[[tagnumber 0]][[tagnumber 1]]After some impressive performance in March we saw Pervasip Corp (OTCMKTS:PVSP) begin to hesitate in April and go to a downward slide that pushed it back to triple zero land in late–May.[[tagnumber 2]] [[tagnumber 0]] [[tagnumber 2]] [[tagnumber 0]]Since then, the ticker has been hovering around the $0.001 per share mark. The main reason for the upward performance was the fact that the company decided to get involved in the legal cannabis business a few months ago. Fact is, however, that [[tagnumber 6]]PVSP[[tagnumber 7]] has had some really terrible financial performance lately and the report for the quarter ended February 28, 2015 just proves that.[[tagnumber 2]] [[tagnumber 0]] [[tagnumber 2]] [[tagnumber 11]] [[tagnumber 12]]cash: $2,623[[tagnumber 13]] [[tagnumber 12]]current assets: $219,788[[tagnumber 13]] [[tagnumber 12]]current liabilities: $12,177,301[[tagnumber 13]] [[tagnumber 12]]quarterly revenues: $894!!![[tagnumber 13]] [[tagnumber 12]]quarterly net loss: $1,989,982[[tagnumber 13]] [[tagnumber 22]] [[tagnumber 0]] [[tagnumber 2]] [[tagnumber 0]]Those numbers surely look horrible, especially compared to previous reports from the company, which were not very optimistic either. Still, that isn’t stopping [[tagnumber 6]]PVSP[[tagnumber 7]] from gathering upward momentum for quite some time now.[[tagnumber 2]] [[tagnumber 0]] [[tagnumber 2]] [[tagnumber 0]]After going nowhere on June 25 we saw [[tagnumber 6]]PVSP[[tagnumber 7]] record the past 5 sessions in the green. The ticker’s latest gain of 10% pushed it to $0.00165. Although the stock is recording positive movements we see that the volumes are around the average and a total of 72 million shares were traded in yesterday’s session, generating $115 thousand in daily trade value.[[tagnumber 2]] [[tagnumber 0]] [[tagnumber 2]] [[tagnumber 0]]There is, however, the matter of the vast amount of debt that is in the form of convertible notes we wrote about in our previous article. This means that a lot of highly discounted shares might have seen the light of day, which is almost always a recipe for disaster.[[tagnumber 2]] [[tagnumber 0]] [[tagnumber 2]] [[tagnumber 0]]Do thread carefully and be sure to do your due diligence and weigh out the risks before putting any money on the line.[[tagnumber 2]]
[[tagnumber 0]][[tagnumber 1]]Times have been rough for the stock of New Gold Inc. (NYSEMKT:NGD) recently. Not only does the stock remain light years away from its 52–week high but it also scored a new 52–week low last Monday after the intermediate gold mining enterprise revealed its next earnings conference call scheduled to take place on July 28 after market close. We have yet to see what the impact of this forthcoming quarterly report will have on the chart performance of NGD. What we do know, however, is that the stock is in dire need of getting some fresh air.[[tagnumber 2]] [[tagnumber 0]]As it seems, New Gold has found itself in a steady downtrend which started in mid–October of 2014 following the bearish crossover between the 50–day moving average and its longer–term 200–day counterpart. Almost nine months later, we have yet to see a bull market for NGD on the horizon, except for the fact that NGD‘s continual recent plunge has not pushed the stock to an oversold level, which makes a slight rebound more likely in the immediate term. Will it be enough to buck the trend, though?[[tagnumber 2]] [[tagnumber 0]][[tagnumber 6]]New Gold was last seen profitable in 2012 when the company raked in an annual profit of $199 million, which was offset by an identical loss in 2013. Things got even worse in 2014 when a slight decrease in revenue resulted in a huge net loss in excess of $477 million, largely due to high production costs and a huge chunk of non–recurring expenses. Nevertheless, NGD managed to rake in $726 million in revenue, decrease its per–ounce all–in sustaining costs by $120, or 14%, as well as considerably improve its adjusted net cash generated from operations.[[tagnumber 2]] [[tagnumber 0]]During the fiscal year ended Dec. 31, 2014 New Gold Inc. met its goals both in terms of gold and copper production. The company is currently operating four fully–producing assets with three more projects still under development. Given the volatile nature of metal markets, the main challenges lying ahead of New Gold Inc. will revolve around a/ expanding production sites and b/ optimizing the costs associated therewith.[[tagnumber 2]] [[tagnumber 0]]New Gold shares closed the July 2 trading session at $2.69 on a volume of 3.55 million, slightly above both its 52–week low of $2.63 from June 30 and its daily average trading volume of 3.05 million, respectively.[[tagnumber 2]]
Some of the long-term shareholders now admit that they didn’t have much confidence in BioSolar Inc (OTCMKTS:BSRC) a couple of weeks ago. They say that they expected to see the stock plummet all the way down to $0.0001 and get reverse split. Currently, they feel quite a bit different.
