This one goes out to all gullible investors who often walk into classical traps laid by promotional enthusiasts. Today’s case is the latest paid effort to dump shares of EWRL stock.
There is no doubt that the two dozens of promotional emails in support of Green Energy Renewable Solutions, Inc. (PINK:EWRL) have done their best to mislead investors into believing that EWRL is the new big green energy player on the horizon. As you will see below, this is nothing but mere wishful thinking for a few reasons.
To begin with, bear in mind that these seemingly avid EWRL supporters expect to receive up to $650 thousand for spreading the word on the stock. Needless to say, the credibility of their research is nothing short of compromised.
In addition, the company’s supposed market cap of about $24 million raises serious doubts that it might have lost touch with reality. According to its latest financial records, EWRL has total assets of $44K vs. total liabilities of $0.53 million. Combined with a quarterly net loss of $1.22 million, these figures do not exactly account for a favourable capital structure.
Another circumstance that should keep you on high alert is the company’s stock policy. While there were 9.25 million shares issued and outstanding as of Dec. 31, 2011, this number more doubled in just three-months’ time. What is more, EWRL carried out a 1-for-40 reverse split in Sept. 2009, only to be followed by another 1-for-5 one last January. Both efforts proved worthless in the mid term as far as the company’s stock price is concerned.
If you look at how EWRL performed for the last three days of trade, however, you will most probably come across some extraordinary gains. Rest assured, though – EWRL has not reinvented the wheel. Rather, it has merely fallen victim to paid pumping, much to the benefit of the campaign’s initiators themselves and not the regular traders.
As it is, EWRL has just undergone some large-scale artificial pumping which transformed EWRL stock into a cash cow for dumpers, on the one hand, and a black hole for credulous market players, on the other. Whenever such a scenario reruns in the future, be sure to place any hypothetical investments in EWRL on red alert.
