Petrotech Oil & Gas, Inc. (OTCMKTS:PTOG) Jumps Right Back Up
We have been following the stock of Petrotech Oil & Gas (OTCMKTS:PTOG) for quite a while and with a good reason – the company has been the target of paid pumpers for the last 10 months. In that time we have received close to 180 different email alerts that were trying to push the stock up by creating artificial hype. Instead of flying higher than ever PTOG crumbled under the increased pressure and found itself dropping to just $0.0063 per share.
More than likely the stock was going to find leaving the double zeroes quite difficult but then the management team of the company decided to use the rampant optimism towards the marijuana industry and announced the creation of a new subsidiary Legalizedpot.us (LP.US Management Group Inc). On the very same day the stock exploded and increased its value by 234% closing the session at $0.023. The buying frenzy displayed by traders was so strong that they were able to shift the absolute record for the company number of 167 million shares.
The problem is that investors’ enthusiasm seems to dissipate quite quickly in the absence of news about the marijuana subsidiary resulting in rather consistent negative trends following each surge. Yesterday followed the pattern – another PR issued in the morning, another day of substantial gains. PTOG added 34% and returned to $0.044.
The pumpers did their part and throughout the day six email alerts were sent. The involved newsletters were primarily affiliates of Market 365 – QualityOTC, OTCEquity, Penny Stock Chief and VIP Penny Stocks. The biggest compensation disclosed by them was $15 000 for a one week promotion.
Sadly, the ongoing pump is just one of the numerous red flags around the company. On January 30, 2013 it did a massive 1-for-2233 reverse split but nine months later the outstanding shares had reached close to 80 million. At the start of this month that number had doubled to 160 million outstanding shares. With a lot more convertible notes the dilution seems unlikely to stop especially when the notes offer their holders a 50% discount from the market price.
Despite the recent barrage of optimistic PRs (15 for the past two months) PTOG‘s most recent reported financials painted a rather grim picture. At the end of September 2013 they had:
• $36 cash
• $9 thousand total current assets
• total current liabilities: $1.5 million total current liabilities
• revenues: $5 thousand revenues
• net loss: $667 thousand net loss
The report was filed on December 15 and since then there have been no news about new finance sources. The annual report for 2013 should be filed by the end of the month so when that happens we will see how PTOG have been able to fund its recent activities.
The marijuana craze may seem tempting enough but investing solely on hype should be avoided. Do you own due diligence about each and every company that decides to suddenly join the marijuana industry and take into account all the possible risks before committing to any trades.
The stock of Terra Tech Corp. (OTCMKTS:TRTC) has been on an absolute tear for the past five sessions resulting in one impressive climb. Last Thursday they opened at $0.5 while after yesterday’s trading the stock found itself at exactly $1.40. At such high price levels the ticker showed some signs of weakness indicating that investors might start cashing in their holdings. On the other hand the stock of Creative Edge Nutrition, Inc. (OTCMKTS:FITX) has been having difficulties keeping its gains and yesterday it dropped by another 4.8% to $0.08 per share.
