MassRoots Inc (OTCMKTS:MSRT) Falls Below $1 Per Share
Back in early September the stock of MassRoots Inc (OTCMKTS:MSRT) was trading above 2 dollar per share. Well, the hype around the stock quickly disappeared and since then the company has been forming one depressing chart. Not only that but the downtrend seems to be getting even stronger and after wiping another 9% of its value during yesterday’s trading the stock is now sitting at $0.9098. As a whole MSRT is down by more than 54% from the September highs. Is there a chance for a recovery though?
Two days ago the company announced that it has formed audit, nomination and compensation committees, which is an important step towards MSRT‘s goal of moving up to the NASDAQ national exchange. The reaction from the market however was far from enthusiastic and on that day the stock slid down by close to 5%.
MSRT has been talking about their potential uplisting for quite a while but we will leave up to you to decide how likely that is when at the end of the third quarter of the year the company had:
• $345 thousand cash
• $951 thousand total current assets
• $1.46 million total current liabilities
• $61 thousand revenue
• $2.1 million net loss
Even if you take into account the fact that MSRT began generating revenues in mid-August the reported amount still remains rather underwhelming. Especially when you compare it to the massive net loss for the quarter. MSRT expect to significantly ramp up their operations during the fourth quarter but it will be quite some time before the financial report for the period gets filed.
At least at the start of November the company managed to boost its balance sheet by raising a little over a million through the sale of shares and warrants. The proceeds will not keep them going for long though and MSRT will once more be forced to look for outside sources of funds in the first quarter of 2016.
Investors should also keep in mind that there are millions of warrants that could be exercised at prices far lower than even yesterday’s close. At the end of September MSRT had 3.9 million warrants exercisable at just $0.001 and around 3.6 million warrants exercisable at $0.40. Although the company will receive some funds from the exercise of these warrants if such underpriced shares get unleashed on the open market it could devastate the share price.
With the stock having depreciated so much a bounce could form at some point. Nevertheless, MSRT simply demands the use of caution. Do thorough due diligence and adjust your trades accordingly.
