Creative Edge Nutrition Inc. (OTCMKTS:FITX) Red Six Times In A Row
Friday saw Creative Edge Nutrition Inc. (OTCMKTS:FITX) fall even further down the charts, once its most prominent partner was suspended by the SEC. The company’s attempt to distance itself from the controversy in question only furthered FITX‘s fall, taking it all the way to $0.061 by the end of the week.
The last few market sessions had been a veritable disaster for FITX, costing it more than 25% of its market value. For a time this latest descent had been steady, if not exactly slow. That changed during Thursday’s session, when the ticker plunged further downw on the news that Growlife Inc. (OTCBB:PHOT) had been suspended by the SEC. The reason given for the suspension was “potentially manipulative transactions in GrowLife’s common stock”. The suspension alone was serious enough to destroy trust in the company, but media attention pushed events one step further, plunging the whole marijuana stock market into chaos, that caused a sector-wide crash.
The ensuing panicked withdrawal dealt a massive blow to many companies, but while others in the branch have already started recovering, FITX is still going down, hard. This is mostly due to the close relationship between FITX and PHOT.
To elaborate – FITX was supposed to benefit immensely from PHOT‘s GIFT program. It was never particularly clear how exactly PHOT was going to finance the operation to begin with, but PHOT‘s involvement was one of the few things that kept FITX afloat. Despite the 8-k filed by PHOT detailing the deal with FITX being severely obfuscated in the first place, news on the development of the strategic agreement between the two companies always caused a frenzy of buying.
With PHOT‘s credibility diminished as it was on Thursday, FITX receiving any financing whatsoever appeared out of the question. This must have become immediately obvious for FITX, because it backed away from PHOT promptly. The announcement that FITX had decided rescind the agreement between CEN Biotech, RXNB, GrowLife and OGI didn’t come as much of a surprise at that point.
In that same PR, FITX declared that it had found other means of funding – selling a 25% equity stake in its biggest project to an undisclosed third party in return for cash. Although the sum given for the alleged funding received is impressive, no filing has yet been made to document it. Whether or not it this is just another publicity stunt, aimed at halting the ticker’s rapid descent, remains to be seen.
Still, with things being as uneasy as they currently are on the marijuana front, a bold declaration is obviously not enough to push FITX back up the charts.