Dragni Dragnev

CANNABIZ MOBILE, INC (OTCMKTS:LGBI) Nosedives Towards Triple Zeros

by Dragni Dragnev April 2, 2015

CANNABIZ MOBILE, INC (OTCMKTS:LGBI, LGBI message board) crashed 35.14% yesterday, on a dollar volume of about half a million, returning back to the $0.0024 mark.

Truth be told, this turn of events is not surprising at all. Any investor who's done any due diligence on the company knows that LGBI is one of the more suspicious companies in the marijuana branch, even by the extremely lax standards of the OTC Markets.

The first red flag that gives a fair warning about it is the fact that last year, it was the target of a couple of paid pumps.

Further, its financials look like this:

  • Cash - $22 (NUMBER NOT IN THOUSANDS!!!)
  • total assets - $125 thousand
  • total liabilities - $748 thousand
  • Quarterly net loss - $46 thousand

And if those two red flags fail to convince investors of LGBI's dubious nature, there's also the fact that the company seems to think that paying with shares of common stock priced at a 45% discount to the current market price is a good idea.

And, as we all know, where there is toxic funding, there is also rampant dilution – and LGBI is no different in this regard. Case in point - the number of outstanding shares grew from 34 million as of Sep. 30, 2014 to to over 395.5 million as of April 1, 2015. That's an over 1100% dilution in just 7 months.

That number is so staggering, it almost sounds like a bad April Fools joke - but, unfortunately for LGBI investors, it isn't. 

Investors should do the math and think really carefully if they want to commit to the stock of a company that shows as many disturbing red flags as LGBI.

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