Energy Holdings International Inc (OTCMKTS:EGYH) Surges as Investors Wait for News
Energy Holdings International Inc (OTCMKTS:EGYH) has been performing rather well recently. It first woke up last month when a few days of increased activity brought it from deep in the sub-penny territory all the way up to $0.018. It then fluctuated a bit which is probably understandable considering the historic lack of liquidity, but over the last few sessions, it has really been flying high.
On Friday, the ticker managed to reach a close of $0.02 for the first time in over four months. EGYH slowed down a bit during yesterday’s session and it only added 2.5% to its value, but the volumes are still strong which goes to show that people are definitely interested.
They are waiting for some news. They are absolutely convinced that the company will come up with a press release soon. Why? Because some people around the message boards are telling them that this is exactly what’s going to happen.
It’s all rumors at the moment. Nobody from the management team has officially said anything about an upcoming update, but that won’t stop EGYH‘s shareholders from speculating on the content of the future PR. Some are even willing to calculate a potential share price based on that speculation.
One thing is for sure: EGYH definitely needs a positive press release. In fact, it needs the sort of announcement that will finally turn the company into a viable investment option because at the moment, it simply isn’t.
The latest 10-Q, for example, covers the first three months of the year and it looks like this:
- cash: $162
- current assets: $41,237
- current liabilities: $2,306,199
- NO revenue
- quarterly net loss: $977,140
We reckon that the financials speak pretty well for themselves, and in light of them, the paychecks that the management team receive are rather interesting. According to the latest 10-K, John Adair, the company CEO and Jalal Alghani, the CFO, pocket a compensation of $20 thousand per month. All this despite their less than spotless track record.
Some time ago, Mr. Adair and Mr. Alghani were at the helm of Adair International Oil and Gas Inc – another oil and gas company that was traded on the OTC Markets. Nothing came out of it and after a name change and another failed business plan, the stock was finally revoked in 2013.
As always, we’ll leave it up to you to decide what to make of all this. While you’re contemplating the risks, we’ll touch upon another thing that you should probably bear in mind. During the nine months ended March 31, the company issued 5,126,437 shares as a conversion of debt at an average rate of $0.0096 per share. During the same period EGYH also picked up $167,500 worth of debt. $84,000 of it is convertible at a 42% discount to the market price while the rest can be turned into stock at half of what you’re paying for it.
By the looks of things, some of the note holders are already taking advantage of the conversion terms. Last week, an entity called Vis Vires Group Inc filed a Schedule 13 form which informed us that the O/S count now sits at more than 57 million (compared to a little over 45 million back in May). Make sure you keep this in mind while you’re waiting for the much talked about press release.
