New Generation Consumer Group Inc. (OTCMKTS:NGCG)’s Stumble Turns Into A Crash

New Generation Consumer Group Inc. (OTCMKTS:NGCG) managed to lose a whooping 22.50% of its market value yesterday, on a dollar volume of $606 thousand.

While this abrupt and dramatic crash is certainly not pleasant for the company’s devout supporters, it was in no way surprising or, to be honest, all that difficult to foresee.

As we mentioned before, the company’s dilution shenanigans are staggering even by the exceedingly lax standards of the OTC Markets. It could very well be said that toxic debt virtually obliterated investor value on more than one occasion in the not so distant past.

Even superficial due diligence that on Oct. 2014 NGCG, along with many other drastic changes, performed a 1 for 1,000 reverse split.

After said split took place, NGCG had 1.6 million shares outstanding.

Just one month later, the company’s Dec. 31, 2014 filing noted that the number of SO was already 56 MILLION.

Now, NGCG‘s OTC Markets profile shows that as of February 4, 2015 the company had 484 MILLION shares outstanding. A more current statistic is unavailable for the moment, but is clear that if the company is still issuing stock at the rate it has been doing in the past, investor value is in big, big trouble.

In light of such crushing dilution, prudent investors should have been wary of a dump. Whether that’s precisely what happened or shareholders just suddenly lost faith in NGCG is anyone’s guess, but one thing is certain.

In spite of NGCG‘s slightly reassuring, if extremely modest, financials the company is currently an extremely risky investment.

Another company in the hemp-infused beverages niche named Totally Hemp Crazy (OTCMKTS:THCZ), made significant market cap gains yesterday, jumping no less than 10% up the charts.