Premier Biomedical Inc (OTCMKTS:BIEI) Explodes On New PR

After crashing for four consecutive sessions  and dropping from $0.024 to a low of $0.0114 Premier Biomedical Inc (OTCMKTS:BIEI) managed to not only stop its slide but to more than recover its losses. Opening yesterday’s trading at $0.0112 the stock was able to climb up to a close at $0.0326 for a staggering gain of more than 185%. What caused investors to once again rush towards BIEI though?

Well, a couple of hours into the session BIEI published a new PR. In it the company announced that one of the lead outside scientists working with them has been invited to present his findings at the San Antonia Breast Cancer Symposium on December 9. In its previous PRs BIEI did state that it plans to present its “stunning results” to the American Association for Cancer Research in December. Is yesterday’s PR substantial enough to justify BIEI‘s stock nearly doubling its price?

Especially when you consider that there are several extremely serious red flags hanging around the company. A little over two months ago, at the end of September, BIEI were in a dire financial state with:

• $73 thousand cash
• $87 thousand total current assets
• $516 thousand total liabilities
• ZERO revenues
• $189 thousand net loss

Out of the reported liabilities over $133 thousand were outstanding convertible notes and the resulting dilution has been devastating. In just a month and a half approximately $95 thousand of the notes were converted into 39.5 million shares at an average share price of just $0.0024. The outstanding shares of the company ballooned from 26 million at the end of September to more than 60 million as of November 20.

BIEI may be able to keep the hype going if they keep posting positive PRs but the fact remains that they will need to find new sources of funds and this could mean the issuance of more convertible notes. Investors shouldn’t forget that the company is still facing years of clinical trials and that it will require significant capital.

Basing your trades solely on hype is never a wise decision. No matter how optimistic you are about the potential of a certain pennystock company it is paramount to do sufficient research before putting any money on the line.