And with good reason. BSRC‘s recent performance has been nothing short of astonishing. The ticker first saw some volume on June 16 when it was sitting at just $0.07. Right now, a little over two weeks later, it’s pegged at a hair under $0.52. Yesterday BSRC also reached a 52-week high of $0.54 and by the looks of things, the liquidity problems it was experiencing up until mid-June are now gone.
The reason for all the commotion consists of a single press release that hit the wire a couple of weeks ago. With it, BSRC announced that they are in the process of developing a cheaper, more powerful, faster-charging lithium-ion battery that will double the range of a Tesla automobile and will reach the $100/kWh cost barrier which is considered something of a holy grail in the industry. The management team told us all about how the battery will work, but they somehow forgot to say when they expect to be ready with it.
So, basically, BSRC added a mind-boggling 640% just because the people behind the company said that they can transform the world as we know it. And that might be a bit of a problem because if the latest 10-Q is anything to go by, making any sort of impact on the way we live is going to be a tall order for BSRC. The figures at the end of March looked like this:
- cash: $173 thousand
- current assets: $239 thousand
- current liabilities: $3.6 million
- NO revenue since inception
- quarterly operating expenses: $155 thousand
Coming up with a ground-breaking alternative to a proven technology with less than $200 thousand in the bank and a working capital deficit of $3.4 million won’t be easy. That’s not the only problem.
Before plunging into the battery industry, BSRC were saying that they can develop innovative products that were supposed to reduce the cost of electricity produced by photovoltaic solar panels. Lots of promises were made over the years, but they have obviously come to nothing.
Even if you reckon that they’re going to do it this time, you mustn’t forget one important thing – while you may be prepared to pay $0.50 per share for BSRC‘s stock, other people could be getting it for a lot less than that. As we mentioned in some of our previous articles, the company’s books are riddled with convertible notes which (in some cases) can be turned into stock at a 50% discount.
The ticker was diluted by about 46% between May 2014 and May 2015 and a vast portion of the newly issued shares saw the light of day at prices that are way below the open market value. In April, for example, BSRC satisfied some debt with the issuance of about 2.8 million shares at just over $0.03 apiece. At the same time, people like you were paying between $0.06 and $0.12 per share. That doesn’t seem too fair from a shareholder point of view and it would be downright terrible if the discounted shares somehow find their way to the open market.
After another month and a half of silence yesterday Baltia Air Lines Inc (OTCMKTS:BLTA) published a new PR. In it the company announced that its Initial Cadre Check Airmen (ICCA) have successfully completed the recurrent training in a simulator in preparation for Check Airmen certification to be conducted during proving flights. The fact that the company has passed another test is definitely encouraging but it is not what investors wanted to see.
Baltia entered Phase III of its FAA Air Carrier Certification back in October 2014 and initially things were going rather smoothly. Unfortunately, the company failed to pass the mini evacuation test and has been unable to do so for quite a while. Rumors about the successful passing of the evacuation test were flying around for months but with no official confirmation the hype quickly died down. As a result the performance of BLTA’s stock has been so atrocious that this Wednesday it dropped to a new 52-week low of $0.0033.
