mCig Inc. (OTCBB:MCIG) Back With A Bang
mCig Inc. (OTCBB:MCIG) jumped 17.91% yesterday, pushed up by the hype generated by the new CNN marijuana documentary.
The lack of news and significant developments had certainly pulled MCIG down for a few sessions – with nothing to keep the hype going, share prices had fallen as low as $0.603. Fortunately for the whole marijuana sector, the new documentary on marijuana, by D-r. Sanjay Gupta, hit the wire yesterday and got things moving again.
The CNN special was faithful to the style of the previous one, and painted an intriguing picture for its viewers. It certainly provided interesting information on medical marijuana and its potential, showing footage of people with various ailments and how the “wondrous plant” has helped change their lives for the better.
Obviously, marijuana stock traders saw this as their cue to start investing. MCIG stock seemed to be gathering momentum steadily, as investors became more and more eager, and reached a high of $0.711 before the session’s closing bell. But do traders really have cause for such enthusiasm?
The documentary was informative, if somewhat vague, and although it was heavily biased and focused entirely on the potential benefits of medical marijuana, it did make some valid points. It may yet turn out that medical marijuana is the answer for many health conditions in modern society. There is certainly opportunity for profit in the developing marijuana market. However, all these arguments don’t change the fact that some of the publicly traded companies dealing with medical marijuana are risky investments at best.
Due diligence is always advisory when committing to any trade. And, in the case of MCIG, any research will yield multiple red flags. The foremost and most indicative of these being the company’s latest financial report. It covered the period ended Oct. 31, 2013, and was unconvincing to say the least:
- cash – $13 thousand
- total liabilities – $81thousand
- revenues – $13 thousand
- net loss – $19 thousand
MCIG‘s expected to file another 10-Q soon, and if this report turns out to be as unimpressive, the ticker might be in for a rough time.
Another company that skyrocketed on the news of the latest marijuana development is Terra Tech Corp. (OTCMKTS:TRTC), whose market value increased by 18.64% yesterday.
