Violeta Slavtchevska

Rackwise, Inc. (OTC:RACK) Surges Up on a $1.49M Promotion

by Violeta Slavtchevska April 25, 2012
Rackwise, Inc. (OTC:RACK, RACK message board) share price more than doubled in less than three trading sessions this week. That action has been supported by a massive promotional campaign which started on Monday afternoon and by a press release occurring a few hours earlier. RACK.png

The latest trading session closed at $1.41 for a share which represents a 19.49% increase from the previous close. Trading volume almost tripled from the preceding session and exceeded 659,000 traded shares in a day. That amount of traded shares is at least 26 times higher than the daily average for the past three months and accompanied by the surge of the share price illustrates the common effects of an expensive stock promotional campaign.

Our database shows that the first e-mail arrived after market close on Monday. The compensation to be paid for advertising RACK to traders is quite shocking - the promoter says he should receive $1,490,000 for the campaign and it is expected to run for about six months. Together with the advertising e-mails RACK issued a press release in which it claimed the U.S. Army had increased the usage of the company's DCiM solution to manage its primary and satellite data centers.Rackwise.jpg

Unfortunately, RACK recent financial condition is not as bright as its recent performance on the stock market. According to the company's annual report for 2011, at the end of last year RACK had current debts for more than $4.8 million which it could impossibly pay without raising outside capital, while the company has no stable revenue source and has been reporting huge losses in the last four quarters.

Comments 2

1. Guest
April 26, 2012, 12:06AM

Quotes The press release about the army corp was a repeat of a similar press release in october of 2011 which has magically disappeared from their website. In addition, the "big deal" they won for 60 data centers at Intel was done for zero revenue. So i guess Rackwise will lose money on every deal and make it up in volume ( as the old joke goes).

2. Guest
April 25, 2012, 02:18PM

Quotes This co. has no stable revenue source. They are in debt and will need to borrow from Paul to pay Mary...

INVESTOR BEWARE dont get caught up in the trade

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