Fortitude Group, Inc. (OTCMKTS:FRTD): A Highly Risky, New Marijuana Stock

Fortitude Group, Inc. (OTCMKTS:FRTD) put all its chips on the table at the end of last week, as it announced the news that many sub-penny stocks are eager to make: the company would be forging a link to the cannabis industry. FRTD thus managed to lift up activity to record levels, and grow by more than 111% to reach $0.0095, on buying volumes of $1.19 million.

FRTD is not in active promotion, but its latest PR from February 21st mentions that FRTD would be setting up a marijuana company, and partnering with other existing entities on the market to distribute its products, still unspecified. Otherwise, FRTD is the perfect company for such a deal, giving that it describes itself as a holding company seeking acquisitions and novel, potentially lucrative industries. For such an optimistic company, the lack of a website are a strange choice.

At the end of January, FRTD continued restyling itself by replacing old CEO Norm Birmingham with Thomas Parilla. This somehow clears the ticker from the fame of Mr. Birmingham, who has been quite busy with other pink sheet companies, lifting them up to unsustainable positions. So the moves of FRTD may be nothing more than another concerted effort at pushing share price upward, only with the addition of general exuberance on the OTC markets.

Besides the fact that FRTD is not posting audited financial results, this is its ninth identity already, and even for a pink sheet, the name changes reveal a worrying back story of past performances. On the OTC page, FRTD reveals a dismal situation: zero cash and revenues, zero assets for years on end, though it still carries $1.5 million current liabilities. None of those pieces of data justify the relatively low market cap of $5 million. FRTD also has about 606 million shares outstanding, with a further 980 million authorized.

But for now, the ticker is mostly inflated by sentiment, as there are enough investors’ opinions to cheer the short-term rise amid the warnings of doom and gloom. Still, when it comes to sub-penny selections, not all OTC companies are created equal, and FRTD is among the businesses with very poor quality, with too many pointers toward a scenario in which the company is merely a vehicle to increase stock price and benefit a short-term investing strategy.

Now, there are rumors that FRTD would be partnering with Triton Distribution Systems, Inc. (OTCMKTS:TTDZ), another recent mover that would have stayed in the triple-zero range without the mention of a foray into the cannabis business.

But if you like the low price range for marijuana stocks, Latteno Food Corp. (OTCMKTS:LATF) is promising a few more good days, as it heads toward posting detailed financial results. While LATF was traded low, it managed to make a slow, but steady trend and for now hangs on above the one-cent level.

In the case of FRTD though, there are too many red flags and investing is not advisable, unless you can afford to bet on the rise without suffering too much from the losses.