Medient Studios Inc (OTCMKTS:MDNT) Wants to Bounce

Medient Studios Inc (OTCMKTS:MDNT) is certainly not for the faint of heart. Back in July 2013, the stock hit its 52-week high of $2.33 per share. On Thursday, less than eleven months later, it registered a 52-week low of just $0.002 per share.

Plenty of people around the message boards reckon that the ticker is now ready to get back to its former glory and, judging by the increasing volumes, investors seem to believe them. Before we see if MDNT is indeed about to embark on another run, however, let’s take a look at what caused the destruction of 99.8% of the value.

The paid pumpers certainly played their role. As you can see from our database, since April 2013, we have received around seventy emails from a range of promotional outfits. It’s clear that the ticker is not too keen on performing under the pressure and at this point, we should probably mention the fact that it’s currently the target of yet another campaign. Only two newsletters seem to be taking part – Wall Street Buzz (who received $11 thousand) and Information Solutions Group (who pocketed $10 thousand).

Although the pump isn’t particularly active and although the budget isn’t colossal, MDNT is not immune to severe drops which is probably something you should bear in mind while considering the risks of a potential investment.

The promotions aren’t the only problem. We’ve covered MDNT a fair few times over the last year or so and we can safely say that their balance sheet has never really been spotless. The same goes for the latest 10-Q. Here’s what the company had on March 31:

• cash: $68 thousand
• current assets: $6.8 million
• current liabilities: $11.2 million
• quarterly revenues: $29 thousand
• quarterly net loss: $1.3 million

The figures look bad enough on their own, but when you compare them to the ones registered at the end of Q1 of 2013, you’ll see that things are even worse. The revenues have pretty much disappeared while a $560 thousand net income has been turned into a huge loss.

At the same time, the dilution is quite severe. The report tells us that during the first quarter, MDNT issued a total of 218 million shares which, as the company CEO is keen on pointing out, brought the O/S count on March 31 to around 327 million. Take a look at the second page of the 10-Q, however, and you’ll see that on May 16, the number of issued and outstanding shares stood at 661 million. The report gives us no information on who and why got the newly issued stock, but we do know that MDNT recently increased the authorized capital to 5 billion shares and we won’t be too surprised if the printing press gets fired up again.

Having said all that, we should note that there is some good news as well. MDNT recently announced the start of the construction process on their massive Studioplex project. Apparently, a fresh water well is being drilled at the moment and work on the road infrastructure should also begin soon.

As we’ve mentioned numerous times in the past, if MDNT succeed in completing the state-of-the-art Studioplex, they might be in for a brighter future. Until then, the paid promotions, the inconsistent stream of revenues, and the horrific dilution are things you should definitely consider before putting your money on the line.

MDNT wasn’t the only OTC stock to register some significant dollar volume on Friday. Vape Holdings Inc (OTCMKTS:VAPE) logged a trade value of around $925 thousand and gained 1.6%. At $830 thousand, UMinning Resources In (OTCMKTS:UMNG)’s dollar volume was not quite as impressive, but its price movement was. UMNG jumped up by 58% and finished the day just short of the $0.003 mark.