Life Stem Genetics Inc (OTCBB:LIFS) – Just Another Expensive Pump
“Is Life Stem Genetics Inc (OTCBB:LIFS) being promoted?” is probably the question on the minds of traders that, for one reason or another, don’t have the time to do some proper due diligence. Seeing that more and more attention is being drawn towards the ticker, we decided to find out.
We must say that from the very start, LIFS looks like the perfect pump candidate. The name and business were changed back in September when the company ditched their plan of selling Serbian delicacies through a fast food chain and decided to acquire Life Stem Genetics – a development stage healthcare company dealing in the stem cell sector. Predictably, some stock saw the light of day, a split was effectuated, and the number of authorized shares was increased.
If you’ve been following stock promotions for a while, you know that most of the pumps follow one and the same pattern – the one outlined above. Sure enough, an email about LIFS hit our inbox on October 29. It was sent by Contrarian Press (CP), it discloses no compensation, but it does quote the ticker as a “high-value-potential stock” and it urges us to go and check out their special report.
In case you’re wondering, CP were saying much the same things about Coyote Resources Inc (OTCMKTS:COYR) back in April and they were completely and utterly wrong, but still, we decided to check out what they had to say about LIFS and if you do the same thing, you will see that it looks like the classic pump report – full of colorful pictures and promises of a bright future. Two things stand out though.
The first one is the “infinite” long term price target which we find rather amusing, and the second one is the disclaimer. Apparently, LIFS themselves paid $300 thousand for the colorful report and we’ll leave it up to you to decide whether that’s a good decision or not, considering the development status of the company.
The paid promotion is a big enough red flag on its own for most people, but it would appear that someone has decided that the report simply isn’t enough. That’s why a landing page was set up which contains a word-for-word copy of CP’s promises as well as a disclaimer that’s even more interesting. The website has been established by an entity called Eclipse Media Group (although the domain registration was apparently done by CP themselves), the paying party is not mentioned, and the budget amounts to no less than $1,789,000. This puts LIFS‘ pump up there with the most expensive campaigns currently running in Pennyland and it also presents an even bigger red flag.
It wouldn’t have been so bad if the company actually had something to show us but when you dig into the details, you’ll see that things are quite sketchy.
The pumpers say that Life Stem, which was privately held before the merger, “has already applied over 5,000 ASC (Adult Stem Cell) treatments“. Apparently, however, they did the work for free. LIFS filed the pro-forma financial statement in an 8-K form on October 8 and according to it, the company had the following fundamentals as of June 30:
- total assets: $192 in cash
- total liabilities: $139 thousand
- no revenue since inception
- yearly net loss: $150 thousand
Even though they recently announced the closing of a $500 thousand private placement, it’s still far from enough to justify the market cap which, at yesterday’s close of $1.25 per share, stands at around $55 million. This, in turn, leads us to believe that a painful drop is all but inevitable. How painful exactly? We reckon that Pan Global Corp (OTCMKTS:PGLO)’s chart can give you the answer.
