QED CONNECT, INC. (PINK:QEDN) and PennyStockRumor are Stuck for Ideas

If you work with penny stock companies you will see hundreds of ventures that start out, for example, in the gold mining business, then they decided that they would like to produce movies, after which they find themselves working in the bio-medical industry and after years of not succeeding in any of the sectors, they simply quit. QED CONNECT, INC. (PINK:QEDN) have taken on a different approach.

Instead of changing their business every other week, they proclaim themselves as a venture which seeks small profitable companies, which to acquire and to keep their revenue. That’s what they say anyway.

There are numerous press-releases coming out of QEDN‘s headquarters telling us what their next big joint venture or acquisition will be. Basically once you have read one of them, you can guess what’s coming in the next one. In most cases, the companies about to be acquired by QEDN are small Russian or Ukrainian mineral or oil and natural gas exploration companies, that are supposed to bring in millions in revenue. The thing is, according to the news coming out of QEDN, they have not actually taken control over those companies, but rather, they have signed letters of intent to do so, which is quite different. The easiest way to find out what they actually have is to open the financial report and it doesn’t take long to see that currently QEDN are tight for cash (putting it extremely mildly). Here’s a recap of the most important figures in the statement:

• cash: $288
• current assets: $25 thousand
• total liabilities: $3.2 million
• no revenue
• net loss for Q1, Q2 and Q3 of 2012: $209 thousand
• accumulated deficit: $4.6 million

QEDN‘s troubles don’t end with the financials, either. The whole report sounds extremely depressing, but, more importantly, it confirmed our doubt that they have not completed the acquisitions referred to in the press-releases and in StockRumor’s email. Instead, as of September 2012, they had 1 (one) operating subsidiary – stockprofile.com. We checked it out and it suspiciously reminds us of a promoters’ website. They have even disclosed the compensations received for the advertisements on some companies. What is strange, however, is the fact that these compensations are not reflected in the financial statement.

At the time the report was filed, QEDN had another subsidiary. It’s called Nazz Productions and, as the name would suggest, it deals with the production of Hollywood movies, or at least that’s what they say. If you plan to search any sort of information about movies, your first step should always be the geeks’ heaven on earth (also known as IMDB). To our surprise we managed to find Nazz Productions in there. It would seem that they have taken part in the production of three movies. Just when we thought that we have found something that could be positive about QEDN, we saw that all the movies were completed long before Nazz was acquired. And the future? Well, Nazz’s website doesn’t work anymore so it doesn’t look too good. So much for the millions of revenue from Hollywood movies flowing towards QEDN‘s treasury.

The pumpers and the press-releases also mention another company that QEDN have supposedly acquired – Sofame Energy. The newsletters say how big the potential of their technology is and how they sold Hybrid Percomtherm boiler (whatever that means) to somebody, but the report clearly states that QEDN have defaulted on their obligation towards Sofame, which means that for now, at least, QEDN won’t see even a penny from Sofame.

This is not the first time QEDN have defaulted. Back in 2009 they a lawsuit was filed against them by the company who sold them some computer equipment (we admit, we laughed a little here). Apparently QEDN could pay the lease and a judge forced them to pay around $26 thousand.

Another blow to the company credibility is the promotion taking place around them right now. PennyStockRumor are not known for boosting the companies that they promote in the long run. If you don’t believe us, you can ask LUDWIG ENTERPRISES (PINK:LUDG) how badly things can go. Or you can have a look at the chart on the right.