Tranzbyte Corp. (OTCMKTS:ERBB, ERBB message board) lost 15.05% of its market value yesterday, in an intense trading session which left it gasping for air. The ticker opened distressingly low and despite its struggle to climb out of the red zone, it ended up closing as low as $0.0429.
The fact that ERBB closed in the red three times in a row, even after the massive media exposure it got during the last couple of days, is perplexing, and more than a little disturbing. So far, the usual reaction of a marijuana-related ticker to such media attention in the present volatile market has almost always been a jump up, or at least a steadying of pace. Surprisingly enough, ERBB has done just the opposite during the last three days – the company is currently gathering downward momentum, fast. Why is that?
The company’s present descent may well be the result of investors starting to have serious doubts about ERBB stock. Experience shows that hype and hope can push a marijuana ticker unreasonably high, but unfounded faith in unconvincing claims of future success doesn’t last forever. And once some due diligence is done, financials such as these may come into play, possibly destroying whatever faith the investors have in a stock:
- cash – $2 thousand
- current assets – $38 thousand
- current liabilities – $3.6 million
- total liabilities – $5.8 million
- revenues – $86 thousand
- net loss – $323 thousand
Presently, ERBB is a prime example of how desperate publicity stunts can end up turning no results at all. The news that ERBB has entered into a distribution agreement with iTalk, Inc. (OTCMKTS:TALK) appeared to be just that – a publicity stunt. By all accounts it should have been enough to break the company’s downward slide. After all it is good news, that ERBB is taking steps to improve on the safety of its product, right?
Wrong. ERBB could have hardly picked a more ill-suited associate. TALK is a company notorious among seasoned traders, currently well known for being on the receiving end of more than 120 paid pump emails in the second half of 2013 alone.
But even if this huge red flag is ignored, TALK financials can hardly convince anyone of the company’s efficacy. How can it aide ERBB if it only has $26 thousand in cash? Meanwhile TALK’s net loss approximates $1.9 million for the the six months ended Feb 2014.
If this is the best support ERBB can muster, it’s no wonder that the ticker is currently falling as hard as it is. In all likelihood it will continue on its way down, unless this stagnant and disappointing state of developments the company is currently stuck in, changes for the better dramatically.
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