Blue Earth Inc (OTCMKTS:BBLU) – Onwards and Upwards

We go through quite a lot of penny stock companies every day and one of the biggest threats to such ventures is usually the paid promotions. More often than not, when someone pays a particular newsletter some money for an awareness campaign, it could last for a couple of days, weeks and, in some cases, months. The pumped ticker could gain quite a lot of ground while the hype is still on but as soon as it’s over, things usually end up pretty badly for the regular investors. Is that the case with Blue Earth Inc (OTCMKTS:BBLU)?

The first email that we received about them by SmallCap Stock Plays is dated June 26, 2012. Back then they disclosed a compensation of $80 thousand in the form of 80 thousand shares of common stock. Now nearly a year later, BBLU‘s value is $3.74 which means that the promotion seems to be working.

It hasn’t been all plain sailing, though. Back in February and March, there was quite a steep decline in the price and within a matter of two months, the ticker slashed nearly a fifth of its value. What happened after that, however, is nothing short of amazing. BBLU started a long-lasting ascend on March 26 and since then, they have gained nearly 300%. Yesterday, they closed the session a further 15% above Tuesday’s value which means that their market cap currently stands at over $86 million. When you open BBLU‘s latest financial statement, you will see that this is a rather steep price for a company that has:

• cash: $458 thousand
• current assets: $6.6 million
• current liabilities: $8 million
• quarterly revenue: $2.8 million
• quarterly net loss: $1.8 million

While it is indeed a bit of a stretch, BBLU‘s market value is nowhere near as preposterous as the ones that we’ve seen from other small cap ventures. In addition to this they did issue some optimistic news in the recent weeks, like the one for the expansion of the school project in Hawaii. According to the press release, the contract was amended which means that the park will produce not three, but four megawatts of power.

This, along with some other forward-looking announcement has kept investors excited and because of all the optimism, BBLU managed to achieve something that even the bigger companies struggle with – a whole week without even one trading session ending in the red.

Remarkable performance for a penny stock, indeed, but it is still a penny stock and it could take traders by surprise at any time. Just like Sitoa Global Inc (OTCMKTS:STOA) and Continental Prison (OTCMKTS:CPSZ) shocked everyone yesterday losing 42% and 61% respectively.

As of right now, of course, there is nothing to suggest that such a thing is about to happen to BBLU, as well but there is that possibility, especially considering the fact that some insiders received quite a lot of cheap shares recently as an award for their work. Having in mind the ticker’s movement towards the big boys’ territory, some of the larger shareholders might be tempted to sell their stock which will inevitably depress the price. This means that while BBLU might seem like an attractive investment alternative, there are still some risks and it’s up to you to consider them carefully before making any decisions that might prove costly in the long run.