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Options traders are running up just about every small stock on the whole market. In normal times, this is not a 150M company... but these are not normal times. As for where it goes... who knows.
Cargile's Tenure -
He takes over a run down company that was basically a glorified ponzi scheme, and his plan to save it doesn't really go well as the former owners left him with a bunch of BS to be responsible for. The company had a tough time raising money, and had to rely on some debt with fairly onerous terms. They are losing money and looking like it's about to go bankrupt. Then suddenly... COVID! The markets go nuts with stimulus and excess savings from at home workers and then a giant pile of money appears and he ends up leaving the company in fairly good financial shape. They could probably keep raising money and not even hurt the share price that much.
Apparently every $1M in cash they raise = $3M in market cap... infinite growth potential lol!
The price of the warrant should adjust to the lowest price that the company dilutes at, supposedly. From what others have posted, this might not be going on. Splits should not have any economical effect on the warrant. If you own warrants, try contacting the CFO (pmcdonnel@sunworksusa.com) and see what you find out. If this doesn't work you might need to look into other avenues to compel access to this information.
You have plenty of rights under the contract - get together with other warrant holders and get a good broker or lawyer to enforce them. If that is not feasible then it's probably best to just write it off as a total loss.
Trusting the company to pro-actively enforce arcane rights when they are close to going broke is a losing proposition. What is the consequence for them of just doing nothing? Most likely the small retail investors they have been screwing for years with zero consequences will just take the abuse again.
There should have already been an adjustment again already, the share count went way up since the 10-Q, and the price was lower the entire time. I don't hold warrants so it's nothing to me if they play games with warrant holders, but if I held large numbers of warrants I would certainly take positive action to ensure the contract is enforced strictly. I considered buying the warrants at one point, but I don't feel like also hiring a securities lawyer to represent me, which I think would be necessary.
This is a precarious time for anyone with any ownership in this company. Keep in mind it is in the interest of the management to dilute as much as necessary to pay off the bondholders (because they are the bondholders). They have already diluted a lot, and will need to dilute more. I think the 8-K put the most recent share count above 30M shares, up 50% from just a few years ago. The warrants make it more difficult for the company to get that capital, and therefore I think it would be foolish for warrant holders to trust the company to do things right by them.
Delaying the time that the rate of conversion is adjusted would allow the company to slowly walk down the share price and sell into any volume generated by the market, which is what it looks like to me they have been doing so far.
It's up to you to figure out for yourself whether the management is more interested in paying themselves back, or fulfilling arcane (but important) covenants of a warrant contract owned by small retail investors posting on Ihub.
Whether or not you think management has integrity, very little of they have promised has ever come true, it has always been the opposite.
Yeah actually probably lower now, but that is what the price was at end of June. Company sold more shares in July at an average price lower than that, but I don't know what the lowest price was.
Warrants now exercise at $0.56 a share, in case anybody wants to know.
Law of diminishing returns is in effect. Putting out carbon copy PR's related to every minor project the company get's is starting to wear out again. Too bad their best opportunity to raise money was wasted on a pump and dump in a failed bid to stay on Nasdaq without a R/S. That generated a ton of bagholders from $1-2 who will be putting selling pressure on this in addition to the millions of shares the company is selling on the market right now.
Proxy share count shows dilution of 1,089,972 shares since mid-May.
From 10-Q:
It depends on what the price the company sells their shares for into the market. Every time they sell shares at a lower price than whatever the warrants price is, a new strike price will be set.
Important (good) news for anyone crazy enough to still be holding warrants:
Also Abe has another new company - looks like direct competition:
https://newgenenergy.com/team/
From my reading of the contract, this is in violation of his contract with Sunworks, but from my understanding, the company is not inclined to enforce this for whatever reason.
Looks like another Sunworks founder (Emil Beitpoulous) is out: https://www2.cslb.ca.gov/onlineservices/checklicenseII/PersonnelDetail.aspx?LicNum=441690&SeqNumber=796971&LicName=SUNWORKS+UNITED+INC
I can't tell you the exact timing I am just basing it off this quote from the conference call:
The company is probably weeks away from doing a below market offering in order to pay off debt. The toxic notes were likely sold during the last run up a few weeks ago however. The old warrants that converted at $4.15 before will convert at whatever the offering price is, adding a significant amount of dilution on top of whatever the company raises.
Enjoy the ride up and don't short it, certainly not yet anyways...
...but don't forget this is all about trying to raise money to pay off the loan next year.
I've said before that the best time to go long certain companies is right before they would go bankrupt. First of all you can squeeze out shorts who foolishly invest based on things like fundamentals alone. Second, time and time again these types of stocks surge upwards just before they need to raise money.
