Interactive Health Network (OTCMKTS:IGRW) Gets a Hype-Induced Volume Spike
Interactive Health Network (OTCMKTS:IGRW) issued a shareholder update on January 22 and informed us that things are looking good. Fred Schiemann, the company CEO, announced that the results for the quarter ended December 31, 2014 have exceeded expectations and said that he is looking forward to a successful 2015. Then, as they say, there was silence.
The company did file its report for the fourth calendar quarter of last year and the sales figures in it were in line with Mr. Schiemann’s expectations. In fact, between October and December, the company managed to register more revenues than during the year ended September 2014 which is definitely a good sign.
Sadly, b hasn’t published any other press releases ever since, and, as you probably know, investors aren’t too fond of OTC companies that don’t update their shareholders regularly. The volumes remained small and the ticker fell in triple zero land in late February. A month later, it bounced back up, but once again, IGRW was a long way away from being among the most heavily traded OTC tickers out there.
And once you take a look at the latest quarterly report, you’ll see why. Indeed, the revenues are decent, especially for a sub-penny stock, and when Mr. Schiemann said that they are growing, he wasn’t exaggerating. Sadly, the rest of the statement is not quite as impressive. Here’s a summary of all the figures:
- cash: $10 thousand
- current assets: $153 thousand
- current liabilities: $1.5 million
- quarterly revenues: $353 thousand
- quarterly net loss: $228 thousand
As you can see, IGRW is indeed one of the few revenue-generating pot stocks out there, but even so, the business is not exactly flourishing. There isn’t a whole lot of cash, the working capital deficit is quite substantial, and the company is still losing money.
In light of all this, some people might prefer to wait and see if IGRW has what it takes to turn things around and actually transform itself into one of the few success stories in the publicly-traded marijuana field. Others, however, don’t want to wait.
Message boards and social networks are buzzing with activity and there’s no shortage of people who abuse words like ‘massive‘ and ‘breakout.’ Stock Situation Room decided to take advantage of the hype and excitement and they sent out a free email yesterday which used pretty much the same words.
Unfortunately, ‘massive‘ and ‘breakout‘ don’t make for an accurate description of what happened to IGRW during Monday’s session. The ticker lost 9% and it finished the day at a little less than $0.0021 per share. It’s not doing much better in early trading today. About twenty-five minutes after the opening bell, it’s another 4% down.
Nevertheless, yesterday’s session also ended with more than $250 thousand in dollar volume which means that a lot of people put their money on the line in the hope of seeing some future growth. Of course, there’s nothing wrong with that, but if you are one of the investors who feel good about the upcoming months, you shouldn’t forget what happened the last time people got a bit overly optimistic. Back in May 2014, just a month after IGRW changed its name and entered the marijuana industry, Goldman Small Cap Research issued a paid research report on the stock and said that it could reach $0.16 per share. As you can see, a year later, this price target remains elusive.
