Makism 3D (OTCBB:MDDD) Gets a Pump

If you take a quick look through Makism 3D (OTCBB:MDDD)’s historical data, you’ll see that the stock isn’t really prone to making huge jumps up and down the chart. Most of the sessions in its short trading history ended with very little in terms of price movement but, surprisingly for such a young ticker, it has managed to attract quite a lot of volume. At first glance, the interest was easily explainable with the fact that the 3D printing industry is extremely popular among OTC investors at the moment. Unfortunately, when we dug a bit further, we saw that there are other, more sinister things lurking in the shadows.

If you have a look through our articles from a couple of weeks ago, you’ll see that the recent developments around MDDD resemble a typical paid pump set up. The name was recently changed, a new management team was put in place, a stock split was effectuated, and there were promises of a really exciting product. On paper, this seems like a normal restructuring and nothing more than regular corporate optimism. In Pennyland, however, this often means that a promotion is in the making.

Sure enough, the emails started flying around on Saturday. The Paragon Report and the other newsletters controlled by Providence Media Strategies LLC are the main promoters and according to the fine print under their emails, they have already pocketed $50 thousand for their efforts and expect to receive $100 thousand more for a three-month advertising campaign.

If you have gone through MDDD‘s SEC filings, you know that the stock doesn’t really need a pump campaign. At Friday’s close of $1.07, the market cap stands at more than $63 million. That’s a lot for a company that has around $15 thousand in total assets and no revenue since inception. We’ve already talked about the recent private placement, the discounted stock and the potential implications associated with it.

All in all, there are plenty of things that could hamper MDDD‘s progress in the long run. What’s more, Umicron Ltd, the company’s operating subsidiary was incorporated less than a year ago and we’re not sure if such a limited time frame is going to be enough to make any sort of impact.

Still, the involvement of a promoter as prominent as The Paragon Report should give the price a boost, at least in the short term which means that riding the hype might not be such a bad decision, right?

Not necessarily. The Paragon Report might be a rather prominent player in the world of penny stock promotions, but that doesn’t mean that their track record is spotless. In fact, their previous pick was Arch Therapeutics Inc (OTCBB:ARTH). The same people that are now touting MDDD jumped on board when ARTH‘s pump was just heating up. Their emails started hitting investors’ inboxes on July 10 and on the very next day, the ticker registered its 52-week high of $1.36. Unfortunately, just minutes after it did, it started sliding heavily down and just a week later, it was sitting at $0.45. The chart on the right should give you a broader perspective of how it all ended.

The Paragon Report’s horrific promotional history certainly warrants some extra caution, but there are other things that might turn MDDD into a complete disaster. If you’ve been following the penny stock world in the past few weeks, you’ll know that the SEC seems to be paying a lot more attention now than it did before. The regulatory organ put an abrupt end to three large-scale promotions in a matter of just two weeks. Sovereign Lithium Inc (OTCMKTS:SLCO) received their trading suspension on November 15, a week later Life Stem Genetics Inc (OTCBB:LIFS) got halted, and Nevada Gold Corp (OTCBB:NVGC) were also axed on November 26.

The promotional budget for MDDD is not quite as big as the ones for SLCO, LIFS and NVGC, but Andrew Ceresney of the SEC’s enforcement division said in an interview for The Washington Post that the Commission has hired full-time employees to monitor the small cap sector which means that halts for the less expensive pumps might start coming in the near future. That’s why, carefully thinking through every single move before making any decisions is absolutely crucial.