EnteroMedics Inc: Why ETRM Stock Is Soaring

ETRM StockETRM Stock on the Rise

EnteroMedics Inc (NASDAQ:ETRM) is not a stock for the faint of heart. The share prices of ETRM stock are back on top, rising by nearly 10% by the opening bell on Monday, continuing the recent spate of ups and downs in EnteroMedics stock.

There hasn’t been much in the news lately that’s pushed the stock back up. Earlier in January 2016, ETRM stock hit a high of $27.28 per share, a far sight away from its current value of $8.61 per share. The jump was facilitated by some good news coming out about their “vBloc” neurometabolic therapy, which is a treatment for obesity involving a pacemaker-like device that is implanted in the patient and works to curb the user’s hunger. The vBloc treatment was added to two new institutions earlier in the month, pushing the stock price up by as much as 1300% in five days.

Both MedStar Health in Maryland and Roper St. Francis in South Carolina added the treatment, according to the press release.

But, since that explosion of ETRM stock’s good fortune, the company has been on a rocky ride. Traders have caused the price to fluctuate over the past few weeks, showing gains and falls in the double-digit range.

Another item worthy of note is the increase in short positions on ETRM stock. Short traders grew in number in December, buying up more than 10 million shares as of December 15, a growth of 45.2% from the two weeks before, which registered over 700,000 shares being shorted. The new increased short position accounts for about 9.3% of total available ETRM shares. (Source: “THE STOCKS: ENTEROMEDICS INC. (ETRM) SHORT INTEREST UPDATE,” DailyQuint, January 22, 2017.)

This makes ETRM both an attractive target for those who believe in the product, the company, or the stock itself, but also for those looking to make a quick buck off of what they perceive to be a weakness in EnteroMedics. With the fluctuations being as volatile as they have been in recent days, it’s easy to see the validity in both positions, and any savvy investor looking to buy into the company should be aware of the potential for volatility.