Primco Management Inc (OTCBB:PMCM) Trips and Falls
After months of sitting virtually idle, Primco Management Inc (OTCBB:PMCM) made a few announcements over the last couple of weeks and the new developments certainly had an effect on the stock. The culmination of all the excitement was witnessed on Wednesday when the ticker jumped up by no less than 142% and racked up a dollar volume of a whopping $4.6 million.
As we mentioned yesterday, the tremendous buying pressure was caused by PMCM‘s entrance into the medical marijuana industry and it helped the ticker emerge from the triple-zero levels for the first time in months. The excitement was huge and many investors around the message boards thought that the 142% in gains was just the beginning of a much more spectacular run.
Yesterday, however, PMCM slipped and fell hard. The ticker opened the day at $0.0017 and started sliding almost immediately. Six and a half hours later, it stopped at $0.0011 and registered a dollar volume of around $2.25 million.
The people who were talking about the spectacular run are now calling yesterday’s drop a “healthy consolidation” and we’ll leave it up to you to decide whether wiping our 35% of the market cap is in any way “healthy” or “consolidating“. In the meantime, we might as well see where the stock is heading next.
The management team keenly pointed out on Wednesday that the company has no plans of growing cannabis. They want to acquire land which they will later lease to licensed medical marijuana producers and retailers. Now, just two days after the announcement of the new business, they seem to be hard at work getting it on the road.
They woke up early today and issued a press release saying that they have entered a preliminary agreement for the launch of their first medical pot cultivation center. Once again, the PR article doesn’t give out too much in terms of details, but from what we can gather, the facility is located somewhere in California and as soon as PMCM acquire permits from the local municipality, they are going to lease it to licensed medical marijuana retailers.
As is often the case, the press release is garnished with numerous bright projections about the future of the company and the whole excitement could result in another push for the stock. That said, there’s been no shortage of promises of wealth and fortune in PMCM‘s past announcements, but unfortunately, they’ve yielded little results in terms of long-term performance.
Back in February 2013, for example, David Michery took the helm and promised to turn PMCM into a multi-million dollar NASDAQ-listed corporation. A year later, he has a company with less than $30 thousand in quarterly revenues, about $400 thousand in working capital deficit and more than $1.6 million in quarterly net loss.
Speaking of which, PMCM isn’t Mr. Michery’s first attempt to make an impact on the micro-cap world. He is also listed as the CEO of United Music & Media (OTCMKTS:UMMG) – a double zero OTC enterprise whose stock hasn’t seen active trading for years partly because of the dismal state of their financial results and partly because of the fact that they haven’t filed any reports since 2011.
Here’s one more thing you probably need to consider. As we mentioned yesterday, one of PMCM‘s biggest problems is the devastating dilution that the shareholders have gone through. More than 800 million shares saw the light of day in a matter of just six months and there are some things to suggest that more stock was issued after the filing of their latest report. According to the Q3 statement, the total number of issued and outstanding shares as of November 20 hovers just above the 1 billion mark. The daily volume on Tuesday amounted to more than 3 billion shares while yesterday, PMCM managed to shift nearly 1.7 billion. It’s not impossible for the number of shares changing hands in a day to exceed the total outstanding count, but it is extremely unlikely. We’re quite sure that the shareholders will be happy to take a peek at the company’s current share structure.
