Is Max Sound Corp. (OTCBB:MAXD)’s Jump Coming To An End
Max Sound Corp. (OTCBB:MAXD) had an impressive run that lasted all throughout this week, but now it looks like it has come to a screeching halt. So where will it go next?
Well, since this is a rather volatile OTC Markets penny stock we’re talking about, it’s next to impossible to predict its immediate behavior. However, there are some indicators as to what might be its ultimate fate.
The first indicator we’re going to talk about is something know as “commons sense”. MAXD made a big deal about filing lawsuits against YouTube and Alphabet Inc. (NASDAQ:GOOGL) formerly known as Google . They made a big public announcement that they have managed to pay the necessary legal fees, and that a decision by a German court is expected to be reached in a matter of months. How they intend to battle the army of lawyers that the two international megacorporations can muster in a court of law is unclear, but the ultimate result that effort is going to have should not be all that difficult to predict.
Sad to say, the company doesn’t have much more than the hype surrounding the abovementioned lawsuits going for it. Its finacials are downright cringe-worthy:
• cash – $6 THOUSAND
• current assets – $90 thousand
• current liabilities – $6 MILLION
• NO REVENUES EVER
• net loss – $2.8 MILLION
But wait, there’s more! Page 12 of the 10-Q for Q2 of 2015 state that as of June 30, MAXD owes noteholders approximately $3.16 million. Another $425 thousand worth of convertible debt has come into existence between July 2 and August 7.
And if the potential dilution that said debt represents wasn’t bad enough for investor value, a large portion of the notes in question can be turned into shares at discounts to MAXD‘s market price ranging from 25% to 40%.
This might be just what we’re witnessing right now – the ticker being dragged right back down by enterprising noteholders making money through questionable means. Alternatively, it may just be that investors realized that MAXD‘s situation is not really all that rosy and decided to sell some of its stock while it is still liquid. Or it may be just random volatility hurling the ticker up and down the charts. Only time will tell.
