JunkieDog.com Inc (OTCMKTS:JKDG) Boards the Pot Bandwagon and Slips
What do marijuana and designer shoes have in common? Nothing? Well, that won’t stop JunkieDog.com Inc (OTCMKTS:JKDG) from selling both pot growing equipment and women’s footwear.
JKDG actually started off with the idea of offering insurance services. That didn’t work and after a change in control and a 1 for 1,000 forward split, it became a shoes retailer. In a rather surprising move, however, the company announced two weeks ago that within the next few months it will start selling tents, bulbs, and other products that will help you grow cannabis in the comfort of your home.
As you might imagine, the press release was garnished with a few words about the cannabis industry and about how rapidly it’s growing. Despite this, investors don’t appear to be impressed. On the day of the announcement, JKDG did perk up and it broke above the $0.12 per share mark. The volumes, however, remained almost non-existent and it soon started sliding down. Yesterday, we did see some more interest from investors, but instead of pushing the stock in the right direction, they dragged it 13% down to a close of $0.095 per share. So, what went wrong?
Well, the pumpers are at least partly to blame. The stock has been subjected to quite a lot of promotional activity over the last month or so. A grand total of $86 thousand has been spent on the pump since the beginning of April and the latest batch of emails arrived before yesterday’s opening bell courtesy of The Next Big Trade (who received $25 thousand), All Star Stock Picks (who pocketed $10 thousand), Hidden Gem Stocks (who were compensated $20 thousand), and Value Penny Stocks (who banked $6 thousand). The chart clearly shows that the hype spread through the emails is not doing JKDG any favors.
Still, although the stock performance wouldn’t suggest it, we mustn’t forget that the company does have a few things going for it. Bear in mind that during the first full quarter of selling shoes online, JKDG managed to rack up revenues of about $336 thousand and it also came up with a net profit, albeit a tiny one. Some of you probably reckon that the pumpers can’t hang around forever and that with the bizarre, but potentially profitable mixture of pot growing equipment and designer shoes, JKDG will really be given the chance to shine.
Hopefully this will indeed turn out to be the case. Until then, however, you shouldn’t forget one very serious problem. As we mentioned a few weeks ago, JKDG‘s balance sheet is riddled with toxic debt that can be turned into stock at considerable discounts. As we also mentioned in our previous coverage, some note holders have already taken advantage of them and have turned $9 thousand worth of debt into 2 million shares. This brings the conversion price down to just $0.0045 per share and you should be able to calculate for yourself how humongous the profit opportunity for the note holders is at the moment.
