Nutech Energy Resources Inc (OTCMKTS:NERG) Remains A Volatile Choice
After surging up the chart by more than 60% and closing at $0.0138 on Tuesday the stock of Nutech Energy Resources Inc (OTCMKTS:NERG) failed to sustain the positive momentum and yesterday it fell straight back down. At the very start of the session the ticker did move to an intraday high of $0.0161 but by the time of the closing bell it had slid down to $0.0124 for a loss of over 10%. What will happen during today’s trading though?
Well, on Tuesday NERG issued a PR stating that today they are going to release information on a major acquisition. And, indeed, at the start of today’s trading they announced the acquisition of pipeline assets of over 400 miles.
Since the start of November NERG have been quite active and so far they have announced plans to acquire thousands of wells from which the company plans to start producing natural gas using its patented technology that is capable of reducing overhead costs from conventional methods of natural gas production by as much as 80%. Originally NERG‘s technology was stated to reduce overheads by 60% but in the more recent PRs that number was bumped up to the aforementioned 80%.
NERG also plans to leave the OTC market behind and move up to the NASDAQ national exchange. In today’s PR this goal was reiterated with the company stating that it is very confident that by the end of spring, 2016, it will be able to meet all of the required milestones for the uplisting. How realistic is this however when in their most recent financial report NERG reported the following numbers:
• ZERO assets !!!
• $4,916,766 current liabilities
• ZERO revenues
• $347,306 twelve-month net loss
Admittedly the report is for the quarter ended August 31 and the company could have improved its financial state since then. The problem is that the risks around NERG run far deeper.
We have been warning you that according to the report the company had over $765 thousand in debt that is convertible into shares at a 50% discount. In addition as a satisfaction of previously issued convertible debt NERG have agreed to issue 245 million shares priced at $0.006 each.
While in the quarterly report the authorized shares of the company were still listed as being 250 million investors should keep in mind that in January NERG amended its Articles of Incorporation and increased its A/S to 35 billion, or maybe 65 billion as stated in this filing.
The volatility of the ticker should not be underestimated. The PRs published by the company may keep investors excited but the numerous red flags are serious enough to depress the share price back down. Do extensive research before putting any money on the line.
It seems that today’s announcement left investors quite a bit disappointed and in the early minutes of the session NERG crashed hard currently trading over 25% in the red at $0.00950.
