Eco Trade Corp (PINK:BOPT) Break Down Under the Promotional Pressure
The last couple of trading sessions were not good for Eco Trade Corp (PINK:BOPT). It all started on April 10 when they wiped out a whopping 50% off their price. Then, on Thursday, they managed to claw some ground back up when we saw a 16% gain, after which Friday brought record volume and another 41% loss. So what’s the culprit?
If we look at it from a logical perspective, this shouldn’t have happened. BOPT have been spewing out press releases like there’s no tomorrow for the last couple of weeks and they all sound mightily exciting. The last one was published on Friday and it said that they have signed a letter of intent to acquire financing for their exploration projects. Looking at their financial statements, they really need the money and the news should have boosted the investors’ confidence through the roof. As we all know, however, penny stocks don’t always follow the logical path and the aforementioned 41% plunge took place leaving a lot of disappointed traders behind.
Speaking of which, the paid promoters are now in on the bandwagon as well and it’s somewhat strange how they are trying to convince us that a company with such dreadful financials is a good investment option. Here are the figures as of September 30, 2012:
- no assets
- total liabilities: $1.3 million
- no revenue since inception
- quarterly net loss: $22 thousand
But the pump is a fact and we’re continuing to receive emails about BOPT as we speak. All the promoters claim that a bounce is about to occur and that the potential for profit is huge. While such a thing is possible, nobody can be sure how long it would last.
Our bet is, BOPT will not be able to maintain a solid price in the long run and we have some very good reasons to believe this. For one, they have been around for quite a while now and we can see that they haven’t been able to achieve anything but accumulate huge losses and wonder about what their next name and business should be.
The latest venture as we mentioned is in the oil and gas exploration business and there has been quite a lot of commotion around BOPT ever since they started dealing with the supposedly lucrative wells in Montana. There were changes in the management team and the press releases have been regularly hitting the websites in an attempt to create the desired excitement around the ticker. The announcements are something that we’re quite used to when it comes to small cap oil and gas exploration companies. It looks like they are all using the same template and the only thing that they change is the name and the ticker of the company as well as the location of the projected millions of barrels of oil.
A change in the management team, however, is not that common, so we decided to check on the people who were and will be at the helm of BOPT. The person who was running the show until March 18 was called Mr. William Lieberman and while you can’t say that the company has been flourishing financially under his rule, he was the one who announced the acquisition of the oil wells in Montana. That said, we all know that press releases in Pennyland should not always be trusted and some companies like Fox Petroleum, Inc. (FXTP) get suspended every now and then because of doubts as to the legitimacy of their announcements.
We used FXTP as an example because Mr. Lieberman is actually a part of their management team, but that’s not the only publicly traded venture that he’s involved in. He is also the CEO of another small cap company – Mammoth Energy Grp (PINK:MMTE). Our database suggests that MMTE have been pumped a number of times with quite disappointing results and probably because of this, their shares have been traded at par value for quite some time now.
While Mr. Lieberman’s affiliation could be a cause for concern for some people, others will argue that he’s gone now and that there really is nothing to worry about anymore. But who took the helm?
That would be Mr. Canon Bryan. Of course, we had to do a quick check on him as well and we found that he was serving as CFO for a company called Cyop Systems Intl (CYOS) who were revoked by the SEC back in September, 2012 due to delinquency in the filing of their reports.
With all that in mind, we’re struggling to see how BOPT will manage to keep their head above the water for much longer, and while the promotional frenzy that will be created around them in the coming days might just yield a potential for profit, it will probably be all over before you know it, which is why you should be extremely careful when considering the risks of a potential investment.