American Heritage International Inc (OTCBB:AHII)’s Climb Continues

The public company that we now know as American Heritage International Inc (OTCBB:AHII) changed its name and ticker symbol back in September and it officially entered the e-cigarettes market. This was bound to cause a stir among investors since this particular industry is quite hot at the moment. As you can see from the chart, it has.

The market’s reaction wasn’t instantaneous, but once people heard about AHII, the price really started gaining ground. At the beginning of the year, the ticker was hovering between $0.70 and $0.80, but although the movement hasn’t been explosive, we’ve seen some remarkable performance over the last two months. AHII managed to break through the $1 per share barrier at the beginning of February and it hasn’t looked back. We have yet to see it register daily gains of more than 10% which is somewhat unusual for a penny stock enterprise that is working in a hot industry, but the slow and steady approach seems to be welcomed by many investors.

Volumes have recently started to pick up and a lot more people are now talking about the company. The outlook seems bright and although the ticker hasn’t logged a red session in more than two weeks, a correction is nowhere in sight. Early trading today suggests that the run might continue.

That’s a remarkably steady performance for a small cap enterprise, but is it really the result of the interesting business plan only?

Over the last few months, AHII have made some exciting announcements that have also given the stock a push in the right direction. On February 19, they said that they are expanding their retail presence into South America. Three weeks later, they informed us that the American Heritage e-cigs have hit the shelves of some stores in New York which should give the company quite a lot of exposure.

The PR action didn’t stop there. On Monday, they made an appointment to the management team and two days later, they told us that they have negotiated a placement of the e-cigs in “a select number of 7-Eleven stores in the state of Florida”. A couple of hours before today’s opening bell came another announcement. Apparently, the demand for AHII‘s electronic cigarettes is so high, that they’ve managed to sell out the inventory. Fortunately, they should receive another batch soon.

They have also addressed their financial issues. The press release tells us that a private placement has been completed which brought total proceeds of $500 thousand. The capital, AHII say, should help them meet the growing demand.

Without a doubt, the news is good. The expanding retail presence should bring in some much-needed revenues and the fresh proceeds from the private placement means that they now have one less thing to worry about. As an added bonus, the general public seems to like the product.

Once again, however, we’re not convinced that this alone is enough to propel the stock on such a consistent run. That’s because it apparently isn’t.

There’s a paid pump currently running for AHII and the increasing volumes suggest that more and more people are lured in by the minute. As we mentioned in our previous article, the promotion is carried out through a landing page, there’s a few email alerts and some hard mailer brochures have also been flying around. An entity called Rui Long has set aside a budget of more than $1.6 million and that is quite a big red flag in the world of penny stocks.

Some of you might argue that despite the promotion, AHII is an operating entity which should help the ticker weather all the difficulties. That might just happen, but then again, we’ve seen other relatively solid ventures getting the pump treatment and their performance has been less than perfect.

Fresh Healthy Vending International Inc (OTCBB:VEND), for example, became the target of a $1.8 million promotion. There were some paper mailer brochures flying around and the excitement was big enough to push the ticker up to an all-time high of $10.08 on February 25. Right now, three weeks later, it’s sitting at around $4 per share. At 40% lost in a little under two months, Konared Corp (OTCBB:KRED)’s performance is marginally better, but it’s still pretty disappointing.