Terra Tech Corp. (OTCMKTS:TRTC) Sails Over the One-Dollar Mark
The marijuana sector of the OTC is still hot and volatile, even if it cooled down a little compared to the first month of the new year. However, some pot tickers are catching a major boost just now, including Terra Tech Corp. (OTCMKTS:TRTC). The company went through a streak that was nothing short of explosive, climbing from $0.50 to its last close of $1.18 in just four sessions.
There were a myriad of factors contributing to TRTC‘s massive green surge. The company was featured on Bloomberg TV on Friday, then announced a Fox Business appearance scheduled for today’s morning segment. Media exposure can contribute a lot in a market that’s already in a very excited state and this is likely what assisted TRTC on its way up.
TRTC is a company engaged primarily in hydroponics and growing equipment and greenhouses, going through a gradual shift of focus from edible fresh market produce to marijuana. The company announced applying for a marijuana license for the state of Nevada back in late January. The license is still not cleared but the news also added to the excitement around the ticker.
The question is, has TRTC achieved enough up to the present to warrant the wild increase in price that brought the market cap to over $145 million, how much of that is wishful thinking and how much is actual hard performance results. TRTC is still generating revenues from market produce in its facilities. Investors are, naturally, excited about the possibilities the company’s standing in hydroponics may offer for pot revenue streams but that’s still in the future.
Additionally, the financing deal TRTC signed with Dominion Capital LLC may have a negative impact on TRTC‘s price in the long run. The agreement stipulates that Dominion can purchase up to $6.55 million in notes and those notes will be freely convertible into TRTC common stock, under conditions that may affect retail shareholders.
The filing concerning the agreement states that the notes convert at a “price equal to 90% of the 20-day VWAP of company common stock prior to February 5, 2014, which price the Company estimates to be approximately $0.30753 per share.” TRTC is currently priced at $1.18. Dominion, on the other hand, has at least one convertible for $800 thousand on its hands and may convert it at about $0.30 per share. Traders should be able to do the rest of the math on their own.
With the huge volatility in the marijuana sector of the OTC, investors are advised to tread with caution and do their own due diligence before making a decision.