Global Equity International Inc (OTCBB:GEQU) MStarts To Hesitate
In less than a month Global Equity International Inc (OTCBB:GEQU) have announced a consulting agreement with Advanced Imaging Projects , a pharmaceutical company based in South Florida, a long-term partnership agreement with Yenom (Pvt.) Ltd, and an agreement with the Italian automotive parts manufacturer International FIM SRL. The company also kept its promise and on September 24 they were upgraded from the OTC Pinks to the OTCQB Marketplace.
Quite an impressive list of achievements but is this enough to justify the stock’s meteoric rise up the chart? From a price of just above $0.0012 at the end of June currently GEQU are sitting 3400% higher at $0.042.The last time the company traded at such price ranges was in December 2014. Commanding a market cap of over $32 million at the moment might prove to be a bit too much for the company to sustain.
It is true that in the latest quarterly the company reported a positive bottom line but as a whole GEQU is still in a troubled financial state with:
• $734 cash
• $52,490 current assets
• $3,899,798 current liabilities
• $1,140,500 revenue
• $372,802 net income
Investors should note that a substantial amount of the revenues, or $865,500 to be precise, were received in the form of 3,460,000 common shares valued at $0.25 and 500,000 preferred shares valued at $0.001 per share from the private company Duo World Inc.
GEQU‘s own share structure is another huge red flag. Since the start of the year the common stock of the company has been severely diluted as a result of the toxic funds GEQU “mistakenly”, as they described it in one of their PRs, agreed to back in 2014. How do you mistakenly take on a massive amount of convertible debt is not exactly clear but between July and August approximately 75 million shares were issued as conversions at prices ranging between $0.00045 and $0.0007. Another 252 million shares were issued to the CEO and the CFO again at triple-zero prices as a conversion of debt owed to them. As a whole the OS ballooned from 36.3 million shares as of December 31, 2014, to 382 million as of August 12, this year.
In order to accommodate the issuance of shares on February 16 GEQU increased their authorized shares from 70 million to 500 million. That amount proved to be insufficient however and on August 25 another increase was performed – this time to 950 million common shares. Just 2 days later, as this 8-K filing informs us, 270 million shares were issued to the CEO, CFO, and one of GEQU‘s directors. This means that currently there are over 752 million outstanding shares.
At least with no more convertible debt and the amended loan agreement the balance sheet of the company has improved significantly. The problem is that GEQU will need to find new sources of funds and this time the terms of the deals must be a lot more favorable. When you are deciding whether to put your money into the stock or not you should also take into account the alert emails touting GEQU that are being sent by the pump outfit Penny Stock Dream.