Yesterday’s PR did attract some attention and the daily volume of 35 million shares surpassed the one from the previous session by more than 3 times but the intensified trading did not translate into a more pronounced move in the right direction – the stock closed less than 3% in the green and even those gains were registered right before the closing bell. Compared to its price from the start of March the stock is down by nearly 80%.
The problem is that even if Baltia finally move forward with their certification that won’t make the red flags any less serious. The latest quarterly report revealed that at the end of March BLTA had:
• $118 thousand cash
• $131 thousand total current assets
• $2.9 million total current liabilities
• ZERO revenues
• $2.8 million net loss
Last year Baltia had to issue the mind-boggling amount of 2.2 BILLION shares which meant that as of December 31, 2014, the company had 5.5 BILLION outstanding shares. The issuance of shares hasn’t slowed down with the start of 2015 and as of May 4 the outstanding shares had reached 5.98 million shares. In order to accommodate the future issuance of shares BLTA had to amend their authorized amount increasing it to 6,986,000,000 common shares.
With the stock sitting at near-record low prices and myriad of extremely serious red flags any trades should be attempted only after extensive due diligence.
After a three-day dizzying excursion up the charts, Thinspace Technology Inc (OTCMKTS:THNS) is now rushing back down, wiping gains with broad, carefree strokes. Yesterday the company closed another 17% down, stopping at $0.007 per share as 38 million shares changed hands.
Despite dropping what was presented as big news before the market opened on Wednesday, THNS slid some 30% over the next two sessions. The company announced AlarmForce, a home security business, “selected” Thinspace as its virtualization solution provider. The news did absolutely nothing to stop the declining price from slipping further.
The endless downpour of paid pump emails targeting THNS also plays a major part in the company’s disappointing chart movement. In April THNS was trading at $0.10 per share, then 80 pump emails later, it’s flattened over 90% below those levels, trading in double zeroes.
The latest pump clocked in along with the press release about AlarmForce, echoing the official company statement. Promoter outfit TheNextBigTrade dot com disclosed receiving $20,000 to advertise THNS stock.
THNS reported 104 million outstanding common shares as of May 12 this year. With 114 million in daily volume last Friday, the company’s common shares have likely gone up from that number and by no small percentage at that.
The pumps for THNS show no signs of slowing down and until at least those come to an end, the company’s chart performance might continue to disappoint.
When something looks too good to be true, most of the time it isn’t. Likewise, those who were enthusiastic about the recent price spike of 4Cable TV International Inc (OTCMKTS:CATV) and believed it will soar much further, had their expectations clipped severely. Yesterday CATV came crashing down and lodges itself back under a penny.
By the closing bell CATV was sitting at $0.0094 per share, a whopping 56.8% below its previous close. The fact that the ticker jumped from the lower end of double zeroes to two cents per share without any reason for such movement – no PR, no filings, no positive news – should have probably served as warning to easily excitable traders.
There was a new filing in CATV‘s feed yesterday – a Schedule 13G disclosing Typenex, through another entity, held 9.99% of the company’s common stock, at 5 million shares. The important part here is that were it not for a contractual cap that limits ownership to 9.99%, Typenex’s ownership “would exceed such cap”, which means there’s more shares to issue and dilute once Typenex sells enough of its current block.
CATV‘s list of notoriously toxic financiers includes JMJ Financial and LG Capital. The company’s latest quarterly reveals that over the last six months CATV issued convertible notes that can be turned into shares at discounts reaching as high as 45% of the lowest closing price, a number of days before conversion.
Where CATV is headed from this point on and whether there will be more wild, volatile swings in price before things settle down remains to be seen.
Yesterday Genesis Electronics Group Inc (OTCMKTS:GEGI) gapped up at the opening bell, soared to incredible intra-day highs, then cooled off significantly and still ended the session a stunning 200% in the green. The reason for the price spike was a news release dropped by the company around the opening bell yesterday.