That shelf offering tells you everything you need to know, dilution is coming and it's going to hid hard and fast when it does. Just to pay off the loan will probably be around 25-30% dilution. Cash is perilously low. Even without the loan working capital is in the red, and it looks like the company has had trouble finishing up some of their jobs based on Q1 results. In order to get enough cash to operate properly after that will likely be more. The CEO is personally on the hook for that loan, so it's not just the company that might go bankrupt if the offering doesn't work. None of this matters in regards to the share price on the way up. All of this promotion isn't about getting to a certain price, it's to create trading volume in order to demonstrate a viable and deep market for the stock so those participating in the upcoming below market follow-on feel they can conformable dump their shares ASAP onto retail investors.
The people getting in (and back out) now are short term traders who buy based on some random lines on a chart drawn by some fake guru who gets paid on the side by the companies he talks about.
The day after a massive shelf offering when the company is desperate for cash is as good a day as any for two PR's in two hours. Looks like volatility is going to stick around for a while.
Update to post 62576 - 4/10/19
https://investorshub.advfn.com/boards/read_msg.aspx?message_id=148143990
Curious to hear the thesis to justify $5+
It certainly has the potential to do so, this stock is in a stage where most of the people buying it and trading it today probably don't even know that they install solar panels. Which makes it completely erratic and unpredictable, but of course those situations create opportunities all around.
Somewhat... this company is much smaller than some of the others that get moved around like NBEV, especially since volume was so low before. Even today, already the highest volume day ever I believe, only has a cash volume of a few million $. A company this small can be totally run up in the short run. Management could throw fuel on the fire by releasing a PR about whatever... but so far they have been totally silent which I find interesting.
This law firm has been working with Lei back into the 00s. For more recent stuff look up Mabvax and Barry Honig and their former partner Harvey Kesner. Also Riot blockchain and MGT, the list goes on. Like I told someone else this isn't illuminati masons, it's just some guys paying some other guys to market stocks using less than orthodox tactics. And it's really not impossible to figure this out on your own, it is just nobody tries. Just email a ton people and some of them will talk to you for all kinds of reasons. A lot of these promoter guys are not smart, they are paid not because they are great writers but because they are willing to lie and break the law. At least one did some jail time after he exposed himself out when I informed him of his lack of disclosures. It was a short sentence and he is already back to doing it again, but probably more careful now.
Obviously dont take my word for it, go to Edgar full text search type in "sichenzia" and then cross reference the companies associated with them to SEC fraud investigations and other shenanigans. You will be busy for a long time, I was!
Thats not the words I would use when referring to their balance sheet, but you arenvt far off the mark. This rally is an artificial promotion driven by, in my opinion, the Sichenzia Ross Ference law firm. I think that because I have seen stock promoters promoting Sichenzia clients as a group. The list of frauds they are associated with is continuously growing so to have them boosting this should be a strong indication of the dangers here. Their promotions typically accompany a capital raise with either Chardan, Maxim, Craig Hallum or Roth. This is usually really bad for long holders. The promotion could also just be a way for Lei to unload his last stake through Boden. Let's wait and see what happens. There is no fundamental reason for this rally, certainly not from the lackluster 10-K which included bad guidance for Q1.
However this is why I do not short nor recommend anybody short Sichenzia clients. The poor quality of their clients are enticimg to shorts, who underestimate the high quality of their stock promotion ability.
Nobody has mastered the art of mass mallocation of capital more than Greg Sichenzia.
Much fewer new "investors" as it got in the few days before this. The investors gained in the last few days are mostly penny traders and will likely add some selling pressure as they shift their attention. I have no idea if the promotion is over or not, but without more new investors bidding this up, it's probably going to stall out with moderate declines in the next few weeks. Earnings is due pretty soon so that should provide a chance for the stock to begin to realign with fundamentals (whatever they end up being).
The big takeaway is that the gains of the last weeks were driven by huge amounts of new investors suddenly entering the stock, not as a result of any fundamental changes.
https://robintrack.net/symbol/SUNW
Likely stock promotion ongoing. I am still putting stuff together, but I strongly believe there are behind the scenes paid promotions going on right now. I can say for sure that:
- People who often get paid to promote stocks are suddenly talking up Sunworks.
- I can say those people are promoting at least four other companies (TROV, TEUM, BPMX, and RIOT) these companies are all tied to a very important third party service provider to SUNW.
- A lack of a catalyst that would explain record volume. The lack of bad news could explain a slow recovery on light volume, but not this.
Forewarned is forearmed!
Great tool. Double number of owners in about a month with no real news. Draw your own conclusions.
https://robintrack.net/symbol/SUNW
I have a very difficult time valuing the company because so much of the potential evaluation is caught up in whether the turnaround plan works on not.
