MyEcheck Inc (OTCMKTS:MYEC) Refuses to Climb

1MYEC.pngOn February 26, MyEcheck Inc (OTCMKTS:MYEC) announced their intentions to offer their services to players in the legal marijuana industry and this, apparently, was enough to draw in quite a lot of attention. The trading volumes increased and the ticker burst out of the sub-penny levels. A month later, MYEC hit a 52-week high of more than $0.08 per share and some people reckoned that it has enough grunt to go even higher.

Unfortunately, things didn’t quite work out that way. The hype around the marijuana industry dissipated somewhat and quite a lot of investors got scared by the suspensions of some of the pot stocks. Although MYEC has never really been what’s often referred to as a “pure marijuana play“, it too felt the effects of the diminishing excitement. In just a month, the ticker managed to wipe out around 40% of its value.

During the first half of May, MYEC was fluctuating wildly and was extremely unpredictable. Many people hoped that the Q1 report will change all that and will result in a more consistent run up the charts. The statement was filed on May 15 and the set of figures found in it would certainly have suggested a less volatile performance. Here’s what MYEC recorded on March 31:

  • cash: $19 thousand
  • current assets: $1.6 million
  • current liabilities: $499 thousand
  • quarterly revenues: $1.36 million
  • quarterly net income: $1.32 million

As you can see, the company seems to be on the right path and people were expecting to see the stock do the same thing. Yet, it didn’t.

MYEC remained just as volatile over the following weeks and even the appointment of a new Vice President of Sales and the removal of the DTC chill failed to get traders all fired up. Yesterday, the ticker wiped out another 15% of its value and finished the session with a share price of $0.033 and a dollar volume of $465 thousand.

Not exactly the best start of the week and yet, some people don’t seem too bothered about it. There are plenty of investors around the discussion boards who predict that MYEC will be a NASDAQ stock in a couple of years’ time. They are also speculating on a potential buyout from some of the big names in what is undoubtedly a huge industry. Some people, however, seem a bit worried about a problem that we discussed in our previous articles – the share structure.

It’s up to you to decide which side you want to take, but we should probably note that there are plenty of questions around the recent stock issuance.

MYEC‘s annual report tells us that on December 31, the O/S count stood at around 3.7 billion shares. According to the Q1 statement, between January 1 and March 31, the company issued 425 million shares of common stock as a settlement of debt (at an undisclosed rate) and they also bought 1 billion of Edward Starrs’ shares which were later canceled.

If you do a quick calculation, you’ll see that after all these transactions, the number of issued and outstanding shares should be 3.2 billion. And yet, according to the Q1 report, on March 31, the O/S count stood 4.1 billion. Where did the difference come from?

8MYEC_logo.pngThere’s another interesting question that, unfortunately, remains unanswered. MYEC want to become a leader in the online payment business – a field where credibility is extremely important. Why, then, are they using a UPS Store as the address of their company headquarters?

Contemplating these questions carefully and doing your own research and due diligence before putting your money on the line is absolutely essential.

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