BioNovelus, Inc. (OTCMKTS:ONOV) Suffers Another Crash
From a little over 1 cent to a high of more than 18 cents in just a couple of weeks – that was the chart performance of BioNovelus, Inc. (OTCMKTS:ONOV)’s stock. The impressive uptrend didn’t have a lot supporting it but the enthusiasm displayed by investors proved to be enough.
Hype can only last for so long, though, and with ONOV reaching some truly unsustainable prices a reversal was more and more likely. Indeed, after climbing to its current highs during the June 20 session the stock lost its footing and has been wiping huge chunks of its value for the past three sessions. Yesterday it crashed by 15.4% closing the trading day at $0.11.
On Wednesday ONOV did try to reinvigorate investors by publishing a new PR. Apparently 4,000 bottles of the company’s biodegradable fungicide, CR-10, which the company describes as the answer to the coffee rust fungus, have been manufactured and are going to be shipped to Costa Rica. The produced bottles of CR-10 are going to be used in the ongoing tests conducted by the company’s partners. The PR also reminded investors that there potentially are more than 2.5 million hectares of coffee plantations spread across Central America as well as Mexico and Colombia that are suited to be treated with CR-10. The press release failed to prevent ONOV from dropping further down the chart but at least on that day the stock avoided logging in a double digit loss finishing the session 9.7% in the red.
If the company is making progress with its plans what could be the reason for the stock’s rapid decline? Well, you don’t have to look for long in order to find an answer – just open the latest quarterly report filed by ONOV. It covers the first three months of the year and shows that as of March 31, 2016, the company had:
• $4 cash and total current assets!!!
• $681 thousand total current liabilities
• ZERO revenues
• $25 thousand net loss
On June 17 ONOV announced their intentions to become a fully reporting company but for now we are left to rely on their reports filed under the alternative reporting standards. What we do know is that at the end of March ONOV had approximately $154 thousand worth of outstanding convertible notes with “various due dates in 2016”. Last year a total of 13.2 million shares were issued as a conversion of notes.
If the hype around ONOV continues to wane the company could find itself falling closer to its previous price ranges. That is why before jumping into any of the various pennystocks out there you should always do extensive due diligence.
