Valmie Resources Inc (OTCBB:VMRI) Sinks Like a Stone

Should you trust everything you read in Valmie Resources Inc (OTCBB:VMRI)’s press releases? Let’s take a look at the one from May 21 and find out.

It was actually a letter to the shareholders in which the company outlined some of the milestones they have reached over the last few months. Predictably, they spoke about the acquisition of Vertitek and they labeled their new subsidiary a “tech frontrunner”. In an 8-K form from yesterday, however, they described Vertitek as an “up-and-coming UAV manufacturer”.

The 8-K itself is quite interesting. VMRI announced the closing of Vertitek’s acquisition at the end of March, but they failed to publish an 8-K containing the new subsidiary’s financials. Nearly two months after the deal was closed, they finally did it, and they showed us that Vertitek is not the most financially healthy company out there. Here’s what the figures looked like at the end of January:

  • current assets: $21 thousand in cash
  • current liabilities: $25 thousand
  • NO revenue since inception
  • quarterly net loss: $2 thousand

Now that you have the financials, you should be able to decide whether Vertitek really is a “frontrunner”, an “up-and-coming UAV manufacturer”, or a small financially distressed company.

In the meantime, let’s get back to VMRI‘s press release from last week. It talks at some considerable length about the things VMRI did since changing its business plan. Every single piece of news has been reiterated, and, to add just a little bit more optimism, some future projections have been included. The management team somehow forgot to talk about the stock performance, however.

It’s been pretty catastrophic. On May 5, VMRI was flirting with the $1.60 per share mark, but during the following two weeks, it dropped to less than $0.70. The optimism from the shareholder letter did result in a short bounce, but at the beginning of this week, VMRI simply crumbled to dust. Three consecutive red sessions brought it down to yesterday’s close of just over $0.45 per share.

The management team also forgot to comment on the reasons for the horrific losses that some investors were forced to incur. It wasn’t some bad news coming from the company headquarters. It wasn’t even the poor financial statement that they presented us with. It was all due to a massive paid pump which, by the way, continues to this day.

It started just over two months ago, and in that short period of time, the pumpers managed to send out exactly 140 emails. The latest batch of alerts arrived thanks to Investor Soup as well as the rest of the newsletters owned by Action Media Holdings and Stock Hideout. A massive amount of money has been spent on pumping VMRI and we won’t be too surprised if we see some more being splashed out in the near future.

Last but not least, when they were writing the shareholder letter, the management team forgot to say how some people acquired more than 59 million shares for less than $10 thousand a couple of years ago. They probably aren’t too keen on talking about this. We, on the other hand, have been discussing it for the better part of two months.

About thirty minutes after today’s opening bell, VMRI is sitting at $0.47 (3% in the green).

You may also like...