At this stage in the companies life. I understand why they are raising funds through selling shares.
Splitting stocks makes me very nervous. Look at Converted organics and its reverse splits. In the past 5 years if you held through the reverse splits they did you would have turned over 18 million dollars into .35 cents.
They turned 54 million dollars into 1 dollar through its financing and horrible leadership over a 5 year period. That company did deals with business's that family members owned.
(phytosphere which was purchased from nick brusatore and Mr Gildeas brother!!! Talk about lack of ethics and you'll find it with that company) for massive amounts of shares. Only to sell those business's off at a loss to MJNA.
I am extremely bullish on this company and the sector. But reverse splits right now, while they are selling shares for cash should be a huge red flag in the short term.
I can't say what will happen, but for an ex. if they take a 5/1 split and then dilute out 4/5 the shares again to gain cash. That directly effects the % control in the company one has.
If they make the millions then dilute out and invest into the business which in turn creates more revenue than the cost to shareholders (In terms of %) than it would be wildly bullish.
One thing that is bullish but not to hang your hat on is the fact that insiders own 10% of the company. Unless they lose control of the company that's a bit of skin in the game that may help keep them on the straight and narrow.
Please just be careful with RS and financing in these stocks. If done well this could be a big boost to the companies longterm ability to survive. Also if done wrong it could be the start of the end.
We'll see in the upcoming weeks more clarity on actual business and numbers. Hopefully that coincides with the paid promotion going on now. If company developments, plus a paid promoter can't make this company break .06 that tells you some serious amount of shares is most likely being sold to fund the company.
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