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Remember that, as an asset, American Vaporizer could have been losing VPOR money. It could have simply been a shell used by VPOR to offload company liabilities/debt. Both American Vaporizer's assets and liabilities were transferred with the sale.
If American Vaporizer contained net debt, it would make sense for VPOR to actually PAY S.E. Naples for assuming the debt (hence agreeing to pay him interest on a promissory note).
Also note that VPOR's Q2 earnings were not consolidated with American Vaporizer's financial statement for the purposes of the 10Q:
"American Smoke, for ninety (90) days. As a result of the Sale, American Vaporizer ceased to be a subsidiary of the Company, and the financial results of operations and financial statements of American Vaporizer are no longer consolidated with those of the Company in this Quarterly Report. "
Thus, everything you see in this 10Q deals with Vapor Group's income statement SEPARATE AND APART from American Vaporizer.
Bottom line reduction from 245k net loss in Q1 to 140k net loss in Q2 during a period of heavy expansion.
Neglible dilution of ~9.1M shares.
Sale of American Smoke: not sure what to think here. Question is what proportion of gross profits came from the sale of American Smoke products vis-a-vis other product lines?
Took a position today at 0.052. What do we have to look forward to news wise in the next couple of weeks?
Pretty big disappointment. I have been in this stock since mid-May. Sold my position today. Lots of opportunity costs. Up 25% though... I suppose I can't complain. That's better than the market as a whole that's for sure! Good luck to all, perhaps the Q2 will be more friendly/timely.
0.0994...
Keeps retracing to higher lows. First 0.095, then 0.0955, now 0.0958.... It's been glued to the HOD all day long. All the signs are there to break a nickel and head for 0.125
Hitting 0.099 as we speak
Float: 132M
O/S: 256M
A/S: I believe was raised to 1.3B in March but no signs of dilution at this point.
I like these incremental gains, a higher starting point for a nice pop is ideal. Less scary to day traders. I hope we can hover around 0.15 by Friday, with Qs dropping and then a nice 50-100% pop on Monday.
0.10 is the psychological resistance, 0.125 is the real resistance. 0.125 close tomorrow is a real possibility.
have spent so much in opportunity costs on this stock, it's about time.
Beautiful day so far guys, the chart is beginning to look like a stair case. Patience pays with $PAWS. I wonder if she plummets or rockets Friday afternoon if no Q has dropped by then.
I sold 77k at 0.084 today and bought right back in at the same price a few hours later. Thought I'd go for the quick flip but couldn't even last the day. I've been with this stock since mid-May and I'm not about to give up big numbers for a small 10% gain after all this time. I've never held onto a penny for this long. I have a feeling patience pays with PAWS.
Steep rise in revenues doesn't necessarily mean a rise in net margins. Worst case is the past few months they have made their major push to achieve scale and have increased their operating/marketing expenses disproportionately. What worries me most is the 20% factoring rate, which is worst than the 25-35% they were receiving in parts of 2013.
Nice DD on the P/E ratios. 60 seems SO high though I just can't believe it. I think that's mostly due to companies with R&D sectors who can gap up huge due to new patents, but maybe not.
Even with a net loss this Q I still think we maintain current levels. The growth investors are going to react to this huge rise in revenues even if they aren't fully reflected in cash inflows at this point. When your billings start rising exponentially like this the company becomes bigger than the sum of its parts. There is some smart restructuring going on right now.
Some rough numbers:
If we can maintain 230k net income for every 15M gross sales:
At 90M in sales, that's 230k x 6 = 1.38M
1.38/230M(current O/S) = 0.006
P/E: 0.085/0.006 = 14.1 P/E ratio
Relatively high average P/E ratio in pharmaceutical industry. so a conservative P/E ratio of 25 would bring us...
0.15 per share
That's just maintaining current net income levels relative to gross billings. Does not factor in what growth investors are going to do when they see that an OTC upped its gross billings 6 fold since last year...
