Hemp Inc. (OTCMKTS:HEMP) Slowly Declines
As one of the very first marijuana pennystocks Hemp Inc. (OTCMKTS:HEMP) may be able to remain among the most heavily traded companies but the performance of their stock is far from positive. After yesterday’s 7% drop and the close at $0.077 HEMP wiped all of its gains made at the start of February when the hype around the company was at its highest. Since then enthusiasm has been slowly dying out and the positive sessions have been few and far between.
For now the frequent PR messages from the company have been preventing a sharper downwards trend but, although slowly, the stock has lost close to 75% compared to its recent high of 30 cents. HEMP tried to lure investors in by announcing rather substantial increases to its revenue for 2013 but the annual report filed on April 15 revealed little improvement in their balance sheet:
- $2200 cash
- $33 thousand total current assets
- $18 thousand total current liabilities
- $2.3 million revenues for 2013
- $1.2 million net loss for 2013
The report also revealed that the outstanding shares had reached 1.8 billion out of the 3 billion authorized, or for the last quarter of 2013 around 200 million shares saw the light of day. Most of them were issued through the conversion of more preferred K shares owned by the CEO of the company.
Back in 2012 in order to satisfy its obligations towards Mr. Perlowin HEMP gave him 193 million preferred K shares that after some steady conversion were dropped down to 124 million. Now though Mr. Perlowin has even more shares than ever after he received another 85 million preferred K again for satisfaction of debt so investors should expect the dilution to continue.
On April 14 HEMP said that the expected revenues for just the first quarter of 22014 were around $5.4 million, or nearly double the amount for the whole of 2013. The dramatic increase should have come from the numerous consulting deals signed in the past months with various pennystocks.
Even that impressive number failed to change the negative sentiment among investors and rightfully so – many of the companies that hired HEMP for consulting services are riddled with red flags. Not to mention that revenues alone are far from enough in order to gauge the real state of the company. Another marijuana pennystock – SK3 Group, Inc. (OTCMKTS:SKTO) has been writing millions of revenues in its reports, more than 50 million for 2013, thanks to their management services but they have been unable to collect even a small part of them. 