The Pump For eCrypt Technologies, Inc. (OTCBB:ECRY) Recovers Its Losses
On November 20 the pump outfit StockTips announced that their new pick is eCrypt Technologies, Inc. (OTCBB:ECRY). The influence of the newsletter is so big that on the very next day the stock exploded adding 150% to its price on a trade volume just short of 30 million shares. The dollar value for that session reached $9.54 million.
Just two sessions later though the management team of the company published a PR distancing themselves from the ongoing promotion. They stated that they are ”unaware of any business reason for the sudden increase in market activity”. The press release put an immediate stop to stock’s ascent and ECRY crashed by 26%, followed by an even steeper decline of 29% on the next day.
Well, all it took were a couple of new emails from Mike Statler, the fictional co-editor of StockTips, and investors started rushing towards ECRY once more. Yesterday the ticker surged by 39% and managed to so far has recovered almost all of its losses.
It should be obvious that for the moment ECRY must be regarded solely as a pump play. If you plan your trades carefully the increased awareness should present opportunities for some quick gains. The problem is that if you miss the right timing you might be left holding the bag. StockTips’ pumps usually end abruptly – take for example their previous pick Alkame Holdings, Inc. (OTCMKTS:ALKM). The last email for them came on September 29 but instead of informing us that the pump is over Mike Stalter still talked about why he loved the stock so much.
The same may very well happen with ECRY and when it does the company will have to support its price on its own. And judging by their last reported financials even the current price seems to be grossly inflated. At the moment ECRY command a market cap of $43 million while their financial results for the quarter ending September 30 were:
• $25 868 cash and total current assets!!!
• $31 thousand total assets
• $1.8 million total liabilities
• ZERO revenues
• $164 thousand net loss
With a disclosed budget of $5.1 million the pump for ECRY might continue for a while. If you are determined to trade the stock be sure to take into account all the risks and to adjust your position accordingly.