US Energy Initiatives Corp Inc. (OTCMKTS:USEI) Doubles Its Value
US Energy Initiatives Corp Inc. (OTCMKTS:USEI) made its breakthrough on Feb. 3, when it announced that it was joining the medical marijuana business and jumped nearly 600%. Its momentum was somewhat stalled by a its crash on Tuesday, but that was more than compensated for by the 109.30% up they made yesterday.
Normally increasing your market value more than thirteen times over the course of just a few sessions is considered a phenomenal achievement. In this case investors are advised to take notice of the circumstances around the company’s sudden rise.
USEI has been in the bio-diesel business for a while, but has never been a top player. In fact until just a few months ago, the company wasn’t even making any revenues at all. Their latest 10-Q report shows some improvement in that aspect, but potential buyers should note that the cost of sales exceeds their revenues.
While it is true that USEI has more cash on on hand than some other pot stock companies, it certainly is not making money. The lack of activity on their charts is easily explained with the lack of commercial success. It is safe to say that their monotonous fluctuation under a tenth of a cent has only been broken by sharp spikes in activity after the occasional pump. All of those were inevitably followed by disastrous crashes.
The present case seems to be different. USEI‘s current climb is largely based on its announcement that it’s joining the legal hemp and marijuana businesses that are the hot new trend now. Indeed, the 600% rise in a single session was entirely due to the press release that hit the wire on Feb. 3. In it, company officials declared that, through their history of not making any money off of bio-fuels, they had somehow managed to amass “extensive relationships with legal growers, dispensaries, product developers, marketers, patent holders and other professionals in this industry”. How they managed to achieve such a feat remains unclear.
The Jan. 5 press release made even less sense. Though uplifting and optimistic, it doesn’t seem to contain much more in the way of information than the company’s excitement about the new Hemp Farm Bill. Furthermore USEI doesn’t even have approval for its commercial use.
Investors are jumping all over USEI stock, but they might want to spend an extra hour or two doing further due diligence before they hop on the green hype bandwagon.
Another company that managed a similar leap is Easton Pharmaceuticals Inc. (OTCMKTS:EAPH), who jumped 106.67% in yesterday’s session.
