Calissio Resources Group Inc (OTCMKTS:CRGP) Knocked Down

Here’s a task for you: find an OTC stock that’s traded in the sub-penny levels, has millions of dollars in the bank, a comparatively small amount of debt, impressive revenues, and seven figures under the net income section. In fact, you don’t need to look for it. It’s right here and it’s called Calissio Resources Group Inc (OTCMKTS:CRGP).

In light of the characteristics we listed above you’re probably contemplating jumping in. Before you do it, however, you might want to consider some other things. CRGP hasn’t always been a sub-penny stock. In fact, nine months ago, when it emerged out of a 1 for 200 reverse split, it was sitting at just under $3 and it has since then single-handedly incinerated 99.9% of its value.

Rewind the tape further back and you’ll see that the stock was once traded under the AMMG symbol and it was among Mike Statler’s first picks which almost automatically means that it’s quite used to leaving investors disappointed. This was proven over the last few sessions as well.

CRGP surged up at the end of last week when the company proudly announced that it’s about to sell one of its mines for a grand total of $14.6 million. Investors were quite happy with the news and in a matter of just two sessions, they pushed the ticker from $0.0022 all the way to $0.006. Unfortunately, it then stopped and before anyone knew what was going on, CRGP was hurtling towards the ground at a rapid rate. During yesterday’s session alone, it wiped out a mind-boggling 56% of its value and, after logging a brand new 52-week low of $0.0016, it stopped at $0.0023 per share. About five minutes after the opening bell, it’s another 8% down which goes to show that while a bounce is not out of the question, treading carefully is still essential.

CRGP could serve as a really good example of how a solid balance sheet and respectable revenues might not be enough to keep the stock afloat, especially in Pennyland. But if the problems don’t lie with the operations, then what is the reason behind CRGP‘s devastating performance?

Unfortunately, a definitive answer to this is not easy to find, but people do seem to have a hypothesis. It involves dilution and it might not be unreasonable.

Thanks to the wonders of OTC’s alternative reporting standards, we don’t know how much of the company’s debt is convertible into shares and we can only guess what the conversion features (if any) are. What we do know for sure, however, is that during the first three months of this year, CRGP issued 6 million shares at $0.001 per share as a conversion of debt. We also know that last week, without looking for approval or even announcing it publicly, the management team raised the number of authorized shares from 300 million to 975 million.