Raystream Inc.(fka RAYS)

[stockpopper]

I have followed and invested in legitimate penny stocks for years and while it is rare for an OTC stock to become a listed stock, it happens more often than one might think. Every year a handful of OTC graduate to a higher exchange.

http://otcbb.com/dynamic/tradingdata/daily/graduations.htm

So while most penny stocks do not become multi-billion dollar conglomerates, many of them do grew into successful businesses. In recent years however, because of unbridled massive short selling of all OTC listed securities it has become very expensive and dilutive to raise capital for small companies that wish to grow.

Fraud occurs on the NYSE on down so just because a stock trades on the OTC does not constitute a good reason to short all penny stocks that are trying to grow (and succeed) into oblivion – shorting penny stocks into the dirt destroys a very large segment of job growth in America.

To clarify, when I say penny stocks I am not referring to the price – forget the PPS, it is irrelevant – I mean market caps of a few $100M or less. Looking back into history one see’s that many of the greatest companies of today had penny stock market caps in the early days.

Long before they became the respected leaders of today and Dow components, during their formative years they had zero earnings and minimal revenues but they were able to sell stock at a decent valuation in order to grow.

With the massive naked short selling of all unprofitable penny stock market caps of today (regardless of the exchange) I would say many companies such as Intel, HD and MSFT would never have made it.

So today’s market has become especially brutal, naked short selling hedge funds and market makers target these companies for destruction right out of the gate, never giving them a chance to grow and see their potential through.

This is a big part of what I see happening to RAYS, I’ll be the first to admit I misread that buyins.net report, obviously the short position is not 34.75M, however its certainly much higher than the few 100K someone mentioned. I would guess it’s probably somewhere in the middle but clearly there has been massive short selling going on here, and all the negative posters here predicting doom and gloom are a component of that.

This is really too bad, because RAYS really has made an important breakthrough in video compression and the company deserves every chance to grow and reach their full potential.

I for one believe in a great future for RAYS, regardless of the short position here I believe RAYS will prevail in the end and become a very successful and profitable company in the long term.

GO RAYS!