Pulse Beverage Corp. (PINK:PLSB) Down in Double Digits

Yesterday Pulse Beverage Corp. (PINK:PLSB) slumped 11% to a close of $1.28 per share, shaving 16 cents off its share price. Volume was much heavier than that in recent sessions, at 257 thousand shares traded – still a fraction of what other OTC companies shift daily, due to the high pps by penny standards.

The last few sessions of PLSB were very level and calm, with undulations in both directions of under 2% and it seemed the stock had found a level to take a breather at before its next significant move. Traders are probably hoping yesterday was not the start of one such movement down.

The heavy volume and rapid price drop in the early session may indicate someone was trying to scramble out in a hurry. While the company seems to be working hard to expand its distribution network and put its long-awaited Pulse flagship drink on a shelf near you, it keeps postponing the deadlines it sets for itself.

In November PLSB said in a letter to shareholders it will be “ready and able” to launch the Pulse drink into its distribution network as early as December. A new letter to shareholders from the end of March now states that the company has “just begun” introducing Pulse to its distributors. The same March letter states that PLSB expects to reach its one million cases sold threshold by June this year. Strangely, the November letter to shareholders stated that the company expected to reach the 1 million case mark by March, not June. How long PLSB can keep pushing those expected dates back is an unknown but some investors may have had about enough of it.

PLSB ended 2012 sitting on the following financials:

• $744 in cash
• $347 thousand in current liabilities
• $2.2 million in yearly revenue
• $3.5 million in yearly net loss

Stock based compensation is still one of the significant factors that lead to recording losses. 2012, referred to by the company as their ‘first full year of operations’, was not exactly a shining success. The company claims that it’s still actively developing its distributor network and investing a lot in that but their largest expenses remain salaries and stock based compensations.

Priced above a dollar, any OTC stock has a lot to lose. PLSB has proven resilient and managed to hold out for some time. It remains to be seen if it can sustain and prolong its excursion on this side of the charts.