SUTIMCo International Inc (SUTI)

[Kool Aid Man]

SUTI-->**NEW** HOTSTOCKED REPORT<--MONDAY 4/13/15

(QUOTE)

SUTIMCo International Inc (OTCMKTS:SUTI, SUTI message board) announced before Friday's opening bell that the management team is determined to patch up the share structure a little bit. In an effort to raise shareholder value, they said that they will be retiring 0.5 billion shares.

The same amount of stock changed hands during the session which goes to show that investors seem pretty excited about the announcement. With the help of a couple of promotional emails, they pushed the ticker to a close of $0.0005 per share.

Theoretically speaking, reducing the O/S count is bound to make the stock a bit more appealing, but is it enough to turn SUTI into a decent investment opportunity? Let's take a quick tour of the company's history and find out.

About a year ago, SUTI was headed by Fred Rogers and, as we mentioned in our article from March 20, 2014, he had something of a history of making numerous promises and then failing to deliver on them. A few months later, he stepped down and the helm was taken by Edward Vakser. Mr. Vakser's reputation, it must be said, isn't exactly spotless, either. His involvement with companies like ProTek Capital Inc (OTCMKTS:PRPM) and 3D Eye Solutions, In (OTCMKTS:TDEY) scared away quite a lot of investors. Probably because of this, Mr. Vakser also decided to leave SUTI and a certain Luther Jeffries agreed to give it a go at steering the company.

The shareholders hoped that they have finally found a solid CEO who perceives SUTI as a serious undertaking, but unfortunately for them, Mr. Jeffries had other ideas. At the end of last month, he announced that he intends to pursue other projects. We don't know what these projects are, but we do know that on April 3, various news websites informed us that Mr. Jeffries has been arrested because, according to the police, back in 2006, he stole about $20 thousand from a Family Dollar store.

Now SUTI is being led by a person called Jarrod Turner and once you take a quick look at the latest financial report, you'll notice that he has his work cut out for him. At the end of Q3 of last year, the company had:

cash: $198
total assets: $4,375
total liabilities: $3,961,191
NO revenue
net loss: $553,858

Digging the company out of the financial hole that it's in at the moment will be anything but easy. Nevertheless, we should note that, theoretically speaking, anything is possible. All we can do is wish Mr. Turner the best of luck, and all shareholders can do is keep their fingers crossed.

They should bear in mind, however, that stabilizing the balance sheet might not be enough. They mustn't forget that SUTI is a triple-zero stock and they should know that there's a very good reason for this. It's called dilution.

The latest report tells us that over the years, the company has borrowed money under some pretty appalling terms. Numerous convertible notes can be turned into common stock at either a 50% discount to the market price, or $0.0001 per share, whichever is lower.

During the first nine months of last year, the company issued more than 3 billion shares as a conversion of debt and the latest report tells us that on September 30, there was about $388 thousand worth of notes still outstanding. By the looks of things, some of that amount has already been converted.

On October 3, 2014, SUTI executed a 1 for 100 reverse split (an action that wasn't accompanied by a press release or a filing) and brought the number of issued and outstanding shares from around 5.2 billion to 52 million. According to the company profile at the OTC Markets, on January 13, the O/S count was sitting at 605 million. In other words, in a matter of just over three months, SUTI's stock was diluted by about 1,000%.

In light of this, you should have no problems answering the question we posed in the second paragraph.

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