GEGI announced it entered an agreement for $2.5 million in new financing, to be obtained from a mysterious, unnamed “private individual”. Naturally, the company secured this financing through a convertible note. The conversion provisions and possible discounts associated with it are not mentioned in the press release. With GEGI being a pink sheet enterprise, there’s not going to be an 8-K detailing the deal.
In fact, there are a great many things that are missing about GEGI. The company is stamped with the red STOP sign on OTC Markets, is labeled as Dark or Defunct / Pink No Information and has not submitted a single report since its quarterly for the three months ended June 2014. In a nutshell, traders have been kept in the dark for about a year now and have no real way to get up-to-date information on the company outside of its own PR.
- $516 in cash
- $1.4 million in current liabilities
- ZERO in revenues
- $43 thousand in net loss
So, basically GEGI was nearly broke, was not making a dime in revenues and stopped reporting a year ago. The $2.5 million financing and the first $500,000 allegedly already received by the company will go towards GEGI‘s operations in a mining property in Nevada. This would all be very exciting indeed if any of it, including the lease and mining agreement signed by GEGI in March 2015, were described or even mentioned in a formal, official public filing but sadly, this is not the case.
Dominovas Energy Corp. (OTCMKTS:DNRG) had an amazing jump once it managed to attract the investors’ attention through boastful PR and promises of a bright future – but now that the hype around it has dissipated, it seems that all that the ticker can do is crash.
True, DNRG talked big – multi-megawatt agreements with the Democratic Republic of the Congo, contracts that are to bring more than $100 million in “guaranteed revenues” and other such glamorous future achievements were mentioned.
However, any due diligence seems to cast a dark shadow of doubt on the bright and colorful picture that DNRG has painted for investors. For instance, the company’s latest quarterly report for the period ended February 28, 2015, yields the following horrible numbers:
- NO CASH ON HAND!
- Prepaids – $15 thousand
- Convertible debt – $330 thousand
- Current Liabilities – $1.1 million
- Net loss – $228 thousand
Suffice it to say that these do not look like the figures of a company that is soon to have hundreds of millions worth of revenue. No, they look like the filings of you everyday mediocre OTC Markets penny stock company – and the worst part is, that they’re not the only thing that makes DNRG look suspicious.
Said financial report also contains information on DNRG‘s outstanding debt. That information does not present the company in a flattering light either, as it details convertible notes issued to to Kodiak Capital Group worth approximately $330 thousand that can currently convert into common stock at prices of $0.0022 per share.
This being the case, it hardly surprising that DNRG is currently falling as hard as it is.
The company EMS Find Inc (OTCMKTS:EMSF) was formed just a couple of months ago through a merger between the publicly traded company Lightcollar, Inc. and the private entity EMS Factory Inc. The newly formed company’s business plan is to create a mobile platform designed to connect health care providers and consumers to a network of medical transport companies throughout the United States and Canada.
On June 23 the company announced that it has signed a Letter of Intent to acquire Page Out, an interactive platform designed to streamline the emergency response process in addition to providing “management with real time status on where and when team members are responding to emergency and dispatch.”
Everything sounds rather exciting but after even a cursory due diligence quite a lot of red flags start to crop up. The financials of Lightcollar, Inc. according to the latest financial report were simply atrocious:
• ZERO assets
• $90 thousand liabilities
• ZERO revenues
• $11 thousand net loss
What kind of resources EMS Factory brought to the newly formed company was supposed to be revealed in an 8-K form filed by the middle of June. Well, we are now a couple of days into July and there is still no sign of the promised 8-K filing. Not only that but EMSF actually failed to complete its annual report for the fiscal year ending March 31, 2015, and instead it filed a Notification of Late Filing. Now they have a 15-day extension in which to complete the report.
