Yesterday, Zamage Digital Art Imaging, Inc. (PINK:ZMGD) flew up at full speed. Just for the day, the stock added 283.33% to
its price and its traded volume exceeded 28 million shares.
The shocking gain can be easily explained with a portion of good news, accompanied by promotions. The news was released yesterday, when Zamage announced one of its subsidiaries, Paraform Design, has been hired by Chick-Fil-A to handle signage and sign maintenance at several franchise locations. The announcement states that ZMGD anticipates the franchise contract to be successful and to offer them other great opportunities.
The positive statement immediately influenced the company’s stock price, though it was not the only reason for the gain. In order to pump up the stock price, ZMGD was promoted yesterday for a total compensation of $59.000.
Apparently, the campaign worked out properly, however, it is interesting how long the climb will continue. In any case, promotions look the usual pump up strategy for Zamage, considering the fact that the stock has been promoted quite often. [BANNER]
Zamage Digital Art Imaging, Inc. has two subsidiaries: Paraform Design and Everdow Software (Beijing) Inc. The company is not making any material information publicly available, though its annual report for the year 2010 can be found online. However, the company’s financial condition turns out to be disastrous.
Zamage has neither revenues, nor assets in its balance, while at the same time the company has liabilities and expenses to cover. Also, its net profit and cash flows are negative values, which is really bothering for investors.
Having in mind these financials, it is no wonder ZMGD cannot meet its obligations and operates under a going concern. Presently, the franchise contract is a new hope for the company, however, there is plenty of time until it brings any profit.
