{"id":7692,"date":"2015-12-10T15:02:06","date_gmt":"2015-12-10T15:02:06","guid":{"rendered":"\/?p=7692"},"modified":"2015-12-10T15:14:59","modified_gmt":"2015-12-10T15:14:59","slug":"toxic-debt-ridden-wisdom-homes-of-america-inc-otcmktswofa-takes-off","status":"publish","type":"post","link":"\/articles\/toxic-debt-ridden-wisdom-homes-of-america-inc-otcmktswofa-takes-off\/","title":{"rendered":"Toxic Debt-Ridden Wisdom Homes of America Inc (OTCMKTS:WOFA) Takes Off"},"content":{"rendered":"\n<p><img loading=\"lazy\" decoding=\"async\" style=\"float: right;\" src=\"\/\/s.hotstocked.com\/hotstocked.com\/repository\/articles\/92\/92254\/wofa.png\" border=\"0\" width=\"400\" height=\"178\" \/>Nine months ago, Wisdom Homes of America Inc (OTCMKTS:<a href=\"http:\/\/www.thehotpennystocks.com\/Stock-Quotes\/?stock=WOFA\">WOFA<\/a>) was traded at around $0.17 per share. Last week, it bottomed out at $0.0005. Not what you&#8217;d call a solid performance. Let&#8217;s take a look into some of the reasons for it. <\/p>\n<p>The whole year took off on the wrong foot for the company. Treacherous weather conditions during the final quarter of 2014 and the first months of 2015 meant that <strong><a href=\"http:\/\/www.thehotpennystocks.com\/Stock-Quotes\/?stock=WOFA\">WOFA<\/a><\/strong> logged no meaningful revenue during Q1. Then, the skies quite literally cleared up and allowed <strong><a href=\"http:\/\/www.thehotpennystocks.com\/Stock-Quotes\/?stock=WOFA\">WOFA<\/a><\/strong> to end Q2 with some rather impressive sales. The management team were so excited about the way things were going, that they said that they&#8217;re on track to reach a target of $4 million in annual revenues for 2015. They appear to have spoken too soon.<\/p>\n<p>On November 23, the report for the third quarter came out and it brought some disturbing news. Here&#8217;s what the 10-Q showed:<\/p>\n<ul>\n<li>cash: $2,497<\/li>\n<li>current assets: $2,451,126<\/li>\n<li>current liabilities: $3,899,835<\/li>\n<li>quarterly revenue: $72,725<\/li>\n<li>quarterly net loss: $589,659<\/li>\n<\/ul>\n<p>The statement looks pretty underwhelming in almost every aspect, but the biggest cause for concern is the revenues. They have dropped by about<strong> 79%<\/strong> on a year-over-year basis and by a whopping <strong>94%<\/strong> sequentially. Unlike the Q1 report, the one for the third quarter gave us no explanation for the appalling sales figures.<\/p>\n<p>And while the revenues seem to be falling down, the O\/S count appears to be going up. At a massive rate at that. In fact, it went from <strong>just over 50 million<\/strong> at the beginning of the year all the way to <strong>77 million<\/strong> at the end of Q3. By November 14, however, it had grown to<strong> more than 146 million<\/strong>.<\/p>\n<p>As you might have guessed from our article&#8217;s headline, the appalling dilution was triggered by the mountains of convertible debt <strong><a href=\"http:\/\/www.thehotpennystocks.com\/Stock-Quotes\/?stock=WOFA\">WOFA<\/a><\/strong> has acquired over the years. At the end of Q3, the amount owed under the convertible notes stood at nearly <strong>$1.7 million<\/strong> and between September 30 and November 23, an undisclosed portion of it was turned into <strong>more than 71 million shares<\/strong>. When we wrote about the company in October, we touched upon the notes that are convertible<strong> at a 42% discount<\/strong> to the market price and we tried to warn our readers about the potential problems this could cause. Now, the effects seem to be pretty evident. But what will happen next?<\/p>\n<p>Well, as you might have also guessed from the article&#8217;s headline, <strong><a href=\"http:\/\/www.thehotpennystocks.com\/Stock-Quotes\/?stock=WOFA\">WOFA<\/a><\/strong> had an interesting session yesterday. It bounced out of triple-zero land and after an impressive 62% run, it stopped at $0.0013 per share. That&#8217;s not bad, but the worrying thing is that the jump wasn&#8217;t caused by anything immediately obvious. There were no press releases, SEC filings, or paid promotions that could have triggered the run which means that the short-term performance could be quite unpredictable. Unfortunately, the same can also be said about the longer term.<\/p>\n<p>Recently, the company raised the number of authorized shares <strong>from 300 million to 900 million<\/strong> and it picked up yet another convertible note which could mean that the dilution is far from over. As you probably know, <strong>a reverse split<\/strong> is supposed to be effected within the next twelve months as well, and it could put the shareholders in an even more unpleasant situation. That&#8217;s why, proceeding with caution is essential.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Nine months ago, Wisdom Homes of America Inc (OTCMKTS:WOFA) was traded at around $0.17 per share. Last week, it bottomed out at $0.0005. Not what you&#8217;d call a solid performance. Let&#8217;s take a look&#46;&#46;&#46;<\/p>\n","protected":false},"author":4,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[1897],"class_list":["post-7692","post","type-post","status-publish","format-standard","hentry","category-news","tag-wofa"],"_links":{"self":[{"href":"https:\/\/articles.thehotpennystocks.com\/articles\/wp-json\/wp\/v2\/posts\/7692","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/articles.thehotpennystocks.com\/articles\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/articles.thehotpennystocks.com\/articles\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/articles.thehotpennystocks.com\/articles\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/articles.thehotpennystocks.com\/articles\/wp-json\/wp\/v2\/comments?post=7692"}],"version-history":[{"count":0,"href":"https:\/\/articles.thehotpennystocks.com\/articles\/wp-json\/wp\/v2\/posts\/7692\/revisions"}],"wp:attachment":[{"href":"https:\/\/articles.thehotpennystocks.com\/articles\/wp-json\/wp\/v2\/media?parent=7692"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/articles.thehotpennystocks.com\/articles\/wp-json\/wp\/v2\/categories?post=7692"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/articles.thehotpennystocks.com\/articles\/wp-json\/wp\/v2\/tags?post=7692"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}