Is Jammin Java Corp (OTCMKTS:JAMN) About To Disappoint Investors Once Again?

Jammin Java Corp (OTCMKTS:JAMN)’s ascend started around the beginning of the month and after a solid performance during the first two weeks, the price had already gone from $0.33 all the way up to $0.53. Then the 10-Q for the period that ended on April 30 came out and it fueled a further rush in the green direction when, on June 17, JAMN managed to register nearly 20% gains in a single session on an impressive trading volume.

Unfortunately, despite the press release from June 19 where JAMN announced that their Marley Coffee is hitting the shelves of yet more national retail stores, things soon started to look a bit more dismal culminating in yesterday’s session when the losses amounted to 16% with a total of 1.8 million shares changing hands. Is that really a surprise, though?

Well, we’ve never failed to mention that JAMN seems to be a solid company with a real product that, if marketed properly, could get a lot of people excited. And from a traders’ point of view, they also deserve congratulations for the fact that they have managed to stay away from stock promotions for quite a while now. That said, some people still remember what happened when JAMN got the pumping treatment back in April and May 2011 and that still seems to make them somewhat nervous about a potential investment.

That was a long time ago, however, and things have really moved on since then. Not least because JAMN are registering revenues now and the excitement caused by the latest report is understandable since, as we mentioned in previous articles, we are witnessing growth. The primary issues right now are the losses which seem to be constant and the performance of the stock.

In an interview from last week, JAMN‘s CEO mentioned that shareholders shouldn’t be expecting to see the net loss simply disappear from the next quarterly report. He said that an aggressive marketing campaign is about to start and that it might prove expensive. He does believe, however, that the long-term brand awareness should outweigh all the expenses and if that really happens, we should see even more substantial growth over the next few years.

If you take a look at it from a more short-term perspective, however, you will see that the behavior of the ticker, when the PR activity is intensified is somewhat disturbing. We observed it back in January and February when a lot of forward-looking announcements pushed the price from around $0.11 per share all the way up to $0.40 but as soon as the press releases thinned out, the ticker started a descend and within a few weeks, it was standing at around $0.22. That’s hardly the performance traders want to see and while we can’t be certain that history is about to repeat itself once again, red sessions like the one from yesterday are raising eyebrows among shareholders who have already been there.

Similar spikes followed by sharp drops will certainly make potential investors more anxious about JAMN and that will in turn have an effect on the company credibility. Recently Petrosonic Energy Inc (OTCMKTS:PSON) showed us how devastating the effects of a crushed reputation could be. Let’s hope this never happens to JAMN.