Ideanomics Inc (IDEX)

[BobDoleYahoo]

I would stay very far from this stock right now from it's almost 200% appreciation from under $2. I finally had some time to research this company. It went through so many name changes it's not even funny. That's a huge red flag. Their May, 2017 10-Q shows them as WEBCAST NETWORK. In fact, when you search them on the SEC's website, the first thing that the SEC website displays is the list of all their former name changes.

Their massive revenue growth this year was from oil trading, and not from their core business. That's a bad thing. Yahoo had a huge investment in Alibaba and did very well, yet they still went down the drain. However, SSC's Cost of Revenue grew about just as much as their revenue, basically netting zero, and has actually caused a MUCH greater net loss. In fact, their Selling, general and administrative expense shot up big time, mainly from "employee compensation", resulting in a HIGHER net loss.

Below I compare the two prior 10-Q quarterly report revenue numbers. This confirms the company did much better last year. This year, they appear to be inflating their revenue numbers, but costs are so much that after they paid their employees more, their net loss is huge compared to last year's.
https://photos.app.goo.gl/snpUerKqoVNxP6Wz9

Their new PR shows billions of dollars, but they will only receive a small fraction of this as it doesn't equate directly to revenue. They're simply going to be responsible for funding the project. Their CFO states they anticipate they'll receive $480 million from the $24 billion project, which equates to 2%. If we divide by 4 quarters x 3 years, that's $40 million on average per quarter they anticipate to receive. This doesn't take into account Cost of Revenue and Operating Expenses, which will reduce this figure most likely significantly.

Their 10-Q states:

1. "Revenue for the three months ended March 31, 2018 was $185.9 million as compared to $33.2 million for the same period in 2017, an increase of approximately $152.8 million, or 461%. The increase was mainly due to our expanding business of crude oil trading initiated in October 2017."


2. "Selling, general and administrative expense for the three months ended June 30, 2018 was $8.8 million as compared to $3.0 million for the same period in 2017, an increase of approximately $5.8 million or 194%.

The majority of the increase was due to 1) an increase in headcounts and relevant traveling expense in the amount of $1.2 million; 2) an increase of approximately $3.4 million in share based compensation that were paid to our employees;"

SEC's website shows their name changes below. This is generally a bad thing because it tells you their business model isn't working and they're continually having to change. We see the same with HMNY when it changed it's name repeatedly in the past. It's also bad when they change their ticker symbols (thus ensuring new shareholders don't know about their past).

Seven Stars Cloud Group, Inc. CIK#: 0000837852 (see all company filings)
SIC: 4841 - CABLE & OTHER PAY TELEVISION SERVICES
State location: NY | State of Inc.: NV | Fiscal Year End: 1231
formerly: ALPHA NUTRACEUTICALS INC (filings through 2006-09-21)
formerly: ALPHA NUTRA INC (filings through 2007-05-09)
formerly: CHINA BROADBAND INC (filings through 2011-02-07)
formerly: GALLERY RODEO INTERNATIONAL (filings through 1997-05-14)
formerly: SIERRA ROCKIES CORP (filings through 1998-06-03)
formerly: WECAST NETWORK, INC. (filings through 2017-07-07)
formerly: YOU ON DEMAND HOLDINGS, INC. (filings through 2016-10-18)
(Assistant Director Office: 11)
Get insider transactions for this issuer.

Even Connecticut Republican Senator Pro Tempore Len Fasano questioned this company:

http://www.journalinquirer.com/politics_and_government/cloud-deal-questioned/article_e4b19b50-86b7-11e8-bab0-f3a7928d3e25.html

We see from the charts that a lot of shareholders got trapped during the Bitcoin hypes less than a year ago. This means as the share price goes up to the high $5s, there will be a lot of bagholders literally unloading on buyers. This is what's called resistance. The question is: who's going to be the next bagholder, and for how long must they wait to unload on the next round of buyers? If you go back further in the chart, you will see the same behavior of a huge pop followed by the stock ending much lower than it started. In fact, the charts show a reverse split was effected in the past.

https://photos.app.goo.gl/hsf4SqENx2yYATBY7

Finally, their S-1A released on Friday (amending the one from April) is an intent for large insider shareholders to sell their shares. It's not the same as an S-3 or private offering, but that's still another reg flag when insiders want to sell that many shares.