SK3 Group, Inc. (OTCMKTS:SKTO) Slides As Marijuana Hype Slows Down
Ever since the first sale of marijuana for recreational use took place in Colorado more than two weeks ago investors have been in a state of buying frenzy. All pennystock companies even remotely connected to the industry were pushed up sky high reaching share prices entirely disconnected from their underlying fundamentals. And despite going through several harsh pullbacks the gathered momentum was holding strong, at least for now.
The previous corrections all happened at the end of the week and the stocks immediately recovered on the next Monday. This week seemed to follow the trend to the letter with GreenGro Technologies, Inc. (OTCMKTS:GRNH) adding 114% to its value and reaching close to 50 cent per share. Growlife, Inc. (OTCBB:PHOT) more than recovered its losses by jumping up 33% and closing the day at $0.29. As we wrote in our previous article SK3 Group, Inc. (OTCMKTS:SKTO) were not an exception and surged by 44%.
But now the hype might be starting to subside as in a stark contrast to last week the industry slid down on the very next day. SKTO were able to avoid the fate of some of the other pennystocks in the sector and remained relatively stable dropping just 1.3% to $0.022 but still that is considerably lower than the opening price of $0.025. In early trading today things are not looking much better with GRNH and PHOT down by 3% and SKTO retracing its steps upwards after a 12% slide.
IF the pot-bubble is really starting to burst it will be up to each of the companies to try and support their currently inflated prices. And SKTO has a lot of red flags around itself. The company has reported millions and millions in revenues but it seems that they are unable to actually collect them. Close to $5 million are overdue by more than 180 days and $12 million are delayed by 90 days. Not to mention that just in the first nine months of 2013 the amount of outstanding shares nearly doubled from 361 million to 601 million as of September 30.
In the latest press release SKTO announced that they are seeking participants to test their new cannabinoid-base skin care products Dharmanol Topikoil and T-Hydrocan Topikoil. If through the sale of the Dharmanol product line the company finally generates revenues 
they can actually collect remains to be seen. For now though investors are advised to do their own research and never to jump into a stock based solely on the hype around it.
they can actually collect remains to be seen. For now though investors are advised to do their own research and never to jump into a stock based solely on the hype around it. 