Tesla and SpaceX CEO Elon Musk inadvertently sent the stocks of an obscure company flying after urging his Twitter follows to “use Signal" - the encrypted messaging app which rivals Whatsapp – but led to confusion among stock market investors who bought shares in an unrelated business with a similar name.
Shares of the unrelated company called Signal Advance, which trades over the counter, surged 527 percent on Thursday and another 91 percent on Friday, climbing from 60 cents to $7.19.
The Signal that Musk was referring to is operated by a nonprofit and serves as an alternative to texting apps like Facebook Messenger, WhatsApp and Apple’s messaging service.
Messaging app Signal took to 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 this isn’t us,” Signal wrote. “We’re an independent 501c3 and our only investment is in your privacy.
Is this what stock analysts mean when they say that the market is giving mixed Signals?— Signal (@signalapp) January 8, 2021
It's understandable that people want to invest in Signal's record growth, but this isn't us. We're an independent 501c3 and our only investment is in your privacy. pic.twitter.com/9EgMUZiEZf
Signal Advance was founded in Texas under the name Biodyne in 1992 and provided services to medical and legal workers. The company shifted its focus to using technology in health care and changed its name to Signal Advance.
Signal Advance is so small that it doesn’t report financials with the SEC.
Because of the surge 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 stock had traded under $1 since 2015.
The confusion points to the growing influence of Musk in technology and innovation matter.
On Thursday, he became the world’s richest person thanks to Tesla’s almost 800 percent increase in market cap over the past year.
On Friday, Tesla became the fifth most valuable company in the US; surpassing Facebook.