After riding a wave last year that more than doubled the value of its stake in Palomar Medical Technologies Inc. (NSDQ:PMTI), a Baltimore money manager decided it’s time to take some of its chips off the table.
Brown Capital Management, which manages about $2.2 billion in equity holdings for its clients, sold off about 340,000 shares of Palomar stock between Oct. 1, 2009, and the end of the year, according to recent regulatory filings. Brown likely banked at least $1 million in profit from the transactions, and possibly more — a lot more — if it bought in before the stock spiked from around $11 a share to nearly $18 each back in June 2009.
The 60-percent-plus rally was spurred by Palomar’s June 5 announcement that it received 510(k) clearance from the Food & Drug Administration allowing for over-the-counter sales of its laser wrinkle-removal device. Palomar stock almost instantly added $5.80 a share the day following the announcement and pushed as high as $17.95 over the next week, before settling back to around $15 a share by the end of the month.
Heading into the April-to-June 2009 quarter, Brown Capital clients owned about 815,000 Palomar shares. That combined stake grew to around 1.16 million shares by June 30 and peaked at around 1.43 million shares at the end of September, as the stock bounced back to more than $16 a share.
Brown’s late-year selling coincided with a broader selloff for Palomar, which gave up nearly 40 percent of its value during the quarter to finish 2009 at just over $10 a share.