Despite the lack of information and the depressing financials of Lightcollar, Inc. EMSF managed to reach a high of $2.53 on June 9. Even after dropping by over 50% from those highs the stock still trades at $1.20 at the moment. The only reason such prices were registered by the ticker was the paid promotion carried out by the pump outfit The Moskowitz Report. EMSF were touted through a landing page but more importantly a hard mailer brochure was put into circulation. With a disclosed budget of $1.2 million it is quite obvious that someone was rather determined to create as much artificial hype around the stock as possible. But why?
Maybe because some people own 18.5 million shares that have a split-adjusted price of just $0.002 and who, thanks to the interest in the stock created by the pump, could easily dump their shares on the open market and walk away with million in gains.
The red flags don’t stop there though. In our previous articles we discussed the past of EMSF’s current CEO Mr. Steve Rubakh and we also showed you that the mobile platform developed by the company suffered some unexpected delays with the beta testing that was initially supposed to take place in early-2015 now being postponed.
Trading EMSF’s stock is incredibly dangerous. The multitude of extremely serious red flags simply demands the use of caution before you put any money on the line. You might also want to take a look at the performance of some of the previous picks of The Moskowitz Report – Falconridge Oil Technologies (OTCMKTS:FROT) and Virtus Oil and Gas Corp (OTCBB:VOIL).
On June 17, Blue Sphere Corp (OTCMKTS:BLSP) released some good news. First, they said that they are about to kick a share repurchase plan into motion as a part of which they will buy $500 thousand worth of shares and cancel them. The management team said that this reflects their confidence in the company’s short- and long-term success and they also pointed out that, in their opinion, the stock is currently undervalued. They also announced that they have started constructing two waste-to-energy facilities which are supposed to bring around $6 million in revenues before the end of the year.
Investors didn’t really react at first, but about a week after the press release, they started jumping in. In a matter of a few short days, BLSP ran from less than $0.02 per share all the way to just under $0.04, but unfortunately, the climb seems to have come to an end. The ticker first slipped on Wednesday when it lost about 8%, but yesterday, it outright crashed, wiping out 40% of its value and closing the day at $0.021.
Pinpointing the reason for yesterday’s drop is not really that easy. There were no new filings, press releases or promotions that could have put pressure on the ticker, but the truth is, if you do your due diligence, you’ll see that apart from the management team’s words of optimism, there isn’t a whole lot to keep BLSP afloat, either.
Take the company headquarters as an example. BLSP likes to call itself “an international company active in the fields of organic waste to energy, cleantech and energy”, but the residential house that it uses as location for its principal office doesn’t really befit this description.
The latest 10-Q is not exactly stellar, either. Here’s what BLSP had to show for itself at the end of March:
- cash: $374 thousand
- current assets: $515 thousand
- current liabilities: $1.4 million
- NO revenue since inception
- quarterly net loss: $1.8 million
Of course, if the management team achieve the revenues they promised, and if the operations turn out to be profitable, things might start to look a little bit different. Shareholders won’t know whether that’s the case for another few months, however, and in the meantime, they need to think about something else.
As the share repurchase program would suggest, BLSP has gone through quite a lot of dilution over the last few months. Between January 13 and May 14, for example, the number of issued and outstanding shares grew from just over 51 million all the way to more than 83 million. Some of you will probably say that this is not such a big deal. BLSP‘s supporters will most likely argue that virtually all penny stock enterprises dilute their shareholders to some extent and they’ll note that with some of the newly printed shares returned back to the treasury, things might not be that bad.
Sadly, the number of issued and outstanding shares isn’t the only problem. The reason for their issuance is niggling us as well. During the second half of 2014, BLSP sold a total of $1.5 million worth of convertible notes and in January, they borrowed a further $360 thousand under similar agreements. The notes carry a conversion feature which allows the note holders to turn the debt into stock at discounts ranging from 37% to 45%. As a result, during the first three months of the year, around 10 million shares saw the light of day at an average rate of less than $0.06 per share. By contrast, BLSP spent most of the first calendar quarter comfortably above the $0.10 per share mark.