NYBD Holding Inc (OTCMKTS:NYBD) Surges Ahead of Ticker Symbol Change
Last week, NYBD Holding Inc (OTCMKTS:NYBD) announced that all the documents have been filed and all the approvals have been given for the change in the company name and ticker symbol. Apparently, NYBD will really soon be traded as AQUA.
Looking at the recent performance, we can see that investors are happy about this. Four sessions of active trading resulted in a run from just $0.0002 to $0.0009 per share. Yesterday, the stock also registered a dollar volume of nearly $440 thousand which means that a lot of money is on the line and many people are ready to trust NYBD and its new business plan. But should they?
The press releases certainly sound promising enough. Over the last nine months or so, NYBD signed numerous distribution agreements, entered several markets and announced that their expectations are quite high. Probably a bit too high.
On November 26, for example, they issued a press release which informed us that they have executed a purchase order with a Southern California distributor. They also said that their “projections for this market during the first quarter of 2014 are for over $250,000“.
The 10-Q covering the period ended March 31 came out on May 15 and it painted a completely different picture. It said that they have generated absolutely no revenues during the first three months of 2014 and it also told us that the company “has recorded a few sales in the online store“.
The rest of the statement looks pretty dismal as well. Here’s a summary of the most important figures:
- cash: $1,042
- current assets: $37 thousand
- current liabilities: $3 million
- quarterly net loss: $1.3 million
As you can see, NYBD is in a bit of a financial mess and despite all the optimism coming out of the PR articles, the figures above raise some rather big question marks around the company’s future. And that’s not even the biggest problem.
Between February 12, 2014 and May 15, 2014 (a period of just ninety-two days) a staggering 895,754,589 NYBD shares saw the light of day. If you take a closer look at the filings, you’ll see that most of them were printed as a conversion of notes and, as is often the case, they were all issued at some considerable discount. Where is all the toxic debt coming from?
If you’ve been around penny stocks for long enough, you won’t be too surprised to find out that the majority of the convertible notes were held by Asher Enterprises – an entity with a less than spotless reputation.
The dilution coming from Asher’s notes has played a huge role in keeping NYBD deep in triple-zero territory. If the stock issuance continues, the ticker could be in for another crash. Even if the management team succeed in freeing the company from all the toxic notes, they’ll need to think about getting the business off the ground as quickly as possible.
The new ticker will not be enough to stop NYBD from sliding if these conditions are not met which is why carefully considering the risks of a potential investment and doing a lot of due diligence is absolutely essential.