AUCTIONS INTL INC (PINK:AUCI) Up the Ante
Another day, another promotion for a company that nobody has ever heard of. This time it’s AUCTIONS INTL INC (PINK:AUCI) and at first glance, at least, things don’t look so bad. Will the bright outlook remain once we dig deeper, though?
AUCI started off back in 2007 and their primary aim was to develop a software application which is supposed to revolutionize the way people organize auctions over the Internet. This sounds like a lucrative business opportunity, right? Well, it would have been if they had managed to finish it by now, but unfortunately that’s not the case.
This is probably why they are currently searching for new business sectors and they have turned to something altogether different – film production. Back in October they announced that they have signed a letter of intent to merge with a company called Rangemore Productions, who own some film studios on the Isle of Man in the Irish Sea. Rangemore say that they own some film studios on the Isle of Man in the Irish Sea, and they also claim that Hollywood stars like Jude Law have chosen these studios as filming locations for their next blockbusters. When the acquisition is completed, AUCI will be running the studio.
It all sounds extremely exciting and if you are to believe the press-releases that have been flying out of AUCI‘s headquarters, everything is going according to plan – the due diligence is done and they are now on their way to completing the formal acquisition. That said, they still have some things to do, like consolidating the two entities’ financial statements and we’re quite eager to see what the result will be. Especially when you consider the fact that AUCI‘s latest report is not exactly picture perfect. Here are the figures as of December 31, 2012:
- cash: $195
- current assets: $83 thousand
- current liabilities: $27 thousand
- no revenue
- net loss: $156 thousand
We have one more problem with the ongoing merger – although they keep pushing out press-release after press-release stating how lucrative this new direction could become, AUCI are quite reluctant to reveal any details on the deal that is about to take place, and we’re quite certain that the shareholders who have trusted AUCI with their money are keen to know how many shares will be issued for the acquisition. If the opportunity really is as good as they say it is, we reckon that their printing press will be working full time.
As always we also checked into AUCI‘s promotional history and we found that this is not the first time that newsletters are getting all excited about them. The last pump took place back in February 2011. Just like today’s campaign, the hype was also supported by a number of press-releases about a future acquisition of AUCI. Back then, we did the research and we found out that quite a lot of people were saying that the PR’s in question were simply not true. As we can see right now, the acquisition never took place which means that the headlines were indeed fake. Once investors discovered the truth, AUCI‘s price took a dive. We’re not saying that history is about to repeat itself, but it’s definitely worth keeping this story in mind when making your decision.
You should also be aware of the fact that we are, again, speaking about a penny stock that is featured in paid promotion. We all know how most of them fare once the hype is over. Crown Marketing (PINK:CWNM), for example, got pumped by roughly the same newsletters back around February 14. As you can see from the chart on the right, their stock has not been performing in the way that the pumpers predicted. On the contrary, the ticker continued with its downward trend.
