On4 Communications Inc (OTCMKTS:ONCI) Closes Flat
tags: ONCI
On Tuesday the infamous pumper the Wolf of Penny Stocks sent out emails announcing On4 Communications Inc (OTCMKTS:ONCI) as its new pick. The artificial hype generated by the promoter was massive with investors shifting the unprecedented for the past two years number of 263 million ONCI shares in a single session. Unfortunately for those who believed the words of the pumper the intense trading didn’t translate into a positive move up the chart. On the contrary, ONCI got devastated closing the session with a loss of 50% at $0.0013. Despite the disastrous outcome the Wolf of Penny Stocks still bagged a disclosed compensation of $43 thousand.
Yesterday the traded volume was significantly lower but the amount of shares that changed hands still doubled the monthly average reaching 78.9 million. The performance of the stock was rather volatile but in the end it closed flat at $0.0013. With the pump now over can ONCI hope to recover its losses?
Well, according to the latest corporate update ONCI will attempt to become “a disruptor in the dental and elderly care industry”. The goal is to transport equipment inside the elderly care facilities in order for the patients to receive dental care without taking the risk of going outside. No matter how exciting or noble a company’s business plan may sound the reality is that without funds very little can be achieved. And ONCI‘s financial state is nothing short of abysmal.
According to the latest financial report the company finished the quarter ended April 30, 2016, with:
• $7,500 cash and total assets!!!
• $2.6 million total current liabilities
• ZERO revenues
• $87 thousand net loss
While the fact that during the nine months ended April 30, 2016, no new shares were actually issued is truly admirable investors should keep in mind during the quarter ended July 31, 2015, as a conversion of notes ONCI had to issue over 169 million shares, which if nearly half of the 366 million shares that were outstanding at the end of April. ONCI plans to reduce its 5 BILLION authorized shares to $3.75 billion, as stated in the June 23 PR, but that still leaves plenty of room for more conversions to take place. The company had $304 thousand in convertible notes payable at the end of the period covered by the report.
The red flags surrounding ONCI are both numerous and extremely serious. Any trades involving the stock must be preceded by thorough due diligence and careful planning.
