Daily OTC Markets Preview – 10.07.2013
Top Promoted Stocks: SRBL, PSON, SOUL
Yesterday, the major US stock indexes registered another positive trading session in a row. The OTCM ADR Index was also in tone with the rally of the benchmark indexes as it flew up 0.80% to 1,374.43.
Today the OTC Markets are going to welcome a couple of new stock promotions which may exert a lot of influence on the penny stock market. This is why we are going to take a look at the most important promotions which had been initiated since the last closing bell:
Great American Energy, Inc. (SRBL) – Today SRBL is on the front line of promoted stocks. The company’s stock symbol has been crowning the headlines of eight different newsletters. Some of the most influential promoters involved in this campaign are OTC Tip Reporter, Penny Stock Scholar, Small Cap Investment, Equity Trading Alert, all of which had been sponsored by Research Driven Investor LLC (RDI). RDI, on its part, disclosed that it had received a compensation of $30,000 by Lake Group Media Inc. for a one day investor relations campaign.
The campaign is yet to be supported by a press release by the company as SRBL hasn’t devised any news today. The latest press release by SRBL was issued on Jul 1st when the company announced the completion of a gravimetric survey on its Big Smoky Valley Lithium Project. However, this news didn’t impress penny stock players as on that day the stock went up only 2% on a much lower than average volume.
SRBL closed the last trading session 3% lower at $0.52 per share on a volume of 76 thousand which is three times lower than the monthly average. SRBL sock has been declining ever since it started trading in Feb this year.
Shortly after it made its initial steps on the market, SRBL hit a 52-week high at $1.34 per share but over the next couple of months the stock value plummeted dramatically. The downtrend of SRBL has intensified since April this year, when the stock broke below its major moving averages. Only last week did SRBL manage to surge above the 50-MA but this technical move was short lived as the next day the stock fell victim to another wave of strong selling pressure.
Yet, the company still holds a decent market capitalization of $46 million, which is not much of a consolation as it means that there is still room for SRBL to depreciate. In fact the market value of the company has been maintained mainly by speculations created by press releases about the company’s exploration endeavors.
At the same time SRBL doesn’t have the finances to justify its current valuation as the most recent financial report of the company shows that as of Mar 2013 it held:
- $113 thousand cash
- $98 thousand working capital and $1.3 million accumulated deficit
- $144 thousand net loss
The bearish mode of the SRBL stock may get accelerated after the current market awareness campaign if it turns out that the promotion is just another banal pump and dump scheme.
Petrosonic Energy, Inc. (PSON) – The Stock Junction, one of the regular promoters of PSON, has been busy today flooding investors’ inboxes with a newsletter, which is dedicated to PSON and compiled by Tobin Smith.
For this service the Stock Junction had been paid $41,020 by a third party whose name was not disclosed. Our readers might remember that on June 20th we reported another promotional attempt of the Stock Junction on PSON stock, which at that point had crashed severely and market players expected that PSON would receive some support after the market awareness campaign.
However, historic data shows that instead of supporting the stock, the promotion only exacerbated PSON’s plight as during that day the stock fell further down the charts. Since then PSON stock value has dropped even more and after another nail-biting session on Tuesday this week PSON plunged 10% down to $0.65 per share on a volume of 580 thousand.
Yet, the company still holds a decent market capitalization of $51 million, which means there is still more room for depreciation if investors decide not to believe in the pompous words of PSON’s promoters. At the same time, what catches the eye regarding the company’s financial reports is that PSON had reported at least some cash at hand in the last quarterly report, which may relieve the company in its efforts to realize its strategic plans.
Soul and Vibe Interactive Inc. (SOUL) – The next notable promotional campaign is dedicated to SOUL. In fact the campaign was initiated on Tuesday by a promoter called Jonathan Ledger who did not provide any disclosure about third parties and compensation.
Nevertheless, yesterday SOUL surged 14% to $0.275 per share on a five times higher than average volume of 554 thousand. Today the campaign continues but this time it has involved several additional promoters among which PST Alerts, Buzz Stocks, The Market Caliber Team and Penny Stock Prophet.
There are also two third parties in the campaign, namely Cambridge consultants and Galaxy LLC. The former had invested $30,000 in the campaign and the latter – $7,000.
Furthermore, the company has also tried to aid the market awareness campaign with a letter to Shareholders which was issued yesterday after the closing bell. Nevertheless, neither the corporate update nor the onslaught of paid newsletters appear to have won investors support for the stock as it currently trades 2% lower than the previous close on a five times higher than average volume.