Also, if the company can solve this factoring issue those numbers SKYROCKET. Net income of 10M a year would bring a share price of $1 at a 25 P/E ratio.
"As additional compensation, the Company also pays TPS 17.5% of the gross amount of future qualified prescriptions billed and shipped by the Company"
Nobody knows which prescriptions are 'qualified' and which are not. This 17.% could be peanuts... No use speculating about it.
Chart indicators are all favorable for momentum plays:
Broke key 3 month resistance levels yesterday (0.08) and closed close to these
50sma recently broke 200sma
2 months of trading sideways = consolidation
If it can break February/March numbers we are looking at a cup and handle formation.
Even with factoring, the company's growth in revenues are huge. There is value investing and growth investing and this is definitely the latter. Bottom line profit will catch up with growth in sales, investors know this. This is a capital restructuring move. PAWS is in a seriously hot market.
I also wish we had more info about this line:
"On June 1, 2012, the Company entered into an agreement with a factor that provided, on a non-recourse basis, an exchange of approximately
$2 million of financing for the factoring of $10 million in receivables aging from 2009 to 2011. In connection with these sales, the Company recorded financing costs of approximately $2.6 million during the year ended December 31, 2012 within the caption titled “Interest Expense” on the accompanying statement of operations. Under the agreement, the Company agreed to sell to the factor 100% of the gross amount of each receivable. As collateral for the Company’s obligations under this agreement, the Company has granted the factor a first priority security interest in all of the Company’s receivables. The Company also provided the factor with a first right of refusal to purchase future receivables"
Which sounds like they are locked into this particular 3rd party for future factoring, probably at a set rate, which is why they had to take the 20% rate in 2014 yet again.
Worst case it means that the 3rd party has a right to purchase the A/Rs EVEN if the company did not need the short term cash. I doubt this is the case though.
I think that this line from the 8-K/A describes the factoring situation:
"Following June 1, 2012, the Company factored an additional $8.9 million of its prescription billings generated in 2012, to multiple agents for net proceeds of $2.9 million. The receivables have been sold to factors at rates ranging from 25% to 35% of the gross billings. These receivables have been determined to have a net realizable value of approximately 46% of the gross billings for the year ended December 31, 2012. The difference between the estimated net realizable value of receivables and the factored amounts has been classified as financing costs under Interest Expense."
It looks like the factor (3rd party purchasing the A/Rs) only realized 46% of the value of the gross billings anyhow. Which is to suggest that had PAWS not factored, it too would only have realized 46% of the gross billings.
So really, if it sold the A/Rs for 30% on average, and the factor only ultimately realized 46%, PAWS only sacrificed about 16% of its billings in exchange for the money up front, which seems reasonable to me.
In a broader sense it seems like the company is undergoing capital restructuring. Sales are increasing exponentially, and the company is making a move to command a bigger portion of the market share while demand grows.
In the longer term the company achieves an economy of scale and hopefully builds up valuable good will.
This move into a public shell looks like an attempt to find alternative financing to factoring. Why it has so much trouble securing a traditional loan and/or line of credit is beyond me. As a bank I would take one look at the growing billings and hedge any risk of faulty payments by increasing the interest rate and taking out a first priority security over PAWS' assets. The problem is PAWS has little to no asset base outside of its A/Rs... Hopefully in the future they can diversify by investing in something other than operations.
Hopefully with this exponential growth in sales this factoring business does not have to go on much longer.
"As additional compensation, the Company also pays TPS 17.5% of the gross amount of future qualified prescriptions billed and shipped by the Company"
Only 17% of the billings for insert-text-here prescriptions, not all prescriptions. This could be only one drug line with constituting a very small line of gross revenues.
Decrease in factoring in late 2013 means they no longer had to use future accounts receivables to pay off short term liabilities. Means they had more cash in the bank and not sacrificing their money by selling accounts receivables at a fiscount.
Or better yet, the CEO himself, who received 60,000,000 shares just two days before the major dump.
