Virtus Oil and Gas Corp. (OTCBB:VOIL) Gets Pumped To New Heights
Nearly nine months ago Virtus Oil and Gas Corp. (OTCBB:VOIL) abandoned their previous business plan of offering a type of fast food called Currywurst and decided that they will be much more successful in the oil mining industry. The company acquired their current name and ticker and even entered into an agreement for the purchase of two oil and gas leases. Unfortunately investors refused to even notice the company and since then their stock has seen almost no trading.
Last week though VOIL suddenly started registering impressive volumes. On Monday 150 thousand shares changed hands which resulted in a gain of 24% and a close at $0.92. The positive performance continued for the next four sessions and at the end of Friday’s trading VOIL was now sitting at $1.28. So, what was the reason for the drastic change in investor sentiment?
The answer is quite simple – a paid pump. For now the promotion is carried out through a landing page touting the company. Despite the fact that the landing page doesn’t disclose the total budget for the campaign and that currently there are no newsletters sending email alerts the pump has been extremely effective – VOIL now commands a market cap of over $61 million.
Such a massive number is grossly disconnected from the reality of the company though. VOIL is in a dire financial state and at the end of February had:
- $62 889 cash
- $63 462 total current assets
- $101 thousand total current liabilities
- ZERO revenues since inception
- $700 thousand net loss
But the red flags don’t stop there. In order to finance their operations VOIL have issued quite a lot of discounted shares to a company called Fieldstone Industries, Inc. In August, 2013 Fieldstone bought 150 thousand shares priced at $0.33 but just a few days later VOIL performed a 14-for-1 forward split turning those shares into 2.1 million priced at $0.02. Since then VOIL have sold another 2 million shares at $0.40 which is still nearly 70% lower than the current market price. Another thing to consider is the fact that on June 20 the CEO of Virtus Oil and Gas filed a Form 4 according to which he bought 28 million shares for just 7 cents each.
It should be obvious that VOIL is an extremely risky stock. The company has still not completed the purchase of the oil leases and they will have to pay another $100 000 before August 3 followed by $75 thousand prior to September 28. Even if they do manage to find the these funds according to VOIL‘s own filings they will then need to look for another $2.5 million in order 
to build the test well on the property.
to build the test well on the property. The pumped stock of Windstream Technolog (OTCBB:WSTI) suffered a devastating crash at the end of last week. After climbing up the chart for a couple of weeks pushed by a hard mailer touting their stock WSTI reached price levels above $2 per share that weree far too unstable. On Friday the company wiped close to 35% of its value and dropped down to $1.35.
