Coda Octopus Group, Inc. (OTCMKTS:CDOC) Crashes On High Volume
The general direction of Coda Octopus Group, Inc. (OTCMKTS:CDOC)’s stock has been upward for quite a while, but considering their operations, the attention that it is getting from investors is rather low.
The stock started climbing faster recently, as there is much more feedback about the company development since the beginning of this year. Yesterday, however, we saw a serious correction, which was quite the mistery.
For no apparent reason the company stock started sliding down violently in the afternoon and we saw some big volume, most probably generated by people who got cold feet and decided to get out with smaller losses.
Selling lower and lower in price, CDOC closed the session with a big 41.94% loss at $0.18 on more than 3 times its average volume. In the end, the count of the shares that had switched hands during the day came at 1.39 million, which had generated $313 thousand in dollar volume.
It is interesting that CDOC isn’t getting much attention considering their financials. The latest annual report, covering the yearly period ended October 31, 2013, filed under the alternative reporting standard in the OTC markets contained the following numbers.
- cash: $8.2 million
- current assets: $14.9 million
- total assets: $20.1 million
- current liabilities: $3.3 million
- total liabilities: $19.2 million
- revenues: $22.3 million
- net income: $5.3 million
And yet, despite the fact that the company is profitable and in a rather good financial state, CDOC‘s stock is misteriously dropping. There is talk going on in the message boards about a lawsuit from people who participated in the institutional private placement with which CDOC raised $15 million in 2007.
They seem to want 97 million shares, because they are not happy with the restructuring that CDOC made in 2011 with the approval of 85% of unit holders. The deal is that the institutions that filed the lawsuit last week are accounting for 14.6% ($1.745 million) of the private placement and they need a minimum of 15% are against the restructuring.
This, however, happened last week, so why is CDOC crashing violently now? It seems that the company stock is becoming quite unpredictable, despite the rather stable operations and balance sheet.
All in all, CDOC is a decent stock, in a good financial state, that may be a bit undervalued. That, of couse, doesn’t mean that you should skip on doing your due diligence and weighing out the risks, before making a decision to invest in them.
RightSmile, Inc. (OTCMKTS:RIGH) lost quite a lot of their value yesterday as well, dropping a hefty 40% down after the massive gains from Tuesday. Kleangas Energy Technologies, Inc. (OTCMKTS:KGET) on the other hand, climbed an impressive 72%.
