What Happened After The Italk Inc (OTCBB:TALK) Pump
The most recent movements in the stock price of Italk Inc (OTCBB:TALK) can’t be compared to the massive drop of 40% at the peak of their pump campaign.
That doesn’t mean that the stock isn’t touted. The last promotional email that we received about TALK was on May 23, but it didn’t really make an impact. This is probably due to the massive dumping that we witnessed in the peak of TALK‘s pump campaign on May 14 when their stock traded in a volume of 14 million shares and generated a total trade value of over $17 million.
The trade value in the previous 2 days was also above the $10 million mark as they went for the $2 per share price. However, as we warned you in our previous article about TALK this promotional campaign gave no realistic information to investors and we know that a lot of people got burned when prices dropped 40% in just one day.
Let’s take a brief moment to look at the financial state of TALK and see if their market cap of over $42 million is backed up in the numbers of prime interest from their latest quarterly report covering the period ended February 28, 2013.
cash: $380
total assets: $380
current liabilities: $83 thousand
revenue since inception: $0
net loss: $23 thousand
We really can’t see what the reason for the hype and their price of over $1 is. It’s so obvious that at the moment they literally don’t have any business and that their products aren’t generating any income that we start to wonder how they managed to fool so many investors.
The most disturbing part is that the pumpers that are touting them are getting so oblivious in their effort to promote TALK‘s stock that they are even comparing them to Lot78 Inc (OTCMKTS:LOTE), a company that is not even in the same sector as TALK.
However, we can see where things are going. At the moment the situation is a tipycal “calm before the storm” and we are guessing that the insiders paying for the promotional campaign are sharpening their teeth until most investors start to forget about the dumping that took place on May 14.
We expect a continued pump effort which will most probably climax in another dumping fiasco which would be aided by the company’s press releases. The latest press release that they made was concerning an arrangement between TALK and ESPN Deportes to conduct a multi-phase advertising campaign for the company’s iData 4G mobile broadband hotspot service.
We don’t really get any information about the state of the negotiation, but we can’t imagine how a company whose sole assets are $380 is going to advertise on ESPN Deportes a product which is also under question.
You might ask why we question TALK‘s product. It’s simple. There is no way a company with $380 cash on hand can build a network to support a mobile broadband hotspot service. The only chance they have for doing that is by finding investors. So far such news are not coming in.
All in all TALK is a risky investment choice for most traders, however, experienced investors might make a profit. Before taking an investment decision about TALK be sure to do your due diligence and weigh out all the risks.
