Big volume and a huge sell-off. Indeed, this is what happened with the stock of Stratus Media Group Inc. (OTC:SMDI) during the latest trading session.
Hardly had anyone expected such a scenario. Out of nowhere, SMDI went down 33% to a six-month low of $0.40 per share. Moreover, there is a very clear reason behind this big depreciation – a huge volume. Indeed, more than 332 thousand shares of common SMDI stock changed hands, which had not happened since December, 2008. What remains unknown, however, is the motif behind the intense trade.
Anyway, now that SMDI has taken a huge nosedive in terms of value, it is likely to become more volatile and susceptible to various market games. Some traders have already expressed interest in seeing what direction SMDI will take in the forthcoming session.
Stratus Media Group, Inc. intends to change the world of live entertainment. The company hopes to generate its revenue from ticket sales and membership fees. SMDI’s corporate website is still under reconstruction, although it says it should be ready in November.
SMDI has so far been a diligent SEC filer, as well as a transparent information provider. Unfortunately, its financial state does not guarantee that the company will continue as a going concern without external funding. As seen from SMDI’s third 10-Q form for 2011, its balance sheet as of Sep. 30 contains the following numbers among a few:
- $2.2M in cash and equivalents;
- working capital surplus of approx. $190K;
- $250K in net revenues and a quarterly net loss of $4.3 million.
As it seems, it will take a while before SMDI’s current corporate strategy starts to bear fruit. Until then, the company will be in dire need of additional financing, which will in turn be fully dependent upon its supporters’ predisposition to continue investing money in it.
