Electronic Cigarettes Intl Group LTD (OTCMKTS:ECIG) Explodes On Heavy Volume
Electronic Cigarettes Intl Group LTD (OTCMKTS:ECIG) had registered massive jumps in five consecutive sessions, before exploding into action and up the charts once more yesterday, on a heavy dollar volume.
This turn of events is a bit confusing – why was interest in the company suddenly re-kindled? How did the ticker manage to retain its momentum, in spite of the drastic change in investor activity? Why are investors once more enthusiastic about ECIG, in spite of the fact that it hasn’t really done anything to remedy its biggest and most obvious shortcomings?
Unfortunately, there is no easy answer to any of those questions. What there is, is a certainty that the company’s financial situation is still horrendous:
- Cash – $1 million
- Current Assets – $12.7 million
- Current Liabilities – $183 million
- Revenues – $11.1 million
- Net Loss – $67.5 million
True, the funding injection of $41 million that was to be used to clear some of its toxic debt was to leave ECIG in a better position, but there is no real way to tell if said non-dilutive funding has actually done the company’s share structure any good.
And the last glance we were allowed of it didn’t paint a pretty picture. Suffice it to say that between March 24, 2015, when ECIG performed a 15-for-1 reverse split, and May 15, which is the last time it announced its outstanding share count, ECIG‘s shares outstanding had grown from about 20 million to more than 70 million.
Investors should really take this information into account when making up their minds about ECIG stock. Failing to evaluate it correctly may well result in horrendous errors in judgment and the losses that always accompany such mistake can be staggering.
