Traders Have High Expectations For MediSwipe Inc (OTCMKTS:MWIP)

MediSwipe Inc (OTCMKTS:MWIP) announced on Wednesday that the delayed conference call with the shareholders will take place today. The webcast was first scheduled for July 1, but they decided to postpone it by a week due to some organizational problems and hopefully, around 4:00 PM Eastern time today, MWIP‘s stockholders will have the chance to hear from the company CEO, Mr. B. Michael Friedman who is supposed to talk about the revenue models, the developments, the signed contracts and all that the future has in store for MWIP.

We’ve seen our fair share of conference calls like this one, and one thing that is common among all of them is that no matter how angry the stockholders might be, the officers presenting the management team are always doing their best to spread some of their optimism among the people. We’ve seen some interviews of Mr. Friedman and we can see that he is quite optimistic about the whole thing so we’re pretty sure that he will try to convince the shareholders that there’s absolutely nothing to worry about. This begs the question: “If Mr. Friedman is 100% sure that the future is bright, why did he sell so many shares back in January and February?”. The disposition of the stock was suspiciously well timed with a few promotional emails for MWIP and the effect on the price was particularly ugly on February 13 when the ticker lost around 14% of its value in a single day. Back then the price was hovering around $0.09 per share, while after closing Friday’s session around 5% in the green, it stands at around $0.047.

We’re not sure what exactly Mr. Friedman is going to say later today, but from what we can see in the filings so far, we can say that the future is anything but certain for MWIP. Until about a year ago they generated their revenues through electronic merchant cervices for medical institutions but back in July 2012, some problems with the VISA and MasterCard payments emerged and they had an adverse effect on the company’s situation (which, by the way, was already a bit shaky).

The first thing that you see when you open MWIP‘s website is a banner that reads “Helping your medical business become more profitable”. We’re not sure why they picked up this particular motto since MWIP themselves have had some difficulties turning profitable. They have yet to end a quarter with net income and below you can find the figures presented in the 10-Q for the first three months of 2013:

• cash: $9 thousand
• current assets: $34 thousand
• current liabilities: $370 thousand
• quarterly revenue: $49 thousand
• quarterly net loss: $248 thousand

Hopes now lie with two main sources of proceeds – their brand new, state-of-the-art Data Management System (DMS) for medical marijuana patients and the exclusive distribution agreement with a manufacturer of hemp infused energy drinks. Unfortunately, the distribution agreement was signed in April and the installation of the first DMS application was announced back in May which means that the shareholders will need to wait until the next 10-Q before they can see the results for themselves.

In the meantime, if you are contemplating a potential MWIP investment, you might want to take into account one or two things. The first one is, of course, the promotional history. Currently, there are no traceable campaigns for MWIP and the last emails that we received on them are dated May 7. Yet, we’ve seen that over the last half a year or so, the ticker has become a favorite with the pumpers and there can be no guarantees that MWIP will remain immune to paid touts in the future. The charts for American Graphite Technologies Inc (OTCBB:AGIN) and Lot78 Inc (OTCMKTS:LOTE) on the right illustrate pretty well the effects that artificial hype usually has on the stock performance.

Another thing to keep in mind while weighing the risks of a potential investment in MWIP is the affiliations of some of the members of the management team with other penny stock ventures. If you do a quick research on the company CFO, Mr. Barry Hollander, for example, you will see that he is also listed as the CFO and Treasurer of SurgLine International Inc (OTCMKTS:SGLN) – a company that has the skull and crossbones badge on their OTC Markets profile and a temporary trading suspension dated September 17, 2012 due to some questions regarding the accuracy of the information contained in the official filings. In case you’re wondering, it was Mr. Hollander’s responsibility to ensure that the everything in the documents is 100% correct.