> What it is. > What it means. > What it looks like.
* They are "Big Percentage Movers", and they can be "Life changing", for the trader who has BIG money in them at their lows.
* They can produce "10-and-20 Fold moves".
* Price "Pull-Down" where the price falls HUGE over a relatively short period of time.
* All "you" need to remember, is that with ALL "pull-downs", the "accumulation" starts. This is just the first step!
* "Price Pull-Downs" are OTC game stock. They hover higher for months and months, with NO retail interest or volume.
* The insiders "pull the price down", for the funding of their operations, by increasing the "shares outstanding", and the "authorized shares",
and when the price of the stock, reaches the price level, where the "VC"s want to "Buy", the stock finally bottoms, and you then see the accumulation.
* Most every stock "pennylanders" like these types of stocks. There is another term for trading these "OTC sub" & "Micro stocks". "Bottom feeder" stocks.
* The accumulation is "Bottom Feeders" moving in.
"Venture Capitalists"
* They Load at both, the 0.001 / 0.002 Sub-penny, and 0.0001 / 0.0002 Trips Levels.
* Their Plan: To Sell at: High Penny Levels ! High 0.00 Levels ! High 0.000 Levels !
Educational Post - Dilution
Authorized Shares, has no bearing on the price.
The "Shares Authorized", is not used in any fundamental of financial calculation, to determine company value.
OTC companies only have two things, "stock for sale" and "stories of progress".
Dilution: when the company moves shares from the A/S (authorized shares) to the O/S (outstanding shares) or tradeable inventory, for cash investments in the company.
This means there are more shares at the same market price and reduces the size of the EPS.
It doesn't reduce the price or value of the stock. But many pennylanders think it does.
Dilution doesn't change price, it changes EPS. Creating loss in company value, not stock value.
Hardly 1-in-1000 OTC companies have an EPS to effect. So, dilution can't effect their company value in the first place. What's the value of no earnings, thus no EPS.
On the OTC, "dilution" is the best news one can hear !
Not only does it give the company a chance at growth, it doesn't effect their EPS value one bit.
They have no EPS to effect. Plus, every time VCs get there hands on large amounts of shares, they buy a run, and we can trade for profits !
So, "dilution" is a win for the company, a win for the Venture capital firm, and a win for the educated pennyland trader, on the OTC.
Stocks of many start-up companies, bottom at the "Sub-penny" price level, before they begin their meteoric rise.
"Venture Capitalists" like to buy the shares of these companies at these low levels.
At the End of September, * the company had a working capital deficiency of $2.704 million, * and an accumulated deficit of $6.284 million.
HJOE reported a net loss of approximately $592,000 for the period, and relied on debt financing and private placements of its common stock to fund operations.
Due to a lack of liquidity --another word for money-- it had defaulted on some of its debt agreements and a licensing agreement struck with Warner Brothers for use of promotional materials having to do with the movie The Hangover.
The sales of convertible notes are particularly troubling.
HJOE is in hock to nearly every major toxic funder out there, and to some minor ones as well.
Though most of the individual loans are relatively small, as of early 2015, more than $700,000 in convertible notes was outstanding, and additional financing was needed.
Some, but not nearly all, of that debt has been converted, but more has been incurred.
On March 20, 2015, a new lender, Joshua Sason's Magna Asset Services, Ltd., entered the picture.
In his Schedule 13G, Sason indicated that he potentially controlled 9.99% of the company's common stock, and reported that the current shares outstanding were 1,747,702,984
The outstanding had grown by a little more than 1.4 billion shares between the beginning of December and the end of March.
That is dilution on a staggering scale.
Note that Magna, as a new lender, hasn't converted his note yet.
His position "consists of Common Stock that the reporting person has the right to acquire by way of conversion of promissory note(s).
" Typically, note holders don't convert until their stock can be issued free trading."
March 5, 2015 - 12:19:00 GMT Hangover Joe's Holding Corporation Git-R-Done-Energy (HJOE) Announces Debt Settlements Settles Debit Moves Company Forward
On February 23, 2015 HJOE followed through by amending its articles of incorporation in Colorado to reflect the change.
The gigantic increase in the authorized was obviously necessary to accommodate conversions.
The raise in authorized capital came just in the nick of time.
On Monday May 11, 2015, * the company's stock opened at $0.0004 and closed at $0.001; * on Thursday it hit a heady intraday high of $0.0062 on 532 million shares
In March, Matt Veal released two letters to his shareholders, explaining some of the company's problems and promising brighter days ahead.
In the first, published at Facebook on 9 March, he succumbed to a temptation that bedevils many penny CEOs: he decided to take Shorty and "bashers" to task.
He sternly--and inappropriately--warned that "bashers who try to harm this company with lies and disinformation we will have our attorneys monitoring for this and will be swift to take action in the future.
Also our social media is for our customers and if someone bashes on our social media you will be banned.
They have an agenda and they hate that this company has continued to survive and move forward with all the efforts they made to make this not possible."
In the second communication, from 18 March, Veal returned to the same theme.
He began by acknowledging that shorting is not illegal, adding, "And Hangover Joes [sic] has seen [a] considerable amount of shorting recently!"
While it's true that short interest increased between the end of February and mid-April, so did the stock's average daily volume.
More importantly-- and something Veal neglected to explain-- the shares outstanding had by that time ballooned to 1.75 billion.
The 16 million share short interest reported on 31 March is insignificant in comparison.