Valmie Resources Inc (OTCBB:VMRI) became a target of promotional emails in mid-March. It initially resulted in price surge from $2 per share to a high of over $3.20. However, soon it halted the upward trend and started to decline. It posted its last green session two weeks ago and from there on has declined more than 60%. In yesterday’s trading session, the stock declined more than 24% to close the trading session at $1.06. The decline came at a share volume of 111,529 compared to average share volume of 53,569. The high for the day was $1.30 and low was $1.02.
The promotional outfits are unfazed by the recent price momentum and they are still busy sending the promotional emails. Recently Valmie announced that it is going to be present in the Unmanned Systems 2015 event and requested potential acquisition candidates to get in touch with the management team so that they can discuss future associations. However, it doesn’t seem to have any impact on investors and there is every reason for it.
Valmie when was trading at more than $3 a share, its market capitalization stood around $180 million mark. The shareholders at that time were expected strong financial numbers from the quarterly report for the period ended February 28. They were disappointed when the company reported $5,277 in cash, total assets of $31,127 and $349,746 as total liabilities. The company recorded no revenue since inception, and the quarterly net loss came at $135,320.
The red flag
The SEC filings disclose that almost 59 million shares of Valmie’s common stock were sold for under $10,000. Recently, the company converted $383,927 worth of debt into 3.8 million shares of common stock at a conversion price of $0.10 per share. The financials and the conversion clearly indicate the problems with the company.