Umax Group Corp (OTCBB:UMAX) Aims for $2 Again

After nearly touching $3 per share on September 12, Umax Group Corp (OTCBB:UMAX)’s value got beaten down when five devastating sessions resulted in more than 70% in losses. Then, after a bit of consolidation, it managed to make another run from around $0.79 to $1.35 in just six days, but once again, it just couldn’t stand the pressure. A little over a week later it was standing back at $0.83.

At this point, we thought that the ticker will continue spiraling down towards the bottom of the charts, but having seen the recent performance, we can safely say that this is one of the more stubborn stocks on the OTC Markets. Yesterday marked the eighth green session in a row and when the closing bell rang, the price stood at $1.47 per share. This sort of multi-day movement is often witnessed in Pennyland when a company issue some exciting press releases. So, what sort of optimistic development has happened around UMAX lately?

Actually, nothing seems to be happening. As we mentioned in our previous articles, the business plan and management team went through an overhaul a couple of months ago and UMAX got transformed from a distributor of products for the gaming and entertainment industries into a reseller of nutrition and dietary supplements. The people who took the helm back in July, however, don’t seem too keen on communicating with the shareholders. In fact, the only information to come out of the company since the merger is the one found in the SEC filings. And it’s not particularly good, either. As of July 31, UMAX had:

• cash: $8,526
• current assets: $10 thousand
• current liabilities: $28 thousand
• quarterly revenue: $7 thousand
• quarterly net loss: $19 thousand
• number of issued and outstanding shares: 97,600,000

They did announce on September 16 that they have received proceeds of around $200 thousand by selling stock at $2 per share and they said that they might extend the offering by an additional $800 thousand but you would agree that even if they do raise a total of $1 million, their financial statement will fall way short of justifying the gigantic market cap which, at the moment, stands at just over $140 million.

Even if you decide to dismiss the horrific financial situation, the lack of any new information or developments and the fact that the stock at the moment is preposterously overvalued, you should still consider the ticker’s behavior.

If you take a closer look at the chart at the beginning of the article, you’ll see that it’s starting to look suspiciously similar to the ones drawn by North American Oil & Gas Corp (OTCBB:NAMG) and Indo Global Exchange(s) PteLtd (OTCMKTS:IGEX) during the initial stages of the promotional campaigns that ran for them. If there is a pump for UMAX, it’s currently going under the radar, but the increased volumes over the last couple of days certainly show that some people are paying attention. Of course, there can be no guarantee that a promotion is indeed in the making but, as we mentioned in our previous article, we’ve seen far too many ventures established with the help of the infamous Luis Carrillo and Wade Huettel go through the same treatment.

In any case, the risks at the moment seem substantial and considering them carefully is absolutely crucial.