A mere Letter of Intent brought about really spectacular trading with the stock of O2 Secure Wireless Inc (PINK:OTOW) yesterday.By the time the trading session came to an end, more than 33 million shares of OTOW stock had changed hands. The price movement was rigorous as well. However, as soon as OTOW stock hit a daily high of $0.0158 per share, longholders immediately started exerting heavy selling pressure, ultimately pushing the price down to the closing level of $0.012. Thus, OTOW stock still registered a minor increase of 0.84% in value as compared to the previous day.
While promoters appear to have given OTOW a miss, the company has been fairly prolific news-wise throughout the week. It has been issuing updates every single day since Monday. So far, the informational invasion has had minimal impact on the price.
The LOI announced yesterday hints at a prospective financing for the amount of $100 million, aimed at constructing a complete wireless network over the Dominican Republic. The news may sound promising to traders. There is only one problem – nothing has been finalized yet. [BANNER]
O2 Secure Wireless, Inc. occupies the communication services industry. At present, it specializes in the development of wireless network products. A quick glance at its latest financial report, however, casts a shadow over its ability to deal successfully with such ambitious problems. As of Sep. 30, 2010, OTOW’s balance sheet shows:
- a negative working capital of $790 thousand;
- an annual net loss in excess of $180 thousand.
Nevertheless, the company did manage to generate more than $94K from net sales. Therefore, with a final product/service at hand, OTOW has the potential to expand, provided that its managers raise enough capital. How? The LOI mentioned above seems a good opportunity.
