Endeavor IP, Inc. (OTCBB:ENIP) Gains, Slower
The sudden upward motion of Endeavor IP, Inc. (OTCBB:ENIP) is starting to struggle. The company, boosted by an expensive and widespread promotion, was awakened from near-frozen activity in the past years, and now offers a challenge to investors, who could either benefit from a good run, or fall prey to the post-promotion doldrums.
ENIP opened upward on Wednesday, and on Tuesday added a more modest 9$ to stand at 98 cents, on dollar volumes of above $563,000. In the past 12 trading days, only two were in the red, so far with a minor retreat. ENIP is public since May, but it took $1 million in promotional budget, a special landing page and a promotional video to make the ticker walk the walk.
C America Marketing is the manager of this promotion, and the landing page belongs to cleverly named Financier Times, which even counted it necessary to differentiate itself from the original Financial Times. MaxMind Marketing is the paying party.
And if you have not seen enough red flags, here is the financial situation of the company:
- cash: $450 thousand
- current assets: $501 thousand
- current liabilities: $640 thousand
- quarterly revenue: $100 thousand
- quarterly net loss: $262 thousand
Those data are, of course, not dismal, though it hardly justifies a market cap of above $41 million. So far, the company has just above 42 million shares outstanding, with 75 million authorized- dilution is possible, though much lower than lesser quality penny stocks.
The only worrying thing is what would happen once the promotion loses its novelty. We have the back story for a similar company, the Alkaline Water Co., Inc. (OTCBB:WTER), which started trading actively only after a wide presentation with a paper mailer, landing page and emails. WTER started well, easily vaulted the $1 levels, but retreated to hover between 50 and 60 cents.
Another selection, Montalvo Spirits, Inc. (OTCBB:TQLA) had all the right ingredients, but failed nevertheless on a flagging spirit, as recently the ticker made a dead cat bounce and now drifts sideways around 30 cents.
Newcoming tickers often promise a wild upward ride, since they had to wait so long to show their potential. But often, those runs either disappoint, or turn back to carve out a large portion of investors’ money. If you still see ENIP as having enough gas to continue, it is still best to avoid investing sums you cannot afford to lose.