Echo Automotive, Inc. (OTCMKTS:ECAU) Jumps Seemingly Out of Nowhere
The stock of Echo Automotive, Inc. (OTCMKTS:ECAU) was being traded quietly for quite a while, after the heat of February and March cooled off. Recently, however, it started to climb both in price and volume and it seems that the main reason for that was a press release from October 29 which sparked investor interest.
The press release was very optimistic, indeed, but we reckon that the discussion on investor forums, where a lot of people touted the stock also played its part in maintaining the upward run.
ECAU announced that the company is initiating a North American pre-sales for their EchoDriveTM fuel efficiency system and an incentive program that promotes loyalty between the company and the customers that order first and this was enough to heat things up a bit.
This in term led the company stock to a 71% gain over 3 sessions and an increase in volume. Yesterday, as ECAU added another 13% to its value, it registered the highest amount of traded shares in more than 6 months.
The stock gapped up and opened at $0.50 per share and there was little movement. The ticker closed the session at its opening price with an estimated 578 thousand shares that switched hands, generating $302 thousand in dollar volume.
What concerns us the most is the fact that the actual sales of their product will commence in mid-2014. While some of you might say that this is not such a big deal, it could mean a correction in the stock’s direction in the coming sessions.
Another thing that troubles us is that the EchoDriveTM system is only available for Ford E-Series vehicles. While ECAU is targeting businesses with big fleets that want to save up on gas, this limits their product’s market quite a lot.
In all cases be sure to do a lot of due diligence and weigh out the risks for yourself, because things can turn around pretty soon if we don’t see some more optimistic news.
Another company that had a decent gain yesterday was Globalstar, Inc. (OTCMKTS:GSAT), who finally made a bigger percentile movement with a 17% gain on a massive 15 million shares that helped generate $25.7 million in dollar volume. TheDirectory.com, Inc. (OTCMKTS:SEEK), was probably the biggest winner with a 52% gain in price and a high volume.