Sigma Labs Inc (OTCMKTS:SGLB) Hangs In There
NASA recently announced that they are thinking about sending a 3-D printer to the International Space Station and we’re pretty sure that most of Sigma Labs Inc (OTCMKTS:SGLB)’s shareholders were hoping that their company will be, in one way or another, involved in the whole operation. Unfortunately, as of right now, there are no indications that this will happen which is probably quite disappointing for some investors, but let’s not be too harsh.
SGLB is one of the more charismatic penny stocks out there. Their latest financial statement (while it’s by no means perfect) does look better than the ones displayed by many of their small cap counterparts, they have managed to stay away from paid promotions and they do have a terribly exciting business plan.
It’s not all wishful thinking, either. Back in May, General Electric Company (NYSE:GE)’s Aviation subsidiary announced that they have signed a Joint Technology Development Agreement with SGLB and there’s little doubt in anyone’s mind that, provided SGLB succeed in sticking to the terms of the deal, both the company and the share price will be positively affected. Few penny stocks can boast about such a thing.
That said, SGLB is still a penny stock which could serve as an explanation for the inconsistent chart movement from the last couple of months. Back in May, the ticker was fluctuating between $0.02 and $0.03. Then, in June, shortly after the deal with GE went public, investors started paying attention. The price received a massive boost from the increased interest and by mid-July, SGLB was already way above the $0.10 mark. What followed, however, could be classified as a crash. Within just two weeks, the value plummeted below the $0.04 per share mark. Since then, it has managed to regain its dignity and it’s now back hovering around $0.10. Even so, we still see some unpredictable runs in the right direction followed by painful drops, all that, accompanied by increased trading and dollar volumes.
Yesterday, the ticker managed to regain some of the ground it lost during Friday’s session finishing the day 9% in the green, but, having in mind the erratic performance from the last couple of weeks, predicting the future movement becomes nigh on impossible. All in all, just like virtually all the OTC tickers out there, SGLB remains as volatile as ever and keeping this in mind could save you quite a lot of sleepless nights in the future. Is there anything else to be worried about?
Unfortunately, there are a few other things you need to consider. Business descriptions all over the internet inform us that SGLB is a company involved in the booming 3-D printing industry. They do have some patents and GE contracted them because they hope that, with their help, the time for the manufacturing of certain elements can be reduced significantly.
The problem is, they’re not quite ready with the development stage (the revenues registered so far are coming from consulting services). According to the latest 10-Q, the technology should be commercially available during the fiscal 2014 which, truth be told, is not that far away. The thing that worries us more, however, is the fact that the management team wrote in the Q1 statement that they will be ready by the end of 2013.
SGLB have set themselves quite a task and, of course, set backs are not impossible. You should have in mind, however, that potential obstacles in the future, coupled with the stock’s volatility could wreak havoc with the chart movement. If the discounted shares sold during the July 2013 private placement hit the market, the results will probably be quite catastrophic as well.
In conclusion, we can definitely say that SGLB does show some signs of a long-term potential. Despite that, an investment still comes with its risks and ignoring them could lead to some substantial losses.
The people who jumped in on Nutranomics, Inc. f/k/a Buka Ventures Inc (OTCBB:NNRX) without considering the potential downsides, for example, took a massive blow yesterday and the same thing can also be said about the traders who locked their investments in North American Oil & Gas Corp (OTCBB:NAMG).
