Signal Bay, Inc (OTCMKTS:SGBY) Has Some Teething Problems
Many years ago, the public company that we now know as Signal Bay, Inc (OTCMKTS:SGBY) was called Quantech Electronics Corp and it was traded under the QTCE symbol. Apparently, QTCE‘s management team had the tendency to issue a few press releases every now and then, but unfortunately, nothing came out of the bombastic forward-looking statements. Predictably, there was no shortage of angry investors.
Now, the company has a new business plan, a new management team, and a new ticker symbol. Press releases, however, are still present. On Friday, SGBY said that they will acquire a majority interest in a medical marijuana research and testing facility before the end of the month. Investors jumped in and traded nearly $190 thousand worth of shares during one of the first truly active sessions for the stock in its new incarnation. But will they be left disappointed again?
That is for time to tell. Investors placing their Buy orders should know, however, that SGBY is in the pumpers’ sights. Epic Stock Picks received $23 thousand and they’ve been pumping the ticker since the beginning of Friday’s session.
People contemplating a potential investment should also bear in mind that, at least for the time being, SGBY isn’t proving itself as the best performing stock out there. Despite the pump and the optimistic press release, it fell down by almost 34% on Friday and it closed the week with a price of $0.04 per share.
Part of the reason for the rather scary drop could lie with the promotion itself. Then again, the dreadful financial statement might also be playing its role. Here’s what SGBY had at the end of last year:
- cash: $2,866
- current assets: $7,678
- current liabilities: $74,037
- quarterly revenue: $4,813
- quarterly net loss: $25,376
Acquiring an operating medical cannabis testing facility with these sort of financials will be really hard, and it’s not like the members of the management team have a proven track record of performing miracles.
SGBY‘s CEO, for example, is called William Waldrop, and according to the Form 10 filed last year, he was once at the helm of College Partnership Inc. (now known as BlackStar Energy Group Inc (OTCMKTS:BEGI)). It’s fair to say that College Partnership’s business didn’t really take off, and when the company was still in existence, some of its customers weren’t particularly excited about the service they had received.
If you are still thinking about putting your money on the line, you might want to bear in mind that in October of last year, SGBY raised $17,500 by issuing 1.5 million shares at a little over $0.01 per share. 5 million shares saw the light of day at the end of 2014 in exchange for services valued at just over $58 thousand, and at the beginning of February, a further 1.2 million were sold at $0.0125 a pop.
The combination of discounted shares, a horrific balance sheet, and a paid promotion is a volatile one. Considering all the risks carefully is an absolute must.