"On March 26, 2014, the Company issued 60,000,000 Common Stock shares to Daniel Wiesel and Alysa Binder, both officers and
directors of the Company, pursuant to the exemption provided by Section 4(2) of the Securities Act of 1933."
That being said, March 27th there was a market wide dump in MMJ stocks following PHOT's suspension. PAWS has been given a lot of exposure by MMJ investors, so it could have been a baby getting thrown out with the bath water, so to speak.
Honestly though. March 27th was a horrendous day for a lot of OTC companies.
Here is a good comparative for $PAWS
http://www.marketwatch.com/investing/stock/axgn
10Q: http://www.otcmarkets.com/edgar/GetFilingPdf?FilingID=9950937
Revs of 3.1M per quarter
Gross Profit of 2.4M per quarter
Net Loss of 4.2M per quarter
Asset base of 24M
Much lower A/S and O/S but it's market cap is at a healthy 44M.
Remember it's not all about gross sales. Not only could Dan have been employing lax/sketchy accounting standards, we have no idea what these drugs cost to produce, how much is being spent on sales and marketing,general administrative,salary,R&D etc.
Good news is that Daniel T Zagorin Trust bought 500k worth of shares in late March at 0.068. Bad news is the A/S was raised to 1.4B shares (let's pray for no dilution).
Did private companies bring any debt into the shell along with it?
I'm all for an SEC complaint. Time to put the fire under management's feet. I think this stock should go grey until they come up to date with their filings.
Q1 and Q2 come out the same day? That would be amazing.
FLXP just underwent a reverse split. 10,000 shares to one. Their stock was worth 0.0006 pre-split, 6$ post split. With 20M shares they had a $120M market cap. When they're first financials showed just 22k, the s/p dropped to $1. To be honest it's amazing they aren't worth a penny at this point.
If sales are acurate what are the variBles that can duck us over? New debt? Dilution? High costs? Which is mozt likely with a pharmaceutical company?
Where did it close today?
I'm seeing different numbers on different sites
Am I the only one who couldn't trade their shares today? I'm seeing less than 2000 volume today. Today's prices mean nothing just like they've meant nothing the past few weeks...
My bad..
Why are they showing after hours prices from two weeks ago? Is that the last time an after hours trade took place, or is it just another thing to not understand about after hours trading? lol
Marketwatch is showing $PAWS trading at 7 cents p/s after hours :)
http://www.marketwatch.com/investing/stock/paws
I can see this PR pushing this stock in a couple of directions.
Ideal: Matched with a favorable Q1 (pre-market Monday). Shows that Dan was a good spokesman for the co. in its infancy, but now a shift to a more pragmatic long term strategy (i.e. Dan as a good promoter, new CEO as a good manager)
Least ideal: Dan booted because of issues with the Q1 (i.e. his previour PRs come no where close to matching PAWS's actual revenues). Essentially damage control.
average down? haha
10Q after hours today? Makes sense, I've worked at a securities law firm and there is usually a mad scramble to finish before EOD Friday to avoid having to come in over the weekend.
Does anybody know if this 10Q will be audited?
If the revenues they have been releasing are accurate I can't believe the share price is so low.
$PAWS competition?
Can anybody share the ticker symbols for this company's main competition? I'd like to do some comparative analysis.
Monkey was saying that every other player in the industry is holding strong at .25 p/s but did not mention how we fare on a market cap to market cap basis.
Glad to be on the band wagon.
I just entered. 68k shares at 0.058. RSI is low and this is ready for a second bounce. Delayed financials were positive for me because it shot the price down. By the looks of February PR twe could be looking at a 4 bagger here. Thanks Monkey for the tip, always appreciate youe twitter posts.
In for 400 shares at $6
I'm optimistic about the s/p prior to financials being released
If they cancel a good chunk of the A/S I can see this stock shooting back up to 20s 30s
Yep, that A/S scares me though...
My post had nothing to do with P/E ratio. We don't even know what the earnings are...
People who bought in at 0.0006 will need $6 a share to break even. With 20M O/S that means the market cap has to be at $120M.
All depends on what the financials show...