BioSolar Inc (OTCMKTS:BSRC) Wipes More of Its Gains
On June 16 BioSolar Inc (OTCMKTS:BSRC) announced that they are developing a new technology that will allow them to create a “super lithium-ion battery” that will double the range of a Tesla automobile, cost 4 times less, have a faster recharge rate and longer life. The PR quickly grabbed the attention of the market and in just three weeks the stock of the company climbed from $0.07 to a high of 54 cents per share.
Despite the impressive sounding press release in our articles we warned you be extremely careful when approaching the stock as it was approaching some truly unrealistic price ranges. It seems that we were right and for the last three sessions BSRC has been rapidly retracing its steps down the chart – on Tuesday the stock crashed by 22.4% while yesterday it wiped another 18% of its value closing the trading day at 31 cents per share. The losses have been severe but the ticker is still far away from its previous price ranges. Will BSRC manage to keep at least some of their gains?
The last financial report filed by the company covers the first quarter of the year and the numbers found inside fail to inspire much confidence:
• $173 thousand cash
• $239 thousand current assets
• $3.6 million current liabilities
• ZERO revenues since inception
• $155 thousand operating expenses
Out of the reported liabilities at the end of the period $730 thousand consisted of convertible promissory notes some of which can be turned into common shares at a massive discount to the market price of the stock. In April 2.8 million shares were issued at $0.06 each, 182 thousand shares were priced at $0.033 while 413 thousand shares had an even lower conversion price – just $0.013 per share. At first glance the issued amounts don’t seem that alarming but keep in mind that BSRC had less than 15 million outstanding shares as of May 6.
Investors may have also been left a bit disappointed by the latest PR published by the company. In it BSRC announced that their research agreement with the University of California, Santa Barbara, has been funded for another 12 months. Without a specified launch date this could mean that the development of the “super battery” may take quite a lot of time.
If the hype continues to subside the stock might find it extremely hard to support its current share price and even more severe corrections could follow. Trades involving not just BSRC‘s stock but any of the various pennystocks out there should always be preceded by careful planning and doing you own due diligence.
