On Monday I wondered
what stock could possibly have been worthless at the end of 2005, but worth
$14 million at the end of 2006. A very loyal reader (really: the name on the
comment is "averyloyalreader") pointed out that the Boston Globe version
of the story
talked about "the private company whose stock they sold," which might
or might not imply that the company was closely held and not publicly-traded.
If it was public stock which got sold, however, Eddy
Elfenbein has a "completely wild guess": Cambridge
Heart. It’s in the right geographical neck of the woods, and its stock skyrocketed
at the beginning of 2006. At the beginning of December 2005 it was trading at
just 25 cents a share, which could well qualify as "worthless". By
March 17 2006, the stock was at $3.75 a share, giving the company a market capitalization
of more than $240 million. One can certainly see how a large slug of stock could
have been sold for $13.9 million.
And it’s lucky that they sold the stock where they did, too. The stock closed
today at just $1.38.