company in the United States, surpassing Facebook.
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