Clean Coal Technologies Inc (OTCMKTS:CCTC) Crashes
On Monday the stock of Clean Coal Technologies Inc (OTCMKTS:CCTC) broke through the $1 mark for the first time since early-2014. Such prices proved to be too much for the company to support though and yesterday it suffered a heavy blow. The ticker opened at $1.09, which turned out to be its highest point of the day because it immediately began sliding downwards. By the end of the session CCTC had wiped 23% of their value closing at $0.80 per share.
This means that at the moment the market cap of the company stands at $32.6 million. Is this valuation more in line with CCTC‘s fundamentals? Unfortunately, nobody knows. The company hasn’t filed a single financial report for 2015 which led to OTCMarkets branding the profile page of the company with the Pink Limited Information warning sign. The last filed report came on December 24, 2014, and covered the quarter ended September 30, 2014. According to it back them CCTC were in a horrible financial state:
• $1,237 cash and total current assets!
• $4,352,182 current liabilities
• ZERO revenues
• $1,011,605 net loss
A considerable amount of the reported liabilities consisted of convertible debt, a portion of which could be turned into shares at discounts ranging from 25% to 42%. CCTC has stated that since then all of the convertible debt has been either retired or restructured. Keep in mind however that earlier this year the company did increase its authorized shares – from 45 million to 150 million.
Even the company’s recent financing deals could potentially cause some concerns. According to the terms disclosed in the 8-K forms under certain conditions the three $500 thousand promissory notes could become convertible into units consisting of 1 common share and 1 warrant for the purchase of 1 share at $0.10.
Yesterday CCTC announced that they will be hosting a corporate business update conference call and webcast on October 13. The company should provide investors with more details about its test plant in Oklahoma and its pans to commercialize the Pristine-M technology in the next two months. If this will be enough to keep the stock from crashing even further down in the coming days remains to be seen.
CCTC has some serious red flags that should not be underestimated. Do your own due diligence and set appropriate time horizons for your trades.
