Capstone Companies Inc (CAPC)

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you don't know how to read live action.

LMAO. The stock regularly trades an insignificant dollar amount daily. You're better off reading what your dog dumped on the neighbor's yard.

CAPC is returning to a fundamental valuation, after 2021's MOMO-MEMEr pump fest. 100x from 0.03 to 3.00 on nothing but hot air, wash trading, and painting the close?

Yeah, that needs to unwind. And it is unwinding. From 3 bucks to 20 cents.

Russell 2000 stocks have an average P/S of 1.41.

49,643,031 shares outstanding * 0.20 / 686,000 = 14.47 P/S ratio.

Yeah, the price needs to come down another 90% to have an average P/S ratio.

But, but, but, the Mirror! They'll sell millions of them!

No they won't. It's a flop. A failure. A blackhole 4+ years in the making. May 16th you'll get the bad news. This was all predicted, if you just would have listened.

Actually, the 1Q2022 financial report isn't what you need to dread. It's the re-capitalization of CAPC that will really hurt your wallet (if you're still holding on to shares at this point).

I figure they need about $1 million in new money to keep the lights on through 12/31/2022.

In my opinion, they have nothing left to sell to PIPE investors, except the Preferred B-1. Those have a nice $1/share liquidation preference. Isn't that what you'd want, as an investor in CAPC, given their current struggles? You'll hear more about their financial situation on May16th, less than 3 weeks away.

Preferred B-1 have a conversion ratio of 66.66 to 1 for common shares. 1 million Preferred B-1 would convert to 66.66 million new common shares. Yeah, they'd have to raise the A/S to cover that at some point.

Maybe no investor will bite on the B-1 shares. Liquidation preference doesn't mean you get your money back, just that you're early in the line to get your money back. Can't get money from a broken mirror.

But, then what? More loans from Stewart&Co.? Maybe. Maybe Stewart has a hidden gold mine down there in Florida.