Growlife, Inc. (OTCBB:PHOT) Fails to Breach Ten Cents, Slips
On Friday Growlife, Inc. (OTCBB:PHOT) closed the session over 8% down. Volume remained relatively strong with a little over 17 million shares changing hands. The pullback was more or less predictable, considering the movement of the price over the last few months.
The ticker had run all the way up from a humble $0.03 per share in early August to an intra-day high of $0.095 last Thursday. The chart makes it immediately obvious that every time the stock managed a decent run up, that was followed by a cooldown period. Luckily for PHOT longs, each following run up managed to balance it out a little higher and the price finally managed to clamber near 10 cents per share.
Friday’s slip may be the next pause the ticker needs to get its bearings before moving on, as it has gained nearly 30% over its last run. The company was lifted by a series of positive press releases over October and had a strong month. On the bright side of things, quarterly revenues are growing at a steady pace and are approaching $1 million per quarter, but this still doesn’t manage to offset the company’s growing expenses and the latest quarterly shows net loss of over $1.5 million.
The company has convertible debt that should not be overlooked and is issuing new shares at a pace some may not find to their liking. January through June 2013 PHOT issued 173 million common shares to clear convertible notes, with the shares valued at $1.32 million, which would mean under a cent per share.
The overall picture is also marred by a ‘research report’ which PHOT informed the public about in a PR announcement. The report in question sets a $0.23 price target for the ticker, which would be great, if the report itself wasn’t paid for by the company itself. The fine-print disclaimer states that the researchers received $2,500 in cash and 3 million PHOT shares for compiling the so-called report which is rather like a paid advertisement, considering the compensation listed and the multiple ‘conflict of interest’ parts in the disclaimer.
Whether PHOT will correct further or stabilize after Friday’s slip remains to be seen.
