Terra Tech Corp (OTCBB:TRTC) Trying To Get Back To Its Former Glory
There aren’t many penny stock companies that can brag about being featured in a news segment at CNBC. Terra Tech Corp (OTCBB:TRTC) is one of the few such ventures, but instead of the media giant focusing on the huge growth that TRTC have displayed, they talked about the Financial Industry Regulatory Authority (FINRA)’s recent warning about the threat of medical marijuana stock scams.
In the interest of fairness, we should mention that CNBC didn’t point their fingers at TRTC accusing them of any sort of misconduct, but they did feature the ticker along with the ones of Cannabis Science Inc (OTCMKTS:CBIS), CannaVEST Corp (OTCBB:CANV) and Converted Organics B WTS (OTCMKTS:COINZ) on a list of pot stocks while talking about medical cannabis ventures that may never reach profitability. But why, of the hundreds of companies in the marijuana industry, did CNBC choose TRTC to be on their list?
Well, on January 2 the ticker was standing around $0.46. By contrast, on August 2 it was hovering around $0.07. This means that in just seven months, around 84% of the value has been wiped out and it also means that TRTC has been a long way off the performance of a future medical cannabis giant. What is the reason for this?
Well, there could be a lot of factors and we’ve discussed most of them in our previous articles, but we’re quite sure that the promoters, who have sent out around thirty emails during that period, have certainly played their role.
Still, the latest TRTC alert to hit our inbox is dated April 2 and despite the lack of a paid promotion, the ticker has been on a winning spree over the last nine sessions. The price has more than doubled since August 20 and while the pumpers are not to blame this time, there is still a very good reason for the sudden surge in the right direction.
It’s actually the second quarter financial statement that came out in the afternoon of August 19 and it has created quite a stir. TRTC themselves were quick to point out the massive growth in revenues and they even announced a meet-and-greet event at their New Jersey farm. Truth be told, even we were rather surprised by the progress displayed by the sales department but, as always, it’s not all good news. Here’s a recap of the most important financials as found in the latest 10-Q:
- cash: $169 thousand
- current assets: $1 million
- current liabilities: $4.3 million
- quarterly revenues: $665 thousand
- quarterly net loss: $1 million
When you compare the current financial statement with the ones from quarters gone by, you’ll see that the current assets as well as the revenues have indeed grown by quite a bit. Unfortunately, the same goes for the current liabilities and the net loss. The gross profit margin has also shrunk and, although the management team say that this is due to lowering the prices in order to raise more cash, it pushes the concept of profitability further and further away.
In addition to this, the increased trading volumes suggest that there’s quite a lot of buzz around the ticker and while there isn’t a full-fledged promotional campaign (which is more than can be said about other penny stocks like Affinity Mediaworks Corp (OTCBB:AFFW) and Skyline Medical Inc (OTCMKTS:SKLN)), TRTC‘s history of huge and scary drops suggests that the excitement could prove to be too much at any point. Make sure you have this in mind while reviewing the company’s progress and contemplating your next move.
