ZAP (OTCMKTS:ZAAP) Bought Up Again at Lower Range
If you are looking for an alternative to MMJ stocks, ZAP (OTCMKTS:ZAAP) starts to look right, with its electric vehicle promise. ZAAP added a slim 2% on Monday, but the buying volumes spiked unusually high, to $1.27 million, as the ticker commands a rather respectable price of $0.21. 
But we must not forget that electric cars, along with hydrogen fuel cells, made up a minor bubble in the past weeks. This happened right after Tesla Motors, Inc. (NASDAQ:TSLA) announced a $5 million investment in a new battery factory. Several small cap companies spun this into promises of the bright future of electric cars, despite the lack of real products beyond the prototype stage.
The buying for ZAAP only returned after a serious correction, as the ticker slid from a peak above $0.37, losing rather rapidly in the first days of the downward trend. Now, the buying looks like taking up a bargain, and is supported by a new PR stating that ZAAP received 25 thousand pre-orders for its electric vehicles. Unfortunately, the company’s websites are still not clear about the actual availability of the electric cars and bikes.
Investors’ forums also express serious doubts about the actual sales, and point to a history of fake orders, just to boost the ticker price. On the positive side, ZAAP has not seen a targeted email promotion, but still it has shown the potential to rise suddenly. Now, the biggest danger is for newcoming investors, who would trust the company’s messages too much.
It would be a while until ZAAP could compete with Tesla and other producers for the electric car market. The latest round of financials shows that this OTC company holds serious deficits. What worries investors most are the deepening losses, as well as doubts if the company can be competitive and really make use of the electric car sales. This year is seen as a golden opportunity for innovative vehicles.
Too much enthusiasm proved toxic for the Hydrogen Future Corp. (OTCMKTS:HFCO). The ticker shot upward to a peak of $0.05 in just two short days, only to crash subsequently, losing 90% of its value to $0.005. HFCO also rode the initial wave of enthusiasm surrounding the potential of fuel cells and electric cars.
Hypersolar, Inc. (OTCMKTS:HYSR) survived a bit better, but still sank from its peak and is currently hovering around $0.03.
If you are looking for longer-term opportunities, keep in mind that the electric car sector shows signs of overheating on the stock markets, as tickers jump suddenly to unusual positions following positive news. Unfortunately, some of the news are without too much substance. In the case of ZAAP, the financials are a bit more solid compared to other contenders, but the price fluctuations still hold enough risk. ZAAP has created big expectations, and any lag in news and updates could bring down the enthusiasm. With a market cap of $66 million, ZAAP looks shaky, so invest accordingly, not relying too much on the positive scenario.
