MCig, Inc. (OTCBB:MCIG) Still On The Rise

MCig, Inc. (OTCBB:MCIG) may have fallen far during the latest wholesale market crash, but it seems to be on the road to recovery now. Yesterday’s session took it 7.01% up, despite the lack of news or filings.

A simple comparison between figures in current reports of companies in the marijuana branch may lead an investor to believe that MCIG is one of the more sound companies on the market. MCIG is a fully reporting company on the OTC, rated QB, and its latest 10-Q, for the period ended Jan 31, 2014 showed the following:

  • Cash – $37 thousand
  • Total Current assets – $91 thousand
  • Total current liabilities – $22 thousand
  • Quarterly revenues – $85 thousand
  • Quarterly net income – $10 thousand

Although said figures are unimpressive in and of themselves, MCIG certainly does have more than many of its competitors on the market, and unlike most pot stocks isn’t struggling with crushing debt. In fact, it’s actually making a profit, however insignificant it may be. Add that to the company’s press releases, which announced that it had made some serious revenues this month and it immediately becomes clear why it regained investor support quicker than most companies that crashed with Growlife Inc. (OTCMKTS:PHOT) on Apr 11.

Yesterday MCIG closed at $0.595 on a 4.3 million dollar volume, which is no mean feat as far as first steps to recovery are concerned. What is disturbing about it, is the ratio between the company’s market cap and its assets. Namely, the fact that the company’s traded for a sum 1766 times bigger than its total assets. Although such a huge gap seems to be commonplace in the hype-driven marijuana sector lately, the figure can’t help but be off-putting to investors. It suggests that the stock is currently severely over-hyped, and overrated – thus its fate is uncertain. Despite the promise this particular stock may show, “Let the buyer beware” seems to be as appropriate as ever when dealing with MCIG.

And it’s not like MCIG‘s is alone in this precarious state – other e-cig stocks have it even harder. Vapor Brands Int’l, Inc. (OTCMKTS:VAPR) for instance ended up falling 7.45% yesterday.

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