NanoTech Entertainment, Inc. (OTCMKTS:NTEK) Remains Volatile
Last week the stock of NanoTech Entertainmet, Inc. (OTCMKTS:NTEK) made an abrupt change in its direction and suddenly started climbing the chart logging four sessions of gains in a row. On Friday the management team decided to boost the positive momentum behind the stock and issued a PR article which announced that their Nuvola NP-1 4k UltraHD Streaming media player has passed the Google Compatibility Test Suite (CST).
The announcement had such an enormous effect that in the remaining 2 and a half hours before the end of the session investors managed to exchange more than 15 million shares, a number that is nearly 5 times higher than the traded volume for the previous day. As a result of the buying frenzy NTEK surged upwards by 41% and finished the week at $0.077 per share. Despite the impressive performance though the company is still nearly 50% down from the highs posted just a couple of months ago.
On the financial side of things NTEK seems to be miles ahead of most of the other pennystocks. According to the latest quarterly report the company finished the first three months of the year with:
- $34 thousand cash
- $1.5 million total current assets
- $582 thousand total current liabilities
- $5.1 million gross sales
- $314 thousand net profit
As you can see the company has been able to maintain a positive bottom line and on April 4 even announced that they will be paying a quarterly cash dividend to their shareholders. So why is then the stock unable to make a prolonged run up the chart? Well, there certainly isn’t a shortage of reasons.
The company has been targeted by paid pumps in the past which is always a red flag. The Nuvola player was supposed to be available for new customer in the first quarter of the year but so for we are approaching the end of the second quarter and it is still not available. An even bigger issue is the fact that many of the people who pre-ordered the product still haven’t received it. Investors should also note that millions of shares issued as conversion of debt last year are at the end of their restricted period and could further depress the share price.
The volatility of the stock and the red flags around the company demand the use of caution. Be sure that any trades involving the stock are attempted only after careful consideration. In early trading today NTEK has already started crashing currently sitting 6% in the red at $0.71. The pumped stock of Windstream Technolog (OTCBB:WSTI) is also starting the week with a crash wiping more than 11% of its value in the first hour of today’s trading.
