DNA Brands Inc (DNAX)

[Ed the Trader]

"2) The A/S is 6 billion, so you better assume that the intent is to dilute to that level. You especially better assume that intent if the transfer agent remains gagged. If DNA management authorizes the TA to report share structure on demand then you can cut DNA some slack regarding dilution because you will be able to track it as often as you feel appropriate to make your decisions on buying and selling. Unless that occurs, you have to assume that DNA will dilute to the maximum allowed by the A/S at any time, and that they will attempt to hide that action" --- Ed

"Cup half full hopes they can get profitable and retire many of those shares providing continuation of business goes forward." --- Exitech

Sure... that is completely the same hope that everyone would have... for the long term. The question is, "Are you willing to hold shares for months (or longer) while they run through another 5 billion shares of dilution to fund business operations while they attempt to become profitable?"

My answer was, "No." So, I took a $4,500 loss selling my shares at about $0.0011. By doing that, I avoided the further 50% drop to $0.0005/6. Because I think that the PPS will ultimately drop to about $0.0002/3 (if one billion shares have a value of $0.0011, then 6 billion shares should have a value of about $0.0002), even though taking that kind of loss sucks, I think I made the right choice.

I hope to see an opportunity to acquire new shares of DNAX later after the dilution has finished dropping the PPS. I still strongly believe the company has excellent products that can become very competitive with their competition, but that will require some excellent management of the company.

If I saw DNA management start to get open and honest with shareholders by ungagging their TA, and a release of some details of a business plan that explained how DNA management intends to address boosting sales (ex: expanded advertising), THEN a person might be inclined to throw some spare bucks their way to ride things out for the long haul, including absorption of some dilution. Unless that happens, there is no point to buying or holding this stock until the PPS bottoms. Until that happens, this stock is only good for possible one tick flips, and with the constant downward pressure on the PPS due to dilution, even that is risky.