Life Clips Inc.(OTCBB:LCLP) Gets Pulled Down Once More
Life Clips Inc.(OTCBB:LCLP) had another turbulent session yesterday, losing 13.49% of its market value on an increased dollar volume – and is it any wonder that it did?
Looking at the LCLP‘s OTC Markets profile reveals a glaring inconsistency. We’re talking about a company that, even after yesterday’s crash, has a market cap of $29 MILLION, in spite of not having major commercial achievements to date.
Yes, it is true, a lot of media attention has been thrown its way, and a couple of paid pumps a while back managed to spread awareness about it – but the fact remains that LCLP is not a commercially successful entity. A quick browse through its latest financial report ascertains that without a shred of doubt:
- Cash – $18 thousand
- Total other current assets – $48 thousand
- Total Current Liabilities – $65 thousand
- Revenues for the nine months ended March 2016 – $0.5 thousand
- Net cash used in operating activities for the nine months ended March 2016 – $420 thousand
Suffice it to say that those mediocre-looking financials don’t match the company’s bravado, or its market cap – wherein lies a serious pitfall for investors. There’s no way that this state of developments could go on uncorrected.
This is especially true since the company has millions of dollars worth of convertible debt that can be turned into shares of LCLP common stock under various provisions, some of which are so toxic it’s simply atrocious – “The conversion price is the amount equal to 50% of the lowest intraday trading price during the 20-day period prior the conversion date. The number of shares into which the debt under each note is convertible is determined by dividing the amount of the debt being converted by the purchase price.”
Could yesterday’s crash be the result of LCLP‘s past stock shenanigans coming back to haunt investor value? Only time can tell, but in the mean time, investors considering LCLP would do well to be on their toes.
