Axiom Corp (OTCMKTS:AXMM) Taking On More Water
Investors first heard about Axiom Corp (OTCMKTS:AXMM) at the beginning of March – just days after the public company announced the completed reverse merger with a private Canadian entity called PaperNuts Corporation. They were immediately interested.
People were initially shooting in the dark because they still didn’t have the financial statements of AXMM‘s new operating subsidiary. Nevertheless, they were hoping for good results and they reckoned that once the figures are in, the stock will really take off. Investors were also delighted about the fact that PaperNuts received quite a lot of exposure a couple of years ago when some of the people behind the company presented their business plan during an episode of Dragons’ Den. Sadly, in reality, things weren’t quite as optimistic.
The first thing that suggested that something might be amiss is the aforementioned Dragons’ Den episode. Indeed, PaperNuts’ machines and packaging solutions were presented in an interesting way, and indeed, three of the “dragons” agreed to invest. A few minutes worth of research, however, reveals that the deal was called off during the due diligence process.
The second major red flag around AXMM was the paid pump that started mere days after the first active sessions. First, a landing page appeared and then Investor Edge started sending out some alerts through the email. The hype gave the ticker a rather strong boost initially, but the more experienced penny stock players knew that it could soon pose a massive threat for the overly hopeful investors. Especially considering the 26.4 million shares that were basically given away to a selected few in June 2012.
As if that wasn’t bad enough, AXMM‘s management team published PaperNuts’ financial results on March 12 and revealed that the business was far from flourishing. As we mentioned in some of our previous articles, the more recent SEC filings don’t suggest that things have improved.
Not surprisingly, after an initial run to a high of nearly $1.90 per share, the ticker crumbled and dropped all the way down to $0.14 in a matter of just over two months. Many people realized just how huge a mistake listening to the pumpers had been, and it looked like that would be the end of that. The promoters, however, had other ideas.
About a month ago, another $200 thousand was set aside for pumping AXMM and some of it was spent on advertisements that lead to a second landing page and a six-minute video which tells you that if you get in early, you could become very rich.
Despite the previous crash, some people did believe the new landing page and they pushed the stock to a peak of almost $0.50 per share. Unfortunately, things turned ugly once again which means that AXMM is currently falling down hard. And it’s taking quite a lot of retail investors’ money with it.
The last green session was registered on June 22 when the ticker finished the day at $0.375 per share. Yesterday, after a nasty drop, it closed at $0.0374. For those of you who are not that quick with the calculator, this means that AXMM lost 90% of its market cap in a matter of just nine days.
On June 15, the management team decided that if they can’t salvage the stock, they can at least try to keep some of their reputation intact and they announced publicly that they have nothing to do with the pump campaign for AXMM. That’s probably true, but it won’t stop the people who got the aforementioned 26.4 million shares from chucking them on the open market and walking away with the profits.
