MEDIROM (MRM) stock surged 73%, Eargo (EAR) tanked 68% on Thursday

Highlights

  • MEDIROM Healthcare Technologies Inc (NASDAQ: MRM) agreed to acquire all the shares of Japanese hair salon operator ZACC Kabushiki Kaisha. 
  • Eargo, Inc. (NASDAQ: EAR) stock tanked nearly 68% on Thursday on the news of a probe by the US Justice Department against it concerning insurance claim reimbursement.
  • The MRM stock grew 73%, and EAR stock fell 69% in the last five days.

MEDIROM Healthcare Technologies Inc. (NASDAQ: MRM) stock jumped 72.55%, and medical device company, Eargo, Inc. (NASDAQ: EAR) stock fell 67.97% at 3:40 pm ET on Thursday.

MRM traded at US$12.75, and EAR was priced at US$6.9401 at the time.

MEDIROM Healthcare Technologies Inc.

On Sep 22, the MRM stock had closed at US$7.39 with a trading volume of 1,540,746. 

The jump in share volume and price comes after Medirom on Wednesday announced to acquire 100% shares of ZACC Kabushiki Kaisha. The deal value is around US$3.36 million or Japanese yen 370,000,000.

The Tokyo-based healthcare company’s current market capitalization is US$61.1 million. The company provides healthcare through franchise and healthcare salons.

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The company will release its interim financial results for the six months ended June 30, 2021, in October. For the fiscal year ended Dec 31, 2020, its revenue was 3.34 billion Japanese yen, and net loss was yen (539) million. The revenue and net income for FY 2019 were yen 3.91 billion and yen 17.34 million, respectively. 

The stock closed at US$12.80, an increase of 73.23%, on Sep 23, 2021.

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Trending stocks: Medirom Healthcare (MRM) and Eargo, Inc.)

Source – pixabay

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Eargo, Inc.

It is a medical device company that provides hearing aids, professional support, and insurance-related services. The stock tanked nearly 68% on the news of a probe by the US Justice Department. 

The shareholder rights litigation firm Schall Law announced on Thursday about a probe against Eargo Inc. On Sep 21, the company was informed about opening a criminal investigation by the US Justice Department. The Department will probe Eargo’s insurance claim reimbursement which it had submitted on behalf of its customers covered by federal health schemes. 

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The company has withdrawn the guidance for FY ending Dec 31, 2021, its SEC filing shows. On Sep 22, the stock had closed at US$21.67 with a trading volume of 1,527,937. 

For the June quarter of 2021, the company earned revenue of US$22.88 million compared to US$15.9 million in the June quarter of 2020. The net loss was US$19.32 million against a net loss of US$6.59 million in the June quarter of 2020.

On Sep 23, 2021, the stock closed at US$6.86, down 68.34%.

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Bottomline

MEDIROM Healthcare (MRM) stock fell 11.11% YTD. However, it grew 73% in the last five days. On the other hand, the Eargo Inc. stock fell 69% in the five days but gained 85% YTD. Investors must evaluate the companies carefully before investing in stocks.

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