Writ Media Group Inc (OTCMKTS:WRIT) Jumps Up
tags: WRIT
Less than an hour before the closing bell of yesterday’s session the stock of Writ Media Group Inc (OTCMKTS:WRIT) was sitting at its lowest point for the day of $0.55. Thanks to an impressive surge, though, it not only managed to recover its losses but actually climbed to a close at 83 cents per share for a gain of over 15%. Can the jump up the chart be attributed to the PR that WRIT issued yesterday?
While the press release undoubtedly influenced the performance of the stock it seems unlikely that it was the catalyst for the last minute recovery – the PR was published at the start of the session and contained little more than fluff. In it WRIT announced that they have plans for the integration of their recently launched Pelecoin Blockchain technology into products and applications that will make spending digital currencies as easy as spending dollars.
No, a far more likely explanation for the positive end of the session and WRIT‘s ability to even reach a market cap of $21 million is the artificial hype created by the paid pump that has been touting the company for the past weeks. The newsletters involved in the promotion are the affiliates of Finest Penny Stocks. WRIT themselves have also decided to spend some money in order to hype their stock – they have paid $16 thousand and 40 thousand restricted shares to Quality Stocks for 6 months of investors relations and social media services.
Without the pump WRIT will have a rather difficult time maintaining their market cap. After all, the company did finish the three months ended December 31, 2015, in an abysmal financial state with:
• $264 cash
• $879 total current assets
• $888 thousand total current liabilities
• ZERO revenues
• $120 thousand net loss
Thanks to a notification of late filing submitted on June 29 WRIT received a 15-day extension for the completion of their annual report. That period ends in a couple of days and if the report gets filed investors will finally see what WRIT‘s balance sheet looked like at the end of March 31, 2016. The report will also reveal the current amount of outstanding shares of the company. Last July WRIT performed a 1-for-200 reverse split and as of December 14, 2015, they had 2.3 million shares. By the end of February 2016 that number had increased tenfold to 25 million shares.
The pump could indeed allow the more opportunistic traders to walk away with some quick gains but the risks are far too serious to be underestimated. If you miss the right timing the losses could be devastating.
