Strategic Global Investments, Inc. (OTCMKTS:STBV) With Another Record-Breaking Surge

Seven days ago, the stock of Strategic Global Investments, Inc. (OTCMKTS:STBV) suddenly woke up and skyrocketed towards the loftier end of the charts. In just one session, the ticker managed to shift around $856 thousand worth of shares while the price jumped from around $0.0025 all the way to more than $0.01 per share.

If you check out our previous article, however, you’ll see that the climb was something of a mystery. There weren’t any new press releases, updates or even pumps that could justify the sudden and violent run in the right direction. Probably that’s why, the surge proved to be extremely short-lived. In fact, in just four sessions, STBV managed to incinerate nearly 70% of its market cap. It closed last week’s trading at $0.0032 and it looked like it will be left to wither in the double zero territories.

Yesterday, however, STBV made another huge surge. It opened the session at $0.008 (a whopping 150% above its previous value) and during the first few minutes it looked like it was going above the $0.01 per share mark once again. It hit an intraday high of $0.0098, but then, it simply ran out of steam. When the closing bell rang, STBV was standing at $0.0055 which is still a hefty 70% above its previous close, but the volumes generated are far more impressive. In just six and a half hours, the ticker managed to shift nearly 470 million shares which means that the trade value exceeds $3.1 million.

Some people probably think that the history from February 3 is repeating itself, but we should note that there is one major difference. This time, there is a reason for the massive stir. A couple of reasons actually.

First, just minutes before the opening bell, STBV said what everyone wanted to hear – that they’re entering the marijuana business. Apparently, they are carrying out what they call “meaningful negotiations” and if they manage to reach an agreement, they will acquire a marijuana growing facility located in Teller County, Colorado.

One hour later, Information Solutions Group (ISG) sent out an email alert on STBV. As you might imagine it’s full of optimism and the fine print under their expose states that ISG have received $10 thousand for their efforts.

All in all, there was no shortage of factors contributing to the hype and excitement, but unfortunately, we can see some problems.

The paid pump in itself is a big enough cause for concern. If you take a look at ISG’s track record, you’ll see that their previous picks didn’t perform too well. In November, for example, they touted Arrayit Corp (OTCMKTS:ARYC) – a ticker that was hovering around the $0.70 per share mark. Yesterday, ARYC closed the session at just $0.31.

Will the same thing happen to STBV? We’re about to find out, but, as we mentioned in our previous coverage, their balance sheet certainly isn’t solid enough to support the inflated market cap.

And even if you take a closer look through yesterday’s press release, you’ll see some details that are not entirely convincing. STBV are currently carrying out negotiations about the acquisition of the marijuana growing facility, but they are keeping pretty quiet about the source of financing that they’re going to use in order to pay for it (which, considering the dreadful balance sheet, is pretty important). And even if they do somehow manage to raise the money and complete the purchase, the new business won’t start generating revenues until the third quarter of 2014. This is nearly five months from now and five months is a very long time in Pennyland. Be sure to keep this in mind while evaluating the risks of a potential investment.