That, and the fact that financials are bogus.
The 10-Q is a mish-mash of data that flat out conflicts with earlier reports.
1) At the end of 1Q/14, they said the KannaLife investment was worth $400K, then they "sell" it to MJNA for $7.9M of their own stock
2) When they bought Phytosphere from MJNA, they initially collared the stock price (for the sake of expensing) at $4.50 - $6.00, then at the end of 2013, they revalued the deal to the equivalent of $1.21 per share, then in this report, they're suddenly using the price on the day of the contract ($16.60 on June 2) to value the contract. Maybe for this transactin they used "unrestricted" shares given to MJNA more than a year ago.
3) Non-GAAP EPS (not counting the $7.9M of stock) was only $0.004/share
4) They terminated the company responsible for 100% of their operating revenue
5) The 10-Q didn't include a cash flow statement for the quarter, and only included one covering the first six months of the year. The omission makes it impossible for a "newbie" to know that nearly all of the cash was raised in 1Q via the stock offering, unless they read the text of the report.
Disclosure: No position. Haven't been long since March-April, 2013, and my only brokerage account with TDA doesn't allow shorting of OTC stocks.
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