RiT Technologies, Ltd. (NASDAQ:RITT) Could Rally Up Higher This Week

[[tagnumber 0]]It looks like the shares of RiT Technologies, Ltd. (NASDAQ:RITT) are extending the rally that started at the end of last month when the company announced promising first quarter results. What remains unnoticed by the market though is a recent sale of a warrant to an affiliated company that can transform into new shares soon.[[tagnumber 1]] [[tagnumber 0]][[tagnumber 3]][[tagnumber 1]] [[tagnumber 0]]On Monday, RITT closed the market with a 19.15% gain from the previous close at $1.12 for a share and nearly 400,000 traded shares, representing the highest trading volume since January this year. Technical indicators on RITT chart are just breaking critical levels, meaning the stock could jump even higher above the trading range.[[tagnumber 1]] [[tagnumber 0]] [[tagnumber 1]] [[tagnumber 0]]First quarter earnings of RITT looked good as the company reported a profit after showing only losses for many past periods. Its sales increased significantly to $3.39 million which is a 68% gain from the first quarter of last year. The company‘s management claims the improvement results from cost cuts and enhanced technology as operational expenses were down by 45%.[[tagnumber 1]] [[tagnumber 0]]That is yet to be appreciated by investors though as RITT will need to secure more cash this year, and possibly dilute further the shareholders. In June, RITT issued and sold a warrant to purchase 6,000,000 common shares to a company named Invencom Technologies Ltd. which is an affiliate of RITT controlling shareholder. Total amount of cash received in exchange for the warrant was $954,660 and the exercise price is $2.50 per share.[[tagnumber 1]] [[tagnumber 13]][[tagnumber 14]][[tagnumber 1]] [[tagnumber 13]] [[tagnumber 1]] [[tagnumber 13]]Another source of cash has been more extraordinary. According a filing with the SEC, also in June RITT received a short–term loan in the amount of $300,000 from the wife of the company‘s Chairman of the Board. The loan bears no interest and should be repaid in whole within two months. As the funds raised do not seem sufficient to cover even the expenses, any growth in value for RITT looks rather questionable.[[tagnumber 1]] [[tagnumber 13]] [[tagnumber 1]]