Take your profits while you can is my best advise. I predict they are short lived. Can't put the cat back in the bag. Everyone has now figured out exactly how they are generating their purported growth. Had they not come up with the creative way of recognizing all of those non monetary license exchanges as revenues, where do you think the stock would be trading right now? I can't imagine reporting a 50% plus drop in monetary revenues would have supported the current 100X multiple of cash sales. 97% of all last quarters revenues involved exchanging a license with a customer for no cash. All the partnerships, sales groups and press releases about how all agencies need what they offer, yet cash sales dropped over 50% at just $87k in Q2 and some, if not all of it, may have come from La Frontera where the CEO's father is Chief Development Officer. Same company who they previously issued no less than 3 press releases about.
I won't be surprised if and when they are again raising more money and diluting again. Just look at what has occurred to share count in the last year, almost 100M shares fully diluted. If you consider they only generated $87k in cash revenues last quarter and how they lowered the strike price on those 10M warrants to get them exercised, without that they would have again been selling more shares to fund operations. With the warrants already having been exercised last Q, it will be interesting to see what happens in terms of a need for additional financing. Rarely have I personally seen a small company run through cash like this one and only have just $87k in cash revenues in the most recent quarter to show for it.
