After entering the OTCBB market above the $1 barrier in the middle of June, Sport Endurance, Inc. (OTC:SENZ) stock lost rapidly more than half of that value over the last month in two dramatic plunges, the second of which happened yesterday.The expected promotional disclosures were also made yesterday, suggesting that Sport Endurance must have commenced its trading with some strong outside support. According to the disclosure, six different stock promoting websites promote the stock to investors, three of which received a compensation of $90,000 and one $50,000 for one week of their advertising services. The fifth one got $5,000 also for a week, and the last one worked modestly for free for the appreciation of SENZ stock.
The OTC newcomer SENZ was in addition popularized in the investor community over a number of press releases, from which only a few contained information that appears to be true: it is true that SENZ commenced trading in June, the company has actually a website and the massive dilution through a planned five for one stock split seems actually postponed for now.
Though, all of the marketing attempts related to the company’s business sound more than ridiculous. Yesterday’s announcement about a research report valuing the stock at $1.50 turned out to be a paid service as well. Just like the above mentioned promoters, the equity researcher responsible for that report is not a registered investment adviser, was compensated with $2,000 for making the report, and the information provided is based on “forward looking” statements and publicly available sources.
Unfortunately, Sport Endurance latest quarter report is also publicly available for any interested investors. It makes the company sound even more ridiculous in trying to convince investors that its zero sales for all of the 10 years of existence will all of a sudden grow to over $7.4 million over the next year. The production of the intended products has not began yet and assets of around $27,000, consisting of $3,000 in cash and some computer equipment, furniture and fixture, should make the sales grow and generate a profit, instead of the over $161,000 accumulated net loss.
The second SENZ drop from yesterday took away another 14.01% of the stock’s value and the closing price of $0.335 was the lowest for the short trading history of the stock.
