Will Windstream Technolog (OTCMKTS:WSTI)’s Bounce Last?
Windstream Technolog (OTCMKTS:WSTI) crashed horribly yesterday, but by the look of today’s green start, it may be able to recover some ground by the time of this week’s final bell.
Looking at its fundamentals, this recovery may well appear premature and unfounded. After all, the company’s latest financial report shows these extremely unimpressive numbers:
- Cash on hand – $594 thousand
- Total current assets – $5 million
- Total current liabilities – $9.99 million
- Annual revenues – $1.76 million
- Annual net loss – $11.3 million
Unfortunately, as bad as those numbers are, they aren’t even the biggest red flag that pops up when due diligence on WSTI gets done.
Searching for the word “convertible”, as in “convertible note”, in WSTI‘s 10-K for the period ended Dec. 2014 yields a staggering 172 results. Investors may want to take an especially careful look at those, as some of them describe conversion provisions such as “70% of the average of the three lowest Closing Bid Prices in the twenty consecutive Trading Days immediately preceding the applicable Conversion Date“.
Suffice it to say, these are not reassuring fundamentals, which is why it wouldn’t be surprising if this latest recovery ends up being a dead cat bounce.
