What would you do if you owned a company whose stock was tanking at a breakneck pace, regardless of anything else? A reverse split is the first option that comes to mind, and this is exactly what Cardio Infrared Techs New (PINK:CDOID) did on May 4, 2011.
Shortly after the reverse 1 for 3000 stock split took place, CDOI stock ended up being artificially elevated up to the $1 mark, only to crash down big time faster than the speed of light. The overall slump is of even greater scale given that third parties tried to give it a boost by embarking on an ambitious promotional program. Estimated at a staggering $1 million, the advertising campaign was aimed at pushing CDOI stock up by making a thorough coverage of the company throughout the whole month of July.
So, what are the consequences as of today? While CDOI shares were traded around the $0.20 level at the beginning of the month, yesterday’s trade saw CDOI stock price shrink down to a minuscule $0.055 per share. Indeed, CDOI experienced an impressive 130% surge some two weeks ago, yet, no similar eruptions have occurred since.
Claiming to be a leading health and wellness technology and marketing company, Cardio Infrared Technologies, Inc. is best known for its BIOFIT stationary infrared bike. The technology, which had been under development for quite a while, aims to combine exercise equipment with medical benefits. As it seems, the company is already enjoying a rapid increase in orders from European countries and intends to conclude its expansion projects well in advance as a consequence thereof.
As of Mar. 31, 2011, CDOI disposed of $828K in current assets, 95% of which in the form of clinical trails. As far as the cash is concerned, it must have expired since the record shows zero. On the other hand, CDOI’s current liabilities only slightly exceed $300 thousand, all of them being either accounts, or notes payable. In addition, the company has reported other assets in excess of $3.7 million, yet, it is not quite clear where they originated from.
CDOI scored a net quarterly revenue of $49,200 and a net loss of some $30 thousand. The latter marks a double improvement over the same quarter of 2010.
In case CDOI manages to give an adequate response to the increasing demand of its Biofit (TM), the company might be in for a breakthrough. However, investors should not forget that pink sheets are generally presumed unpredictable. Not to mention all split manoeuvres they are capable of.
