Once again Medbox Inc (OTCMKTS:MDBX) stock had started with its sharp decline as it continues to make new 52-week low after every few days. In yesterday’s trading session, the stock price declined more than 15% to close the trading session at $0.315. The decline came at a share volume of 721,357 compared to average share volume of 415,275. The previous session was no better as the stock plunged sharply to close at $0.37.
Here, it is better to ask is there anything really buzzing related to the company. Well, the answer is really no as Medbox is hardly issuing any meaningful PRs. The latest press release came in last week of May when the company announced that it finalized a distribution agreement for a vaporized branded as ‘miVape.’ The announcement resulted in one day gains as the following ten sessions ended in red with the stock eroding over 305 of the total market value. It is evident that the news failed to have a substantial impact on investors.
The problem of trust
By now, most of the shareholders and investors are well aware with the severe red flags associated with the company. All the problems for Medbox started couple of months ago when it had to restate financial reports for different accounting periods due to numerous revenue recognition errors that required fixing. The company’s founder Vincent Mehdizadeh stated that management was not really required to do the restate financial reports.
Medbox reported that it became the target of a SEC problem, associated to revenue recognition errors, in late 2014. The restated numbers highlighted huge errors as the revenue figure was largely different from what was previously announced and what was reported in the restated numbers. The massive error broke the confidence of investors in Medbox and they considered it wise to exit from Medbox Inc (OTCMKTS:MDBX) stock.