Sanomedics Intl Hldg (OTCMKTS:SIMH) Still a Rollercoaster Ride

Yesterday the closing bell saw the share price of Sanomedics International Holdings, Inc. (OTCMKTS:SIMH) slashed by a quarter, on half of Friday’s volume. 8 million shares changed hands as SIMH navigated an intra-day dip of 40% in the red and sailed to a close 24% down.

Last Friday the company announced its Caregiver clinical non-touch IR thermometer has been picked as an ‘innovative technology’ by the Novation Innovative Technology Expo 2014. It’s not entirely clear what is so innovative about the thermometer, considering it does just what a number of other no-contact infrared thermometers produced by companies all over the world do – it takes a patient’s temperature without direct contact and gives accurate readings within a couple of seconds.

The announcement served its purpose – it boosted SIMH 12% up on Friday, after the price had just had an abysmal red run, dropping nearly 50% within four sessions. However, heavy selling smacked the share price back down yesterday.

It’s no wonder so much selling is going on, as unlike a month ago, now there seems to be an awful lot of common stock to go around. The company’s latest 10-Q reported 18 million shares of outstanding common stock as of August 11, 2014. Later on, a Schedule 13G filed on October 21 revealed that the outstanding share number was up at 33.8 million as of October 13. A new Schedule 13G lists a Coventry Enterprises LLC as the holder of 2.9 million common shares, that represent 6.29% of the OS. This in turn means the outstanding shares have now gone up to around 50,000,000.

This means that within the space of less than a quarter, SIMH managed to dilute its common stock by about 275% – no small feat even by OTC standards. The hopeful shareholders cheering after the early October price surge may find that this monstrous dilution is just what is dragging SIMH down and there are no signs things are about to change for the better.