Alkaline Water Co., Inc. (OTCBB:WTER) Slides Below 50 Cents

For the past few weeks, the Alkaline Water Co., Inc. (OTCBB:WTER) was safely above the 50-cent levels, but more active selling on Monday depressed the ticker further. WTER slid down more than 10% to 45 cents, on dollar volumes above $668,000. The slide came after news that finally the company placed some of the new convertible Series B shares it had promised in a recent press release.

Along with this, WTER issued three types of convertible shares, A, B and C, with different conversion prices. The B series converts the lowest, at 43 cents, and the rest at 55 cents- an encouraging sign, given that penny stock companies tent to issue toxic instruments that guarantee to convert at a faction of the market price. In the case of WTER, it will take a while to see the effect of the financing, yet the warrants mean that the holders would have an interest in boosting the stock price through good governance.

In the case of WTER, the new year will be a deciding factor, as this is the period when the new production should materialize, and sales should pick up. While WTER announced it was included in the distribution chain of many suppliers big and small, this was only to create a temporary boost for the shares.

The light at the end of the tunnel for WTER is that despite the $3.5 million promotion, the fallout stalled with just 50% losses, for now. But if the company keeps testing the patience of investors, the new low price may not be the bottom.

The WTER message is being reposted on investors’ forums every day, mainly touting the benefits of alkaline water. This product is usually a high-end offering, and WTER has entered the market with bigger packaging and a much lower price.

Now, WTER will have a week leading up to the 10Q posting, announced for November 14th. Investors’ opinions still hold that WTER will not last, and will slide further after showing no progress on its financial report.

If you want to ride a company that is breaking out now, you may try the Nevada Gold Corp. (OTCBB:NVGC), which reached 32 cents on accelerated buying.

But if you want to see the other side of the coin, Montalvo Spirits, Inc. (OTCBB:TQLA) is the sad example. The ticker held out the 30-cent levels for a while, and even gave hopes of recovery, but in the past week accelerated the slide to 25 cents. TQLA is a company of relative quality on the penny stock markets, yet its shares were also disproportionately inflated by a wide promotional campaign.

If you still see buying opportunity, it is best to be aware of all the red flags around WTER, and invest accordingly.