Georgi Kamburov

WebXU, Inc. (OTCMKTS:WBXU) Spikes Thanks To Fluff PR and Pump

by Georgi Kamburov March 14, 2014
WBXUchart.pngWe last wrote about the stock of WebXU, Inc. (OTCMKTS:WBXU, WBXU message board) on the day they announced that the company will be entering the industrial hemp and medical marijuana industry through an agreement with HEMP, Inc. (OTCMKTS:HEMP). After months of infrequent trading the news took the market by storm, put investors into a state of buying frenzy and just in a matter of hours more than 34 million shares changed hands. As a result WBXU skyrocketed by the massive 330% and closed the day at $0.034.

In the weeks since then enthusiasm started to rapidly cool off and the PRs released by the company had minimal effect on the prevailing negative trend of the stock. On March 10 even a low-budget paid pump began for the company and it at least managed to stop the downwards slide. During yesterday's session WBXU was finally able to jump back up but it took the combined forces of both a fluff PR about the marijuana industry and another round of email touts. The stock gained 28%, reached a new record for traded shares of 46.8 million and once again returned to $0.034 per share.

Let's start with the PR article. In it WBXU revealed their intentions to offer financial services to companies involved in the the marijuana and hemp industries. Well, first of all WBXU is still describing itself as a media company that develops branded consumer websites so what expertise they have in the finance sector is up to you to decide. Furthermore WBXU should first take care of its own financial problems and the OTC Pink Limited Information sign that is sitting atop their OTCMarkets profile.

Back on April 1, 2013 the company submitted a notification of late filing for the annual report covering 2012. The reason cited by them was a delay in completing the necessary information. Apparently it took them whole nine months to finally complete it and on January 15 the annual report saw the light of day. At the end of January the accounting firm L.L. Bradford and Company LLC decided to drop WBXU as a client reducing the chances for a more recent financial report even further.

The pumpers involved in the promotion for WBXU are not among the more influential newsletters but they still helped in the creation of artificial hype around the stock. Whisper from Wall Street received $5000 for their services while Penny St0ck Spy and 007 Stock Chat disclosed $7000 in compensation. In the last emails all of them said that they will be moving on to find new picks. If that spells the end of the promotion or new pump outfits will take their place remains to be seen.

WBXU is an extremely speculative bet at best. Investors have no way of knowing what the current state of the company is and as we said the most recent data is now more than 15 months old. The ticker has also shown that it cannot sustain its inflated price solely on the marijuana hype and needed a push from the paid pump. Do your own due diligence and use caution when attempting any trades with their stock.

7HEMPchart.pngTheir partner in the marijuana field - HEMP, Inc. (OTCMKTS:HEMP) is also fallen on hard times lately. Their stock has dropped dramatically from the highs posted at the start of February when it briefly traded for more than 30 cents. Yesterday HEMP slid down by close to 3% and found itself at $0.12 per share. The stock of Terra Tech Corp. (OTCMKTS:TRTC) put an end to its tremendous run that saw them jump from $0.5 to $1.40 in just five sessions. Such heights proved to be far too unstable for the company and yesterday it corrected by more than 11% but remained far above the dollar mark at $1.24.

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