Max Sound Corp. (OTC:MAXD) Regains Visibility
A variable and risky stock, Max Sound Corp. (OTC:MAXD) is logging healthy volumes two days in a row, adding more than 35% at the end of last week to $0.365. This is a ticker we have not seen in a long while, and the most probable reason for Friday’s spike may be valley buying, as often before MAXD has fallen to lows attractive enough for investors to pick it up again. 
The stock has been up and down in the past three years, with deep valleys and significant spikes in the boundaries of a few weeks. Here is a snapshot of the company’s underlying business as seen in its financial results: 
- $114,480 cash
- $196,380 total current assets
- $1.6 million total current liabilities
- $3,000 quarterly revenue
- $642,106 net loss, $15.8 million accumulated loss since inception
MAXD seems to have a modern and viable business model, providing HD audio to the media industry, yet this business has been saddled by debt, and while good in principle, may be suffering in the execution. In a media-rich environment, MAXD should also have been reaming in higher revenues than the token $3,000 it has to show, and which shrank again to zero in the quarter ended September 2012.
With this in mind, looking at the MAXD graph again shows a stock that falls on heavy selling, setting a danger for deep loss within a day or over several days. Keeping in mind that a company capped at $95 million is unable to ensure stable revenues and get out of debt, it is best to estimate your own risk level before taking up this ticker.
A much-touted proprietary technology is the bait of choice for many small cap companies, which entice investors with technological promise, but lack a real product and a functioning distribution network, thus leaving the company with nothing to offer but hot air and future promises. A similar pattern may be seen in the graph of Harmonic Energy, Inc. (OTC:ASUV), a tire recycler with a good general concept but still weak execution, and production still quarters or years ahead.
