After the explosive first day of pumping, Well Power Inc (OTCBB:WPWR
, WPWR message board
) calmed down a bit yesterday and it let investors take a breather. It still finished the day 7.69% above its previous value and registered a dollar volume of $3.68 million, but this is nothing compared to the run from Monday.
So, what's going on? Is the hype slowly starting to subside? Or is WPWR preparing itself for another spectacular climb?
Early trading today suggests that the tables might be turning. About twenty minutes after the opening bell WPWR is hovering around the $0.30 per share mark which is roughly 12% below its previous value. Of course, there is still time for a miraculous recovery but we're not entirely sure that the ticker deserves it.
When estimated at yesterday's close, WPWR's market cap stands at around $37.6 million and that is a bit too much for a company that has no assets.
Yes, they did sign a licensing agreement with a Canadian enterprise called ME Resource Corp (CNSX:MEC) for the distribution of the revolutionary Micro-Refinery Units (MRU) and if you ask Stock Tips' editor, Mr. Mike Statler, he'll say that this piece of technology is going to make WPWR very rich. Then again, he and his colleagues received $4.1 million to pump the stock and we're not too sure that you should base your investment decision on his claims alone.
Yesterday, we touched upon a couple of the amusing discrepancies that can be found in his twelve-minute video, but today, we want to take a look at some of the more serious things.
Mr. Statler would have you believe that WPWR own the license to distribute MRU's throughout the US, but the filings show that this is not strictly the case. For the time being, they'll be able to sell the devices in Texas only and they will have that right if they pay MEC $400 thousand, which could be a problem considering the lack of assets.
Once they've made all the payments, WPWR will need to wait for MEC to complete the development stage and commercialize the product before even thinking about generating revenues. When the sales start, WPWR will have to set aside some royalties for the creators of the MRU's and they can then hope for a positive bottom line.
All these facts are explained in details in the 8-K filing published as part of the licensing deal and on page 6, there is even a timeline for the commercialization of the technology (which is the most crucial step). Take a closer look at it and you'll see that, if everything goes according to plan, the Pre-Commercialization Stage should be completed by the end of September 2015.
Did Mike Statler fail to read the 8-K? He was probably too busy calculating the profits from his previous picks and putting the numbers in his unnecessarily long video. Even there, however, he failed to include some interesting information. If you've seen the clip, you know that he talks at some considerable length about the huge profits that his subscribers might have made during the pumps for Amarium Technologies Inc. (OTCMKTS:AMMG), Pan Global Corp (OTCMKTS:PGLO), and Tiger Oil and Energy Inc (OTCMKTS:TGRO). What he doesn't tell you, however, is the end results which you can find on the right.
There is yet another thing to worry about. Yesterday, the SEC decided to put an abrupt end to the pump for Centor Energy Inc (OTCBB:CNTO). As you probably know, there will be a period of two weeks during which the ticker won't be traded and as soon as it's over, CNTO is heading for the Grey Market and, most probably, much lower price levels. Keeping that in mind while considering a potential investment in WPWR or, in fact, any other promoted penny stock, is absolutely crucial.