CashMoneyPlay Starts Pump of Great China Mania Holdings, Inc. (OTC:GMEC)
The promoters at CashMoneyPlay have officially announced that they are discontinuing their efforts with their previous pick and will now be pumping a certain Great China Mania Holdings, Inc. (OTC:GMEC). The emails were put in circulation yesterday and the stock is already starting to move and generate volume.
GMEC is a China-based company that the pumpers call an ‘e-commerce’ business. GMEC is a low-interest stock, with relatively low trading volumes before the pump. Operating out of China, the company will certainly raise some eyebrows with the more cautious traders. This will in turn lead to people opening their financial reports, that reveal the following:
- cash down from $305 thousand to $231 thousand
- Q3 revenue of $1 million
- Q3 net loss of $305 thousand
What this basically means is that while the company is trying, it keeps logging net loss and chewing through whatever revenue it generates – not exactly the formula for a successful business. With shrinking cash, it may turn out that it’s only a matter of time before GMEC finds itself back against the wall and starts issuing convertibles or seeking equity financing.
In addition to this, the company’s latest 10-Q lists related party transactions for a lease. That is to say, GMEC paid $73 thousand in 2012 and another $182 thousand in 2011 to a certain entity named China Culture Limited (CCL). CCL happens to be a wholly owned subsidiary of one of GMEC‘s directors. If the company’s management think it’s okay to pay directors with shareholder money, investors may not be too keen on that idea.
GMEC was also the target of paid promotions in the past. In mid-October promoter Damn Good Penny Picks touted GMEC after nabbing $30 thousand in compensation. Immediately following the promotion the stock crashed about 50%. The current pump run by CashMoneyPlay also inspires little confidence, considering the track record of the promoter, which includes fiascoes like Ludwig Enterprises (PINK:LUDG).
While the pump is not yet in full swing and the stock hasn’t cropped up among the top traded penny stocks yet, this may well happen as more people buy in on the pump hype. Traders are advised to be extra careful with this one, as with all other promoted stocks for that matter. The pump may run for some time but it may crash the day after tomorrow just as well. Stay safe and do your own due diligence.
