NEW YORK (TheStreet) -- Shares of StemCells (STEM) were surging 678.1% to $2.71 on heavy trading volume mid-Tuesday afternoon after the company announced a definitive merger with Israel-based private company Microbot Medical to develop robotics-based medical devices.
Over 37.08 million shares of StemCells stock have traded so far today, above its 30-day daily average of 302,000 shares.
In the deal, the companies will pursue development of robotics devices to treat cerebrospinal fluid and gastrointestinal disorders.
"This transaction concludes an extensive search for strategic alternatives for StemCells since we failed to see robust clinical results in our Phase II clinical study of human neural stem cells in chronic spinal cord injury," Ian Massey, StemCells CEO, said in a company statement.
The deal has been approved unanimously by both companies' boards and will be put to shareholder vote.
StemCells, based in Palo Alto, CA, is engaged in the research, development and commercialization of stem cell therapeutics.
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
TheStreet Ratings rated this stock as a "sell" with a ratings score of E+.
The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, weak operating cash flow and generally disappointing historical performance in the stock itself.
You can view the full analysis from the report here: STEM