Integrated Alarm Services Group Inc. (symbol: iasg) has seen a recent jump in price of more than 50% and it doesn't look like stopping any time soon.

Integrated Alarm Services Group (I will refer to it as iasg from now on) appeared to many investors as a bad investment, the IPO was overpriced and the company was losing money. The IPO was a bit expensive at $9.00 a share but the stock has already been punished for that. The company is in a unique industry that not many investors understand, it is an alarm company. These companies pay about $1,200 to install an alarm company that they charge a customer a few hundred dollars for, as part of the installation agreement the customer agrees to pay the company to monitor the system for a set period of time. While this makes it seem like the company is poorly managed all that it really means is that the company is growing.

Those investors who don't understand the company have shorted it, now they are about one share short for every five shares outstanding. These shorts are beginning to cover and that is sending the stock on a rampage. In addition to this there has been a lot of insider buying that has pushed the stock higher and higher, plus regular investors like you and me are catching on to this stock. The stock closed at $3.64 today and it appears it may hit $5 before new year's day but even $5 would be a discount to the company's book value of $5.23 a share. I bought two weeks ago at $3.29 and I won't sell any time soon.

disclosure: the author owns shares of iasg