Cono Italiano, Inc. (OTC:CNOZ) news and stock advertising has kept the price inflated since last Friday, but with no more appreciation in sight the profit taking and the possible shares dump mean a potential collapse.
Cono Italiano said in its Thursday’s after market close press release that the company will debut with one of its products, the “Pizza Cono”, at TD Bank Baseball Stadium in New Jersey. The company inked an agreement with Centerplate Inc. to sell the pizzas at concession stands.
One day after the news came out, stock promoters rolled out their advertisements to get the price pumped up. A more than 20% increase in the price of the usually illiquid stock of CNOZ was created through $17 thousand promotional campaigns, carried out by at least 5 different websites over their operated mailing lists. Another promoter disclosed to have received for the same service a 2.5 million share compensation from a third party CNOZ shareholder. [BANNER]
The news announced by the company could not have such a massive effect on the share price without the promotions. The possible revenues from distributing the product at just one location can’t be a game changing matter, even if the business had no recorded sales in earlier periods.
SEC filings for Cono Italiano show a harsh financial situation:
• Miniscule income and constant losses since inception
• CNOZ operates virtually without cash and holds a heavily leveraged balance sheet
• Funds are constantly raised through equity offerings or borrowings
The practice of selling stocks or convertible instruments is one of the key reasons for stockholder dilution and third party paid promotions in the penny stock industry.
