Wall Street traders flocked to a handful of putative security stocks Thursday in the wake of terror bombings on the London transportation system.
In a repeat of the frenzied, speculative trading that followed the 9/11 terror attacks and the Madrid train bombings, shares of companies that make bomb-sniffing devices and other high-tech security systems were soaring in early trading.
Some of the biggest gainers were video surveillance manufacturer IPIX (IPIX), up $1, or 36%, to $3.66; security fence manufacturer Magal (MAGS - Get Report), up $1.46, or 18%, to $9.33 and Synergx Systems (SYNX), a security technology firm, up $1, or 81%, to $2.41.
Ever since 9/11, speculators have raced in and out security stocks whenever there has been a major terror incident, or threat thereof. Many of the stocks investors have repeatedly poured into are small-cap concerns with little or no profits and just a few million shares available for trading.Some tiny companies have used the terror attacks as an opportunity to raise their profile. Sure enough, just hours after the London terror attacks occurred, a public relations firm for Blastgard International (BLGA.OB), a Clearwater, Fla.-based security company, was sending around emails to the news media trying to arrange an interview with its CEO James Gordon. In the email, Blastgard describes itself as "a revolutionary company creating bomb and explosive mitigating products, including the world's first bomb-mitigating trash can." Blastgard most recently traded at $1.40. One of the biggest beneficiaries of the interest in security stocks has been Taser International (TASR - Get Report), the stun gun manufacturer, which once saw its shares trade as high as $40 on a split-adjusted basis. In recent months, much of the air has gone out of the Taser bubble because of lingering concerns about the safety of its weapons and an accounting restatement. In premarket trading Thursday, shares of Taser were up just 15 cents, or 1%, to $10.09.