Telkonet Inc (fka TKO)

[MLK]

This stock is truly tanking even faster than I thought possible. I feel really bad for any newbies that bought into the scam after the recent run up.

Look, here is the problem with TKO in a nutshell:

At the beginning of this year, RP promised that TKO, with MSHI in the fold, would take in $25M in revenue. Most people, including myself, believed this was possible after the GE announcement. But, as you will see below, there is no way TKO even comes close to making $25M this year.

After the $25M promise, things changed. First, they went out and bought Ethostream and SSI through dilution of TKO shares. Then, they spun off MSHI to reportedly cut expenses.

Now, in the conference call that most everyone on I-Hub, save MLK, was so excited about, RP told us that Etho and SSI would contribute about $12M per year (I think that number is accurate, if memory serves me right) to the bottom line. So, you would think that instead of TKO generating $25M in revenue, it would now even look better with $37M in revenue. Nope, that was the first punch to the gut...RP promised in the CC that TKO would still only be able to generate $25M in revenue, despite the contributions from Etho and SSI. So, in effect RP diluted TKO shares only to make the same promise that he had made several months earlier with TKO's undiluted shares. That was the first downgrade in projections that was ignored by everyone...except MLK and the market.

Then, in this last quarterly report, TKO announces that they generated $3.6 in revenue. Only, when you consider all the above information, you have to take out $500K of it, because it is really MSHI generated revenue. Leaving TKO with only $3.1M in revenue. Then, if you think that Etho and SSI will bring in $12M this year and divide it by four to arrive at a quarterly number, you quickly find that Etho and SSI probably generated $3M this last quarter. So, when all is said and done, TKO generated $100K this last quarter. $100 flipping thousand dollars is all we got for continual dilution and lost opportunities. What happened to all those BIG contracts? What happened to GE, the schools, the navy, homeland security, etc, etc, etc. The fact is that RP and TKO made agreements with all those groups and couldn't generate more than $100,000 last quarter. In effect, those agreements are worth about as much as the paper they are printed on.

Why is TKO stock going straight down? It's not really all that hard to figure out when considering all the above.

As I write this, TKO is down to $1.43 when most of the cheerleaders thought we would be well above $2.00 after the quarterly and COO announcements. MLK said nope, back down to the lowest levels we have seen. The market, which never lies, apparently agrees with MLK. I'm just sorry I couldn't help more of you sooner.