The stock of Intricon, maker of lower-cost hearing aids and other tiny medical devices, has surged by about a quarter in value since Friday amid huge trading volume as buyers warmed to its financial outlook and favorable recent federal legislation.
The stock closed up nearly 10 percent to $11.25 per share Tuesday, the third day in a row of strong volume. More than 233,000 shares traded hands compared to normal daily trading of less than 10,000 shares of the historically low-profile, thinly traded Arden Hills-based designer and manufacturer.
Intricon, which is valued at about $77 million at Tuesday’s closing price, said it was unsure who was buying the stock in heavy amounts.
“We are always out talking to new investors,” said long-time CEO Mark Gorder. “We raised about $4 million last year and brought in Heartland Funds. But we know it’s not those folks buying. We’ve gotten some of interest in our story and more people seem interested in the logic of what we are doing and the [recent federal] law adds credibility.”
In late August, President Trump signed into law the U.S. Food and Drug Administration Reauthorization Act, which includes a provision that allows adults with mild-to-moderate hearing loss to access over-the-counter hearing aids without being seen by a hearing care professional.
Several of the world’s largest hearing aid companies, which dominate the hearing market and also are at least partial owners of thousands of retail audiologist operations, opposed the legislation. That includes Twin Cities-based Starkey Hearing Technologies and the locally based North American headquarters of Amplifon and ReSound, all of which sell hearing aids under various brand names.
Gorder and others successfully have argued that about 10 percent of the people served by the $11 billion hearing aid industry in the United States can be served with lower-cost, innovative products sold directly to consumers that also will spur competition and benefit millions.
The bill passed Congress with bipartisan support.
Intricon last month reported a small second-quarter profit on net sales of $22 million, up 32 percent from the same period in 2016.
That included a 46 percent increase in sales of electronic products that it manufactures for Medtronic, including a wireless-glucose monitoring system.
The hearing health business grew 32.5 percent from the second quarter of 2016.
Intricon has made a series of investments in hearing technology that the company says are bearing fruit.
Gorder said in an interview Tuesday the company is holding to its August statement to investors that it expects to be profitable this year on up to a record $88 million in net sales.That would be a 33 percent increase over last year.