Global Earth Energy Inc (OTCMKTS:GLER) Slips, Time for Some PR Action
On Monday Global Earth Energy Inc (OTCMKTS:GLER) gained no less than 50% after just six and a half hours of trading but the peculiar thing is, there was no immediately apparent reason for the jump. A new promotional email from Penny Stock Pros had hit our inbox, but we somehow doubt that it alone was enough to get traders quite as excited.
Penny stocks, and especially, sub-penny tickers tend to move both up and down freely, but they rarely do it for no obvious reason. When an unexplained run like the one seen from GLER is made, the threat of a sudden and quite violent drop is very real indeed. Sure enough, Tuesday wasn’t quite as optimistic and the ticker slid by around 4%. This correction, however, is nothing compared to what happened yesterday. Six and a half hours of trading were enough for GLER to shift more than 95 million shares resulting in a dollar volume of around $320 thousand and 25% of the value gone. This really cements GLER‘s reputation as one of the more erratic stocks on the OTC Markets. So what about the future?
Well, it would appear that the management team weren’t particularly happy with the results from yesterday and probably that’s why they decided to issue a press release. And isn’t it exciting? Apparently, GLER‘s partner, Hawk Manufacturing, has closed a partnership agreement with Southstar Capital, an investment firm based in Mount Pleasant, South Carolina. The contract will allow Hawk to draw up to $2.5 million per month as part of a revolving line of credit for working capital purposes. Does this mean that GLER are finally onto something?
It should do. After all, working capital for Hawk means that acquisitions can be completed in a more timely manner. This, in turn, should lead to revenues and profitability for Hawk. GLER own a 20% stake in Hawk, so their sorry-looking statement should be improved somewhat as well. Are things so simple though?
As a matter of fact, yes, they are. If the subsidiary is making money, so should the bigger company. There is, of course, a twist in the case of GLER. And it’s one that we’ve been talking about for a while – the past failures.
As we mentioned in our previous articles, GLER‘s management team have perfected the art of announcing promising events (and then disappointing investors) to perfection. On Tuesday we gave you the example of a 2006 press release in which Sydney Harland, the company CEO, announced that GLER had taken the first steps to becoming a world leader in the distribution of Atmospheric Water Generators, but it’s clear that this plan never really worked.
Today, we’re going to give you a more recent example. This press release is dated June 16, 2011 and it says that GLER have acquired 25% ownership in a $92 million company called Global Earth Natural Resources, Inc. Once again, Mr. Harland was talking about things like “shareholder value” and “profitability” and his statements sound really rather amusing in light of the latest 10-Q.
Will Hawk Manufacturing and its countless acquisitions of successful ventures be any different? Only time will tell, but currently, there is little difference between the optimism found in the announcements from years gone by and the current hype. Make sure you tread extremely carefully when considering your options.
Other companies that drew in quite a lot of attention during yesterday’s session include American Community (OTCMKTS:ACYD) who seem to have ran too high for their own good and Pan Global Corp (OTCMKTS: PGLO) who registered a second red day bringing the losses up to a staggering 66%.
