Hop-on, Inc. (OTCMKTS:HPNN) Drops Back To Triple Zero Levels
For the past two years the stock of Hop-on, Inc. (OTCMKTS:HPNN) was completely forgotten by the market. As a result it lay dormant at the absolute bottom of $0.0001 per share and shifted some shares only sporadically. This month though things finally started to pick up speed culminating in the February 20’s monstrous session.
On that day HPNN simply exploded. Investors went into a buying frenzy and more than 3.4 billion shares changed their owners resulting in a dollar value of nearly $5 million. The stock surged by exactly 400% closing at $0.0015 while also posting its new 52-week high of $0.0028.
We have seen quite a few similar chart patterns displayed by companies announcing that they will be joining the overly hyped marijuana industry. The reason for HPNN‘s spike was different though. The company revealed that they have signed a worldwide patent licensing agreement with none other than Microsoft Corp. (NASDAQ:MSFT) under their Android licensing program.
There weren’t many concrete details about the deal and the positive effect of the news proved to be short-lived indeed. On the very next day HPNN slid down by 7% to close Friday’s session at $0.0014. Over the weekend the negative momentum among traders only picked up strength and yesterday HPNN crashed hard wiping 42% of its value and returning to $0.0008 per share.
So why even a deal with Microsoft proved unable to lift the company’s share price for more than a day? Well, HPNN may describe themselves as an “an international leader in the development and manufacture” of electronics, software and telecommunications but their reported financials show a different picture. They finished 2013 with the following results:
So why even a deal with Microsoft proved unable to lift the company’s share price for more than a day? Well, HPNN may describe themselves as an “an international leader in the development and manufacture” of electronics, software and telecommunications but their reported financials show a different picture. They finished 2013 with the following results:
- $352 cash
- $41 thousand total current assets
- $1.3 million total current liabilities
- $792 thousand revenues
- $135 thousand net loss
Admittedly HPNN are able to generate revenues but they are clearly not enough to cover the expenses of the company. With almost non-existent cash reserves and a negative working capital of $1.25 million they are in a desperate need of fresh funds. And here lies the next major problem – HPNN have exhausted almost all of their authorized shares. As of December 31 7.44 billion out of the 7.48 billion authorized shares were issued. The preferred convertible shares have also reached their limit of 20 million authorized shares leaving the company with very limited options.
In an attempt to to keep at least some of its gains in share price HPNN published on their official website another PR article. This time the management team decided to take advantage of the marijuana optimism among traders and announced that their subsidiary Re-Medical, Inc. will be selling cannabis transdermal patches. The launch of the products should take place in a month in Colorado.
We will see if the news will have any effect on the share price during today’s trading. Still many of the new comers to the marijuana industry have presented investors will opportunities for quick gains so be sure to do your own due diligence and plan accordingly. Two of the current pennystocks leading the marijuana sector – Growlife, Inc (OTCBB:PHOT) and Medical Marijuana Inc (OTCMKTS:MJNA) have also fallen on hard times. PHOT continued to correct for four consecutive sessions after it lost another 6% yesterday closing at $0.34 per share. On the other hand MJNA managed to avoid closing in the red but the gain of less than 1% shows that the stock is still hesitant.
