Advanced Medical Isotope Corp. (OTCMKTS:ADMD) Plunges For The Bottom Of The Chart
Yesterday, in just a single trade session, the stock of Advanced Medical Isotope Corp. (OTCMKTS:ADMD) lost a third of its value. The ticker opened at $0.0039 but by the time of the closing bell it had fallen to $0.0026 per share. The disastrous crash took place on a volume of 113 million shares which is more than four times higher than the monthly average. The last time the company registered bigger daily volumes was at the start of May.
The depressing performance was not caused by anything immediately obvious but that is not to say that ADMD are not surrounded by red flags. The last PR published by the company is now nearly two months old and the lack of up-to-date information could be starting to influence investors’ sentiment towards the stock.
ADMD’s financials fail to inspire much confidence, either. In fact, the last reported financial results of the company were absolutely atrocious. At the end of March ADMD had:
• $2485 cash!!!
• $31,760 total current assets
• $21.2 million total current liabilities
• $12,054 revenues
• $328 thousand operating loss
Would you believe us if we told you that the minimal cash resources and the massive even by pennystock standards working capital deficit of $21 million are actually not the biggest problem around the company?
ADMD has been financing its operations by issuing vast amounts of convertible debt. The toll on the outstanding shares has been tremendous – the O/S count grew from 121 million at the start of 2014 to more than 1.7 BILLION by the end of December. As of May 11, 2015, the company had 1.9 BILLION shares out of the 2 billion authorized. With a lot more notes still outstanding an increase of the authorized amount seems more than likely.
Earlier this year ADMD did try to improve their situation by restructuring the debt through a new agreement with their primary lender and the termination of $500 thousand in seasoned trade payables. The company has also taken steps to remedy an excess of shares that were erroneously issued back in November and December, last year, and if they are successful the potential reduction of the outstanding debt could be significant.
Despite all of the serious red flags the fate of ticker is going to be determined by the FDA. ADMD filed a de-novo submission for their Y-90 Radiogel device for marketing clearance. An answer was expected with 120 dates, period that ended yesterday, and the lack of news could be the reason for the crash. If any requests for further information have been made by the FDA that period could have been extended. Until an official answer has been announced the ticker will more than likely remain a highly volatile choice.