In the previous years poor (in my opinion highly unethical) management decisions weighed heavily on margins and caused a lot of damage. The question is whether the business model was sound, but weighed down by bad management, or if the business model is fundamentally untenable to begin with and was just a smokescreen for management looting.
The last two years were spent by Chuck basically trying to prove that the business model was and is sound, and once it is run more professionally, then results will follow. Nothing drastic was changed in the business model, it's basically Sunworks 1.1 (now with less corruption!)
This is showing some success and the company is getting closer to viability. The problem is that money is getting tight again, and access to additional capital starts to become an issue. So things like the weather and the timing of large projects start to become very important, and those things are impossible to predict. In short, uncertainty and living with ambiguity will decide the future for at least the next year.
It's nice to see people get excited about $0.70!
Though remember the new management is focusing on profits as a benchmark, which is great because they will need to earn some profits in order to repay that loan in one year. The focus on revenue at all costs is what got us here in the first place (near bankruptcy).
Thanks, and I will say that I don't blame SUNW or management for what I think happened in the last few days. I was just trying to figure out why the stock surged on high volume out of nowhere. We will see when the 10-Q comes out if I am right or not, this is just my best guess for now.
This isn't that. These rooms are set up by "trading gurus" who are basically fake experts pretending to know how to trade, and charge suckers who are stupid or inexperienced enough to fall for it. It's basically the same as all those penny stock newsletter sites that used to be common a few years ago. These guys are often paid by IR firms to issue "trading alerts" about certain stocks.
This stock is being promoted in Discord chat rooms, usually behind a paywall. I won't link to the rooms here since they are mostly platforms for scammers, but you can find them easily from their self-promotions on other platforms. This is the new form of those cheesy penny stock email promos. Basically they went from scamming boomers to scamming millennials. Many chat rooms began promoting the stock at the same time. This is a strong indication that there was paid stock promotion. I have suspicions of the source, and I don't think it was management. For now just remember this post, and be sure to check the upcoming 10-Q for any conversions of convertible debt around this time. I do not think it was an accident that the promotion began just after the filing of the 10-K.
Yeah it's quite remarkable, only catalyst I've seen reported was the Zacks upgrade... but Zacks ratings aren't really official coverage, just algo spam. Let's hope Mr. Boden doesn't decide to smash this rally with his last batch of shares, it's getting pretty close to the $1.00 threshold and I would assume it will be easier to do that now rather than after Q1.
Haven't seen any cheesy promos or the like driving this, but something is driving new Robin Hood investors into this all of a sudden.
https://robintrack.net/symbol/SUNW
Since Robin Hood users are mostly millennial day traders on smallish accounts, this could indicate that the stock is getting talked about in Discord chat rooms which aren't exactly places where solid fundamentals allocate capital.
Correct, records show house associated with this guy:
https://www.linkedin.com/in/scott-bowden-2112274/
He has been in that role since Dec 2017.
Read a little closer. It looks like $15M market cap might be the magic number actually to get the extension. Market cap currently 15.006M. Interesting trading opportunity here if you assume someone is willing to spend a lot of money to keep it at this price...
It's not really a new company though. New people yes, but same company. With what I've learned recently I am more convinced than ever than the company was a deliberate scam from the very start, before Nelson was even hired on. Nelson may not have known it was a scam from the start, but he certainly knew before the end. Nelson, I believe, deliberately and effectively cooperated with a few individuals in Santa Barbara and Lake Tahoe to rob shareholders. The skeletons cannot be ignored forever. My own prediction is that as they start being dug up thanks to these guys getting involved with Trump campaign manager Parscale and bringing more attention to themselves, nobody serious will want to have anything to do with Sunworks as a public company (CFO resignation anybody?)
Just because current management wasn't involved in perpetuating a fraud does not absolve the company from perpetuating a fraud. And it was a deliberate fraud run in secret by a convicted felon securities fraudster. The company is basically uninvestable for this reason.
By the far best hope of recovering your investment lies in the legal system, not the financial markets.
Even without this rumor, anyone with a significant investment in this should be feeling some anxiety right now. The situation remains extremely precarious.
It's still potentially problematic. Wasson held a general engineering license, which means Sunworks did too while he was working there. That is why it says on the page that Sunworks needs to add someone with that license to retain it. The problem is, Wasson wasn't actually supposed to be on the license at all ever because he wasn't associated with Sunworks, if what I heard in 2017 was true. Right now the license improperly has Wasson leaving in December, which is not correct based on that.
Contractors license is valid again, gap seemed to be due to Wasson being on the license improperly. Finally fixed after two years.