Biospherics can't explain increase in stock price

June 19, 1991|By Michelle Singletary | Michelle Singletary,Evening Sun Staff

For stockholders of Biospherics Inc., lightning does strike twice in the same place.

For the second time in three months, the company's stock price has shot up. Yesterday the price rose 36 percent, but company officials said they didn't have a clue as to why it soared.

In trading yesterday, the stock closed at $9.87 1/2 up $2.62 1/2 and 255,000 shares changed hands. On Monday, when the stock closed at $7.25, only 32,000 shares were traded.

On April 5, Biospherics stock closed at $4. The following Monday, the stock soared to $7.25. By the end of the second week in April, the company's stock had traded as high as $29 and as low as $4.50.

During 1990, the stock, which is traded over the counter, stayed in a range between $1.50 and $5.62 1/2 .

Biospherics, based in Beltsville, provides a range of environmental, health and information products and services to governmental agencies and private industry.

Karen Levin, head of the company's information services division, couldn't explain yesterday's stock trading frenzy.

"I guess sooner or later lighting does strike twice," said Levin, whose husband, Gilbert V. Levin, is president of Biospherics. "We just have no explanation this time," Levin said.

The Levins are major holders of the stock with a 52 percent ownership.

The first time Biospherics' stock took a turbulent ride, Levin attributed it to an article in the patents column in the New York Times. The article mentioned that the company had received approval for a patent on an economical method for producing a low-calorie sugar substitute called D-tagatose.

After the article the company's stock rose to an all-time high.

However, following another article in Barron's Business and Financial Weekly cautioning investors about D-tagatose's market potential, the stock fell to about $4.

Biospherics must seek approval to market the product from the Food and Drug Administration.

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