COREwafer Industries, Inc. (OTCMKTS:WAFR) Returns To Double-Zero Land
COREwafer Industries, Inc. (OTCMKTS:WAFR)’s stock has been having a hard time in the OTC markets since forever. It’s general direction after the beginning of 2012 has been downward and WAFR entered triple-zero land in the end of last month.
We regularly see press releases from the company, but they rarely make an impact on the ticker’s price and volume. Again, on March 25, WAFR announced that The Big Biz ShowTM is conducting interviews with the company’s CEO and CFO. The effect on the stock from this announcement was as expected – none.
Yesterday, however, WAFR made a review of their venture for 2013, which finally sparked some interest in investors, despite its controversial contents. What was most bothering was the confession of a whopping $3.4 million in debt owed by its subsidiary CORE WAFER SYSTEMS, INC that they previously didn’t know about.
Still, the company stock went up 62% and closed at $0.0013 on the highest volume in 3 years of trading. We saw a massive 450 million shares change their owners, which generated a healthy $514 thousand trade value, but how is WAFT doing financial-wise.
Here are some numbers from their 9 month financial report, covering the period ended September 30, 2013 that was filed under the alternative reporting standard with the OTC markets.
- cash: $730!
- current assets: $1.8 million
- current liabilities: $4.3 million
- total liabilities: $8.3 million
- revenues: $619 thousand
- net loss: $484 thousand
On the bright side of things, the revenues have almost doubled, compared to 2012, while the net loss was lowered by more than 50%, which is a good sign if you don’t look at the cash on hand WAFR has got. On the other hand, the total liabilities have gone up a mind-numbing 376% in less than a year.
Still, there is one big, red flag that remains. The company mentioned in their press release that they have increased the authorized share count of the preferred and common stock to 775 million shares with the intent to eliminate a portion of their debt. This means that we will surely see some dilution when WAFR starts issuing shares to cover their deficit and we might see some serious corrections.
This is a really good reason for you to do your due diligence and weigh out the risks if you have any thoughts of betting on this stock.
