Fortitude Group, Inc. (OTCMKTS:FRTD) Recovers on Share Buyback News
At the end of last week the stock of Fortitude Group, Inc. (OTCMKTS:FRTD) showed that it was still capable of sudden surges up the chart after it jumped by more than 17% returning to $0.026 per share. The change in investors’ sentiment was caused by another PR article that proudly revealed that FRTD have purchased 8.5% of their public float, or 27.5 million shares through open market transactions. Apparently that was all traders wanted to hear and traded volume for the session reached 23 million shares, more than tripling the numbers from the previous day.
Now the company is trying to achieve a similar result and early in the morning announced that since their Stock Repurchase plan has been put into action 20% of the 894 million outstanding shares have been retired and returned to the treasury. Although these are undoubtedly positive news and are certainly a cause of optimism among FRTD‘s shareholders the company cannot rely solely on share reduction to keep their stock from crashing even further down. And providing encouraging financial results from their business might prove to be problematic.
On April 16 FRTD filed their annual report for 2013 and it actually contained worse numbers than the quarterly report for the period ending September 30, 2013 when the company had exactly 2002 in cash and current assets. Three months later, at the end of December, they had reduced them to:
- $1250 cash and total current assets
- $1.48 million total current liabilities
- ZERO revenues
- $376 thousand net loss
That is right, despite announcing quite a few acquisitions FRTD have still not been able to generate even a dime in revenues. Well, to be fair quite a few of them have not actually been completed despite FRTD issuing quite a few PRs talking profusely about them. For example back in July last year they entered into an agreement to acquire 15% of the private company PRIMARQ, Inc. This has not happened as of yet but FRTD have actually increased their supposed stake to 45%.
The annual report also revealed a little more about the mysterious “revolutionary” MariMist marijuana product which apparently should be ready for commercialization at the end of the year. At the same time in the entire annual report there is no mention of their prepaid cash card that, despite a rather troublesome launch, is also supposed to bring millions in revenues, at least in FRTD‘s own words.
The first order for the VaporVites vaporizers should be completed this week but we will have to wait for at least two more weeks until the next quarterly report to see if the deal will amount to anything. Until then investors should be extremely careful when trading the stock of the company initiating positions only after extensive due diligence. In early trading today they are going even higher up currently 13% in the green at $0.030. At the same time the stock of mCig, Inc. (OTCBB:MCIG), one of the more established pennystocks producing vaporizers, is having a disastrous start of the day plummeting by 7.5% and dropping to $0.53 per share.
