Harmonic Energy, Inc. (PINK:ASUV) Caught in a Maelstrom

After very nearly doubling on Tuesday, yesterday Harmonic Energy, Inc. (PINK:ASUV) sank and lost a third of its market cap. Over the last few sessions ASUV enjoyed a lot of heavy volume trading but it looks like nothing can stop the price on its way down.

Times are tough for ASUV shareholders, with their investment shrunk 90% in less than two months. In early February ASUV traded as high as $1.45, now the price has been squished to $0.068 as of the last close. It may turn out the company’s dream of a cleaner world and tons of recycled vehicle tires may turn out to be just that – a dream.

ASUV is very consistent in issuing press releases and maintaining a very optimistic tone in them. Sadly, most releases concern plans, ongoing talks and negotiations and not much in terms of operational results and accomplishments. The last financial report filed by the company is a 10-Q for the quarter ended January 2013 and it contains the following:

• $26 thousand in cash
• $262 thousand in current liabilities
• zero revenues for the last two years
• $51 thousand quarterly net loss
• $459 thousand accumulated deficit

In mid-March 2012 ASUV acquired rights to a recycling technology against the obligation to pay a total of $525 thousand, in three equal installments. Over the next 9 months, the company generated no revenues from the technology and still needs to pay $350 thousand to the owner of the technology, creating a lot of company debt and holding on to a dead asset that generated no cash. The company stated that it would need new equity financing amounting to about $50 million to proceed with planned operations. Anyone armed with a calculator can estimate how much such a potential development would dilute ASUV stock.

With nothing particularly attractive in their filings and a stock price that has gone down 96% down since early February, ASUV don’t exactly look primed for a bright future.