BioSolar Inc (OTCMKTS:BSRC) Smashes Through the $0.50 Mark

Some of the long-term shareholders now admit that they didn’t have much confidence in BioSolar Inc (OTCMKTS:BSRC) a couple of weeks ago. They say that they expected to see the stock plummet all the way down to $0.0001 and get reverse split. Currently, they feel quite a bit different.

And with good reason. BSRC‘s recent performance has been nothing short of astonishing. The ticker first saw some volume on June 16 when it was sitting at just $0.07. Right now, a little over two weeks later, it’s pegged at a hair under $0.52. Yesterday BSRC also reached a 52-week high of $0.54 and by the looks of things, the liquidity problems it was experiencing up until mid-June are now gone.

The reason for all the commotion consists of a single press release that hit the wire a couple of weeks ago. With it, BSRC announced that they are in the process of developing a cheaper, more powerful, faster-charging lithium-ion battery that will double the range of a Tesla automobile and will reach the $100/kWh cost barrier which is considered something of a holy grail in the industry. The management team told us all about how the battery will work, but they somehow forgot to say when they expect to be ready with it.

So, basically, BSRC added a mind-boggling 640% just because the people behind the company said that they can transform the world as we know it. And that might be a bit of a problem because if the latest 10-Q is anything to go by, making any sort of impact on the way we live is going to be a tall order for BSRC. The figures at the end of March looked like this:

• cash: $173 thousand
• current assets: $239 thousand
• current liabilities: $3.6 million
• NO revenue since inception
• quarterly operating expenses: $155 thousand

Coming up with a ground-breaking alternative to a proven technology with less than $200 thousand in the bank and a working capital deficit of $3.4 million won’t be easy. That’s not the only problem.

Before plunging into the battery industry, BSRC were saying that they can develop innovative products that were supposed to reduce the cost of electricity produced by photovoltaic solar panels. Lots of promises were made over the years, but they have obviously come to nothing.

Even if you reckon that they’re going to do it this time, you mustn’t forget one important thing – while you may be prepared to pay $0.50 per share for BSRC‘s stock, other people could be getting it for a lot less than that. As we mentioned in some of our previous articles, the company’s books are riddled with convertible notes which (in some cases) can be turned into stock at a 50% discount.

The ticker was diluted by about 46% between May 2014 and May 2015 and a vast portion of the newly issued shares saw the light of day at prices that are way below the open market value. In April, for example, BSRC satisfied some debt with the issuance of about 2.8 million shares at just over $0.03 apiece. At the same time, people like you were paying between $0.06 and $0.12 per share. That doesn’t seem too fair from a shareholder point of view and it would be downright terrible if the discounted shares somehow find their way to the open market.