***FEATURED PICK ***HWAL***
I am announcing HWAL as my FEATURED PICK for a litany of reasons which I will detail in the coming post. Before I get into the semantics of the equity and the possibilities I wanted to clarify a couple of things. About a year ago I profiled a company called ECA(u), which ws extremely undervalued and had multiple reasons by which it would ascend to much higher levels. Additionally, I have been alerting tickers that were either 1,2 or fewer day plays, which, upon hearing feedback from many of my followers was not what they were looking for. Thus, I am going back to my FEATURED PICK alerts which are made to be played for a minimum of 2 weeks, or in this case as it relates to HWAL, longer term. Now that we have that out of the way, let's discuss HWAL:
Authorized Shares: 200,000,000
Outstanding shares: unknown
52 week high: $6.50
52 week low: .0015
Current price at time of alert: .0099
Price Target: ..10+
HOW WE GOT HERE:
The company has been expanding the revenue streams and business development. In order to accomplish this the company entered into some less than shareholder friendly financing deals. The most nefarious of which was a deal with Blackridge Capital which held in trust 9,000,000 shares as part of that financing deal. It was subsequently determined by company officials that either Blackridge, or their affiliates were mercilessly shorting the company stock, starting at levels higher than .10. Realizing the damage this was doing to the company's shareholders, of which the insiders hold a significant amount of shares, the executives attempted to negotiate with Blackridge to pay the convertible note in cash, and have the 9,000,000 shares returned to the company's treasury. DUE TO THE FACT THAT THE AFOREMENTIONED ENTITIES HAD ALREADY SHORTED, by my estimation, 10+ million shares, THE FINANCIERS REFUSED TO TAKE THAT DEAL. Here is where the story really starts to become interesting.
HWAL management filed a temporary injunction order prohibiting the Transfer Agent from transferring the 9,000,000 shares to BLACKRIDGE, so that they could be sold into the open market. The judge ordered that HWAL had to put $10,000.00 in an escrow account as well as the amount of money the 9,000,000 shares would have garnered at the current market price when they would have been registered to have been sold, which was approximately $75,000.00. That means, that HWAL had the cash to pay off the entire note, but BLACKRIDGE refused such payment. WHY you ask? They shorted the piss out of HWAL's stock.
HWAL was granted the temporary injunction and the stock languished, (without additional shorting I might add, until its' expiration on 10/27. Unbeknownst to HWAL executives, immediately upon the order's expiration, on 10/28, BLACKRIDGE immediately sent a demand of payment of shares to the HWAL Transfer Agent who subsequently transferred the entire 9,000,0000 shares to their account, whereupon all of the shares were dumped into the open market in less than 2 days. That destroyed the share price and until Thursday/Friday of last week, we hovered around .003.
HWAL GOING FORWARD:
Now that you know how we got here, what happens now? First off, HWAL is not hurting for cash. They will be getting back that $85,000.00 they put into the escrow account. Additionally, they are currently in a number of contract negotiations related to their video/entertainment library which should prove out immediately accretive to their bottom line. The CEO has stated that they will be applying for the NASDAQ next year and have total assets in excess of $65,000,000.00. Their low float of just 51 million shares is inclusive of the recent 9 million share dump BLACKRIDGE performed 2 weeks ago. On a fully diluted basis with over $65,000,000.00 in assets and factoring in a 200 million share basis, (the company will not be diluting for at least the next 3-6 months), that places an intrinsic value of HWAL at $.325. The preceding number is again, predicated upon a FULLY DILUTED 200 MILLION SHARE basis. If you were to perform the same calculations just on the 51 million share float, that implies a value of HWAL shares at $1.27.
HWAL FORWARD LOOKING CATALYSTS:
HWAL executives will be filing a significant compensatory lawsuit against BLACKRIDGE CAPITAL LLC over the handling of this 9 million share financing deal and the damage it has done to their shareholders and business dealings. Look for that announcement within the next 2 weeks.
Additionally, a number of projects they have been diligently working on are close to being finalized and that will add to their already significant bottom line. Combine the aforementioned with their paltry share structure and the disparity between today's price and the 52 week high at $6.50, and well, WE SEE TREMENDOUS UPSIDE FOR HWAL SHARES.
HWAL IN A NUTSHELL:
When taken in the totality of how far depressed the HWAL share price has fallen from the $6.50 level to just under a penny, with over $65,000,000.00 in verifiable assets, and now understanding how we got to these undervalued levels, one can easily see that somewhere between .01 and either .325 (at the low end) or $1.27) at the high end, HWAL SHARES ARE SEVERELY UNDERVALUED.