Primco Management, Inc. (OTCBB:PMCM) Plummets Once More
The stock of Primco Management, Inc. (OTCBB:PMCM) followed the pattern it set last week almost exactly. Back then PMCM surged upwards by the massive 142% just to wipe more than third of its value on very next day.
This Tuesday they shot upwards culminating in a gain of 155% just to wipe close to 35% during yesterday’s trading after closing at $0.003. Despite the severe corrections PMCM is keeping most of its gains and is sitting 500% higher than its share price from two weeks ago.
Such explosive runs have become quite common these days and are caused by a company revealing its plans to join the emerging legal marijuana industry. PMCM are certainly not an exception.
The official PR for the switch in business goals came on February 12. In it the management of the company explained its intentions to acquire properties, which it will subsequently lease to licensed medical marijuana retailers and manufacturers. It is important to note that PMCM will not be taking part in the cultivation or the sale of the plant.
On the day of the announcement traders managed to shift the record number of 3 billion shares which we found quite puzzling. PMCM‘s OTCMarkets profile lists the number of outstanding shares at a little more than 1 billion. Although it is not entirely impossible the likelihood that the whole amount of outstanding shares was moved three times over is extremely slim. Now thanks to the Form 14c that was filed two days ago we know what is going on.
Apparently since November 18 the company has been quite busy issuing new shares and in just three months have put in circulation another 3.8 billion shares. This brings the currently outstanding number to 4.8 billion out of the 5 billion authorized. That is why they are increasing the authorized to the mind-boggling 25 billion.
If the possibility of even further dilution isn’t scary enough for you then take a look at the company’s financial results for the quarter ending September 30:
- $115 thousand cash
- $3.1 million current assets
- $3.5 million current liabilities
- $29 thousand revenues
- $1.6 million net loss
The impressive assets consist mainly of the musical rights held by PMCM which were acquired through short-term convertible debt. In turn these rights generated less than $30 thousand in revenues.
It is still quite early to say how viable their marijuana business is going to be but at least they can rely on a equity purchase agreement with Southridge Partners II, LP for the total of $10 million worth of shares. Thanks to the recent increase in their share price PMCM will have to issue quite a lot less shares than their initial projections.
With the massive boost in interest towards the company and the volatile performance of the stock traders certainly have opportunities for some quick gains. In order to avoid any unnecessary losses though it is always for the best to do your own due diligence before attempting any trades.
Yesterday the majority of marijuana pennystocks also slid down to a close in the red. Another recent entry into the industry – Cyber Kiosk Solutions, Inc. (OTCMKTS:CYBK) lost 15% of its value and dropped to $0.28 per share. HEMP, INC. (OTCMKTS:HEMP) is continuing to fall shedding another 8.3% and closing at $0.149.
