Ascent Solar Technologies, Inc. (OTCMKTS:ASTID) Bounces
At the start of the month Ascent Solar Technologies, Inc. (OTCMKTS:ASTI) implemented a 1-for-20 reverse split that reduced their outstanding shares down to approximately 17 million and pushed their stock to a June 2 opening price of $0.59. Since then, however, the chart performance of the stock has been truly abysmal.
The ticker began sinking like a stone and went on to form a downtrend of 11 sessions with only a single one ending in the green. Last Thursday the stock registered an intraday low of $0.068. This week is starting a lot better, though.
After wiping around 88% of its value following the reverse split ASTI were finally able to bounce back up and to recover at least some of their losses. During the trading day the ticker went as high as $0.116 per share and although such prices proved to be rather short-lived the company still closed above 10 cents at $0.104 for a massive daily gain of 38.7%.
The performance was indeed extremely positive but there is one rather serious problem – it wasn’t supported by anything. Not only were their no new PRs or filings that could sustain the momentum but the latest information coming from the company has been rather alarming. On April 29 ASTI entered into a $2 million securities purchase agreement for the sale of 2000 of its newly designated Series G Convertible Preferred Stock. The Series G shares have a pre-split fixed conversion price of $0.05.
A little over a month later, however, ASTI announced a new purchase agreement. This time the company is going to raise $2.5 million by selling yet another newly designed series of preferred convertible stock – Series H. These shares, unlike the Series G, do not have a fixed conversion price and can be turned into common shares at a 30% discount. If certain “Triggering Events” occur the conversion price will feature a 40% discount. With the authorized shares of the company staying unaffected by the reverse split at 450 million there is plenty of room for such conversions.
Some investors are hoping that ASTI might soon announce their preliminary results for the second quarter of the year and that this could be enough to help the stock form a more prolonged recovery. While ASTI‘s revenues have indeed been growing as a whole their last couple of reports have failed to inspire much confidence. The company finished the quarter ended March 31, 2016, with:
• $350 thousand cash
• $9.7 million total current assets
• $15.1 million total current liabilities
• $710 thousand revenues
• $10.5 million net loss
The red flags surrounding ASTI shouldn’t be overlooked and any trades involving the stock must be preceded by extensive due diligence.
