Imogo Mobile Technologies Corp (OTCMKTS:IMTC) Bounces as the Promotional Onslaught Continues
After surging up by as much as 413% in just six sessions, Imogo Mobile Technologies Corp (OTCMKTS:IMTC) dropped on Tuesday and wiped out around 38% of its market cap. This was hardly a surprise for the people who knew that the ticker is the target of a $3 million promotion. Those who didn’t, however, were wondering what was going on.
Fortunately for them, IMTC has managed to regains quite a lot of lost ground since the terrifying drop. On Wednesday, it managed to claw back 15% and yesterday it added another 7% finishing the day just shy of the $0.60 per share mark. Somewhat predictably, the run is now a bit more tentative but the volumes are still strong.
The problem is, the pumpers have not yet left IMTC alone. As we mentioned in our previous article, shortly after Tuesday’s drop, Stock Castle – one of the most infamous pumping outfits – started sending in their alerts. So far, we have received five emails from them and their affiliated newsletters, but, having in mind the $800 thousand compensation, we expect to see some more touting in the days (or maybe even weeks) to come.
In the interest of fairness, we should point out that this time, it’s not only the pumpers that are drawing investors’ attention towards IMTC. The company itself, willingly or not, jumped in to help. They issued a press release on February 5, just a few minutes before the closing bell and, a few hours later, published an almost identical copy for good measure.
It says that IMTC have signed a memorandum of understanding with an entity called Global Digital Systems (GDS) – a public company traded on the Cyprus Stock Exchange and owner of a website called SiteTalk.
SiteTalk, the press release says, is a social network that was launched in 2009 and has become extremely popular since then. Indeed, we read through some older announcements from GDS and, according to them, their platform is used by more than 15 million people. But where does IMTC come in?
Apparently, while it has been a huge success throughout the rest of the world, SiteTalk has failed to draw in attention from US users. If the shareholders give their approval and if the two companies actually reach a definitive agreement, IMTC will be responsible for marketing the social network in America. The press release says that they are going to use their clever mobile and HTML5 technology (which, by the way, is estimated to be worth $0 according to the company’s latest 10-Q).
The announcement of the memorandum of understanding certainly sounds optimistic and if IMTC actually manage to sign the agreement, they could see some revenues. The management team, however, set the deadline for the closing of the contract on May 2 which is nearly three months away. That is a lot of time in Pennyland. Especially having in mind the paid pump.
As we mentioned in Wednesday’s article, Stock Castle’s previous pick, Nevada Gold Corp (OTCMKTS:NVGC), got suspended by the SEC during the peak of the promotion. There are investors who fear that IMTC might be in for the same fate and we should note that it is certainly a possibility.
Of course, the SEC might also decide to let the pump continue but even if they do, the people who splashed out $3 million on the campaign will want a return on their investment. If they manage to get it, it will probably be at the expense of the regular investor. That’s why, treading extremely carefully and doing a lot of due diligence is absolutely essential.
