Pumpers Fail to Excite AppYea Inc (OTCMKTS:APYP)

At first glance, everything seems to be going well over at AppYea Inc (OTCMKTS:APYP)’s camp. On October 9, for example, the company announced that its new suite of gaming apps has been approved by Apple. A few days later, Jackie Williams, APYP‘s CEO, appeared on Small Cap Voice (who have received some shares and some money for investors relations services) and spoke about potential acquisitions. At the end of last month, he proudly announced that AppYea has bought no less than thirty-two applications available on the three major mobile platforms.

It all looks jolly exciting, but as we all know, looks can be deceiving, and unfortunately, once you go through APYP‘s latest 10-Q, you’ll see that the picture it paints is nowhere near as bright as the one left by the press releases. The financials on September 30, for example, looked like this:

  • cash: $50,603
  • current assets: $1,022,801
  • current liabilities: $524,399
  • quarterly revenues: $386
  • quarterly net loss: $1,289,366

The people behind Damn Good Penny Picks and Stock Mister received a grand total of $24 thousand in order to keep quiet about the figures you see above. Instead of commenting on the pitiful financials, they sent out a few emails and urged their subscribers to jump in.

When it comes to trading volume, the pump worked. In a matter of six and a half hours on Friday, investors traded around 25 million shares which is more than thirteen times the 30-day average. Performance-wise, however, the campaign was nothing short of a flop. The gap up at the beginning was promising, but APYP simply couldn’t hold on to the levels above $0.006 and it quickly came down. At $0.0056, the close was green, but if you take a look at the intraday chart, you’ll see that the ticker actually spent most of the session below Thursday’s value, giving investors very little chance to profit from the pump.

Those of you who have taken the time to read through the latest 10-Q won’t be too shocked by this because they know that APYP has had some serious toxic debt problems. As is often the case with penny stock companies, the notes are convertible into shares at a 45% to 50% discount to the lowest trading price recorded during the previous 20 to 60 days.

As a result, on September 21, when APYP‘s market value stood at $0.03 per share, the company issued nearly 1.5 million shares at $0.0065 apiece. Also as a result, between September 30 and November 16, APYP‘s printing press chucked out almost 16 million shares as a conversion of debt at an average rate of $0.0016.

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