Lifevantage Corporation (OTC:LFVN) is going down. Slowly but surely. Oddly enough, the downtrend started after the company’s third 10-Q report saw the light of day in mid-November.
Oddly, because, judging from the financial figures present in the 10-Q, the current financial condition of LFVN is better than most penny stocks. Yet, LFVN stock has depreciated quite a lot, i.e from $1.56 on Nov. 14 to $1.35 on the pre-Christmas session. A total of 213 thousand shares changed hands last Friday, which is very close to the daily average trading volume of 215 thousand.
As if attempting to reverse the trend, LFVN published a comprehensive corporate update on Dec. 19. Apart from a stock repurchase plan, the company also revealed that a warrant amendment was pending approval which would remove price-based anti-dilution provisions. Last but not least, LFVN’s managers outlined the company’s business development in 2012. However, besides adding a single cent to its value, LFVN stock failed to regain what it had already lost.
As far as the aforementioned 10-Q form is concerned, it showed that, as of Sept. 30, 2011, LFVN had:
- cash reserves of $9.4M;
- $14.5M in current assets vs. $14.01M in current liabilities;
- $19.2M in derivative liabilities;
- net sales of $20M vs $6.4M for Q3 of 2010;
- net income of $3.7M as opposed to $0.7M in Q3 of 2010.
Altogether, LFVN seems to be going into the right direction. Its net sales have tripled on an annual basis, while its net income has soared even more. However, investors should not forget the $19.2M of derivative liabilities which could pose challenges before the company’s management in due course.
