Medient Studios, Inc. (OTCMKTS:MDNT) Continues Its Roller Coaster Ride
So far the stock of Medient Studios, Inc. (OTCMKTS:MDNT) is having an extremely turbulent week. On Monday it surged upwards by more than 54% and returned to $0.0034 per share but on the very next day it crashed hard wiping 35% of its value. Yesterday the stock once again tried to recover by reclaiming 13% and closing at $0.0025. Despite the positive session MDNT is still hovering dangerously close to its 52-week low of $0.002 posted on May 22.
If you take a look at the chart you will see that for the past two months MDNT has been going nowhere but down. Even after the recent gain the stock is still down by 92% compared to its price of 3 cents per share from the start of April. A year ago the company was sitting above 2 dollars per share. So what has caused such a massive drop?
The answer is quite simple actually – dilution. MDNT‘s shareholders have been suffering through immense levels of dilution of the common stock. At the end of September, 2013 the number of outstanding shares was 38 million but just three months later it had reached 327 million, an increase of nearly 1000%. Unfortunately it gets even worse – on May 16 that amount had nearly doubled and was now sitting at 661 million shares. As of yesterday traders who have contacted the transfer agent of the company claim that the outstanding shares are more than 1.6 billion. MDNT currently have 5 billion authorized shares so the dilution might not be stopping any time soon.
The worsening financial state of the company doesn’t help either. According to the financial report covering the first quarter of the year the company has:
• cash: $68 thousand
• current assets: $6.8 million
• current liabilities: $11.2 million
• quarterly revenues: $29 thousand (down from $1.9 million for Q1 in 2013)
• quarterly net loss: $1.3 million (down from $560 thousand net profit for Q1,2013)
• current assets: $6.8 million
• current liabilities: $11.2 million
• quarterly revenues: $29 thousand (down from $1.9 million for Q1 in 2013)
• quarterly net loss: $1.3 million (down from $560 thousand net profit for Q1,2013)
For now investors are hoping that the launch of the movie “Yellow” scheduled for August 29 will manage to at least somewhat alleviate the depressing situation of the company. Initially the movie will be available in New York, San Francisco, Los Angeles, Seattle and Chicago followed by a possible nationwide expansion.
Another positive development is the fact that the construction of MDNT‘s massive Studioplex in Effingham County, Georgia is finally underway. On March 20 the company hired Shore Development and Construction, LLC to carry out the project that has an approximate cost of $700 million. According to the contract everything should be completed in 2018.
Mr. Manu Kumaran, the CEO and CFO of the company, has stated on numerous occasions that MDNT is a long-term investment but in a recent tweet he also said that he has no experience in the stock market. Ultimately, it is up to you to 
decide if MDNT‘s potential outweighs all the risks around the stock. Just be sure to do your own due diligence before committing to anything.
decide if MDNT‘s potential outweighs all the risks around the stock. Just be sure to do your own due diligence before committing to anything. Yesterday the stock of Growblox Sciences Inc. (OTCMKTS:GBLX) suffered a severe crash wiping 20% of its value and dropping down to $2.12 per share. The pumped stock of Green and Hill Industries, Inc. (OTCMKTS:GHIL) on the other hand continued to climb up the chart closing the session 26% in the green at $1.42.
