Kenergy Scientific, Inc. (OTCMKTS:KNSC) Climbs Another 150% on Robust Volumes
Kenergy Scientific, Inc. (OTCMKTS:KNSC) discovered the sure-fire recipe to lift its slim volumes and stock price- and the trick worked immediately. KNSC is now one of the newest and hottest marijuana stocks, and its low price allowed for amazing growth in those giddy initial days. On Monday, the ticker shot up by 150% to $0.0015, on dollar volumes a bit above $2 million. Amazingly, the news helped to move 1.5 billion shares on both Friday and Monday, livening up the company’s hefty share structure. And despite the early price drop on Monday, the ticker ended up with a strong gain, suggesting a deceptive intra-day volatility. 
With such a trigger, KNSC may be in for more active days- and as a consequence, to expose more investors to the inherent risks of an exuberant gainer that is still selling at a faction of a penny. Like many other OTC pot stocks, KNSC so far has only words and promises to offer when it comes to legal marijuana plans. Its link to the sector is to offer media and advertising services, through a China-based office.
Like many other sub-penny selections, KNSC carries a lot of baggage in its balance sheet, despite the extraordinary gains in the last quarter:
- cash: $120
- current assets: $75 thousand
- current liabilities: $3.7 million
- quarterly revenues: $202 thousand
- net income: $14 thousand
Despite the “limited information” label on the OTC profile page, KNSC in fact filed reports with the SEC, showing a record of past activity. But the net gain is an extraordinary item, and there is no evidence that KNSC will be able to take a piece of the advertising revenues from a still very young marijuana sector.
In effect, KNSC is a PR firm, with a strong bent toward social networking and other online forms of marketing. This is achieved through the Sparx Business Media, Inc. company, a subsidiary which is the prime mover behind the pink sheet ticker.
A similar idea helped bring out Resource Ventures, Inc. (OTCMKTS:REVI) from the double-zero range, and to a relatively stable perch at $0.03. REVI promises to print a magazine on hemp paper, to popularize trends and topics in the legal cannabis sector. For this, REVI partnered with Hemp, Inc. (OTCMKTS:HEMP), one of the earliest birds in the pot stock market. Riding the reputation of a well-established and well-traded ticker was a really useful vehicle for the depressed stock price of REVI.
Despite the 1.5 billion shares moved in a day, keep in mind that the whole free float of KNSC is more than three billion shares, and moving those amounts may slow down as the initial enthusiasm wears off. Avoid over-investing in a ticker that has arrived out of nowhere, to avoid getting caught in a stagnant period, or in a deep correction after the fast initial gains.
