GelTech Solutions, Inc. (OTC:GLTC) Soars, Announces Insider Buying

GelTech Solutions, Inc. (OTC:GLTC) seems to be following a major trend among penny stocks, climbing out of a valley at the beginning of the new year. The company already trades around $1.58 and on Monday added 18% to its value. This ticker, a higher-value company, is not featured in our database of promotions, except for a brief intra-day mention back in 2011 which coincided with record prices and volumes. Since then, it is harder to say what caused GLTC to move up or slide.

The company, still listed as a developer, is producing fire-extinguishing water additives and specialized water-retention substances to prevent dust rising. This has led to the following financial results:

• $280,549 cash

• $1.15 million current assets

• $2.3 million total current liabilities

• $37,453 revenues for the quarter ended December 2012

• $1.4 million net loss

While GLTC seems to be making money with its specialized products, it is still logging losses. While the company seems to be having some working capital deficit, for now it seems credible enough to support a longer-term climbing trend, especially if aided by another promotion. The ticker has been up to $3.75 and down to less than 50 cents in the past, with GLTC currently capped at more than 47 million dollars.

The past few days saw several small transactions of insider buying at $1.17, around 5,000 shares. The biggest insider holding is of 1.8 million shares acquired at 50 cents. There is no way to know if any of the holders plan to sell any time soon, but most of the purchases are at a serious discount to the current market price. Potential gains may be higher with a pump campaign, or a more active PR message campaign.

There is a further sale of 482,778 unregistered shares as of the end of February, for total proceeds of $280,000, citing exemptions that allow such a new issue. In the same filing, GLTC announced another sale of 1.4 million shares for $500,000. A further $1.4 million convertible note may mean extra share dilution and further insider holdings out of the 29 million shares outstanding.

A recent fast mover, First Liberty Power Corp. (PINK:FLPC) also shows a significant activity in insider buying, for below-market prices. For now the ticker is correcting, and we must wait and see if it could be taken upward again by promotions or press information. But in any case, it is best to estimate for yourself the best time horizon for the stocks you pick to avoid significant failure.