Synergetics USA Inc. ($ SURG) Surges after Alcon ($ACL) Agreement
Synergetics USA Inc. ($ SURG) Surges after Alcon ($ACL) Agreement
Shares of Synergetics USA Inc. (NASDAQ: SURG) soared more than 50% in trading today. The small-cap stock reached a high of $3.19 in trading and spiked 38.92% to $2.57 at last check, with volume up from daily average of 89,000 to 1.25 million. O’ Fallon, Missouri-based Synergetics is a medical device company.
The surge in the small-cap stock comes on the back of an announcement made by the company on Tuesday that it has signed a pair of agreements with Alcon Laboratories (NYSE: ACL) that will grant Alcon a license to sell some of the products manufactured by Synergetics for worldwide distribution on a co-exclusive basis through the vast Alcon network. The agreement will also settle all litigations between the two companies. Synergetics will receive $32 million from Alcon for selling some of its patented products worldwide as well as settle pending litigations between the two companies.
According to the company’s 10k filing with SEC, its future results depend largely upon the successful transition of its neurosurgical products to its marketing partners. So the agreement with Alcon should be a positive for the company. On April 8, the company had said that it closed a deal worth $3 million with Stryker Corporation (NYSE: SYK), which would see Stryker acquire the rights to a bone-cutting tool produced by the company. On March 17, the company reported its second-quarter results, posting net income of $877,000 and sales of $13 million.
In its 10k, the company mentions that its stock may be highly volatile. The company says that market price of the small-cap stock depends on its ability to successfully commercialize its products, execute new agreements, quarterly results, changes in key personnel and announcements of technological innovations. Currently, the small-cap stock is trading above its 50-day and 200-day moving average. It has seen a 52-week range of $0.93-$3.10, with $3.19 being touched in today’s trading.
