Sigma Labs, Inc. (OTCMKTS:SGLB) Makes Up for a Week of Sliding

After rolling with the punches for three weeks in the new year, yesterday Sigma Labs, Inc. (OTCMKTS:SGLB) finally shifted into higher gear and ended the week with a big bang. The ticker moved 9.4 million shares and stopped 24% up by the closing bell, at $0.14 per share.

The new year gave Sigma a rough time. The share price logged just two green closes over the last three market weeks. It seems that the company finally found its mojo on Friday.

The most current press release of Sigma came out last Monday and was reiterated in an official 8-K filing on the next day. The company announced the private placement of stock against the sum of $3.5 million. Sigma issued 43.7 million of shares in return and the deal comes with attached warrants for another 14.2 million shares.

Traders probably initially read bad news in the share price at which the financing took place. SGLB offered its shares at $0.08, a discount at the time of the offering. The good news is that the shares are restricted, which means no selling for a minimum of six months. Additionally, the warrants come with an exercise price of $0.15, so there’s no discounting done there.

Sigma never made any grand claims and the management stated that they will need funding to push PrintRite, the company’s in-process QA system, into commercialization. The $3.5 million may well be what the company needs at this stage. The financing does not constitute disastrous dilution either. Before the placement SGLB sat on 556 million common shares, so the newly issued 43.7 million diluted the company by less than 10%.

The next report due from the company is their 10-K for 2013 and while it will be an interesting read it will hardly cause any major movement for Sigma. Going forward in 2014, it remains to be seen how SGLB will put the new funding to use.