Terra Tech Corp. (OTCMKTS:TRTC) Headed Up Again
Terra Tech Corp. (OTCMKTS:TRTC)’s last hiccup cost it 8% of its market value last Thursday. The company more than recovered on the next day, climbing all the way up to $0.555 on news on the latest marijuana developments.
On first glance it is obvious why news on the initiative to restricting DEA access to funds for busting state sanctioned medical marijuana providers would send TRTC stock soaring. After all TRTC is traded as a pot-stock, and many investors consider it one of the most prominent companies in the sector. However, the fact remains that, to date, the company is yet to make a single dollar out of marijuana.
TRTC doesn’t even have a license to grow pot, so logic dictates that legalization developments should not have had such an immediate and dramatic impact on its stock prices. Once more, investors are given a clear example how hype and hope can turn any news into volatility while logic and facts are pushed to the background.
Still, the fact remains that TRTC has been growing pot herbs and making some revenues out of it, but produce is hardly the product that pushed the company’s market cap all the way up to a ridiculous $100 million.
Such a high market value is unrealistic for a number of reasons, the first and foremost of which can be found in the company’s latest 10-Q:
- cash – $2.9 million
- current liabilities – $6 million
- revenues – $560 thousand
- net loss – $4.9 million
The company boasted that the $560 thousand in revenues are a phenomenal jump year over year, but a closer look reveals that this number is actually inferior to all quarterly revenues reported after TRTC started selling Edible Garden produce. This fact, combined with TRTC‘s $4.9 million net loss may mean that the company is once more in decline, which would not bode well for TRTC at all.
Investors may want to take these, as well as all the other red flags surrounding the company, into consideration when making up their mind about committing to TRTC stock.
Another marijuana company that managed to jump by the end of last week is mCig Inc. (OTCBB:MCIG), whose market price rose 7.05% on Friday.
