Cannabis Science Inc (OTCMKTS:CBIS) Continues To Lose Positions
Yesterday the stock of Cannabis Science Inc (OTCMKTS:CBIS) fell below 3 cents per share after it finished the session at $0.029 for a loss of 8%. The ticker has been forming a rather depressing downtrend registering 8 red sessions out of the last 11. Is there a chance for the stock to reverse its direction?
Back in mid-April CBIS announced that they are going to distribute the dividend that they promised more than 4 years ago. The company also stated that it will try to distribute a dividend to its more recent shareholders. The eligible investors will receive shares from the new Class A common stock of the company. Understandably the news did cause a lot of commotion but maybe an increase of 118% in just a single day was a bit of an over-reaction having in mind the multitude of red flags surrounding the company.
Let’s start with the truly atrocious financial state – CBIS finished the entire 2014 with total revenues of $1031 and a net loss of $16.8 million while at the end of March they had:
• $37,524 cash
• $186 thousand total current assets
• $3.8 million total liabilities
• ZERO revenues
• $4.2 million net loss
If you are wondering why exactly are we still using numbers that are nearly six months old, well, that’s because the quarterly report for the period ended June 30 is nowhere to be found. The quarterly was supposed to be completed by August 15 but instead, on August 17, CBIS submitted a notification of late filing which gave them a 5-day extension. More than a month after the end of the extended deadline there is still no sign of the report. At the moment the company’s OTCMarkets profile page carries the OTC Pink Limited Information warning sign.
Apart from a more up-to-date state of the balance sheet the missing report was supposed to also show how many outstanding shares did CBIS have. We have been warning you about the continued dilution as a result of the millions upon millions of shares that are regularly issued to the officers and directors of the company through Stock Compensation plans. As of July 27 1.28 billion shares were outstanding. Although we don’t know the current outstanding amount the fact that CBIS decided to double their authorized shares – from 1.5 billion to 3 BILLION shares, should definitely raise some alarms.
In its recent PRs CBIS has been talking about a potential $15 – 25 million financing as well as a proposed NASDAQ uplisting. Even if the company receives the maximum amount of the funds we will leave it up to you to decide how likely it is for them to move to a national exchange. If you are determined to trade the stock be sure to do extensive due diligence before putting any money on the line.
