Borislav Tonev

NanoTech Entertainment, Inc. (OTCMKTS:NTEK) Headed North Once Again

by Borislav Tonev August 21, 2013
35NTEK.pngIt's been nearly a month since we last wrote about NanoTech Entertainment, Inc. (OTCMKTS:NTEK, NTEK message board) and if you check out our latest article on them, you'll see that the stock was just starting to recover from the promotional campaign that took place in mid-July. You'll also see that we were eagerly expecting the next financial report which was supposed to contain some really exciting figures.

If you examine NTEK's chart closely, you'll notice that the ticker closed yesterday's session at $0.66 - pretty much exactly the same value as the one from twenty-three days ago. With that in mind, you'd probably think that they have either failed to file the all important annual report, or that if they have managed to do it, it's probably not that exciting. You'd be wrong.

The financial statement came out on August 14 and before we start analyzing the numbers contained in it, we'll summarize the most important figures in case you haven't managed to have a look at it yourself:

  • cash: $33 thousand
  • current assets: $312 thousand
  • current liabilities: $115 thousand
  • yearly revenues: $1.1 million
  • yearly net loss: $309 thousand

If we are to pick faults with the financials above, we would probably say that just $33 thousand in the bank is not that much and we would point our finger at the net loss, but in the case of NTEK, there is something much more important.

It would appear that the entire financial situation of the company has changed a lot over the last quarter. Working capital deficit has been dealt with, the revenues have been massively improved and it would appear that the second three months of 2013 is the first period that ended with an actual profit for the company ($172 thousand).

In addition to this, NTEK have managed to keep dilution at bay by actually decreasing the number of outstanding shares during the period between March and June, and we got a confirmation of the news that they have also reduced their authorized capital from 900 million to 740 million. Even the "Going Concern" doubts seem to be gone now which is something that we rarely get to see in Pennyland.

The press releases coming out of the company HQ also sound pretty good. NTEK announced on August 5 that they are planning on retiring a further nine percent of their outstanding shares and they also informed us that they have completed a couple of more acquisitions. Apparently, all of the new subsidiaries are going to help boost shareholder value.

Yet, despite all the positive news, the ticker seems a bit reluctant to go up. The latest financial statement and the accompanying press release went online around noon on August 14 and yet, the session ended in the red. The next day saw some more losses and while it has started to claw some ground back up, the trading volumes are still below the three-month average.

Normally, when there's so much good news around a volatile penny stock, we expect to see a lot more movement. Then again, a more sedate performance probably isn't such a bad thing. After all, back in July, the excitement of the promotional emails as well as a couple of optimistic press releases pushed the ticker up at a rapid rate but the momentum ran out pretty quickly and the price plummeted.

Hopefully the paid pumpers will keep their distance from the ticker for the time being and it will be left to move along under its own steam. That way, the risk of a sudden movements up and down such as the ones displayed by Virtual Sourcing, In (OTCMKTS:PGCX) and Alkaline Water Company Inc (OTCBB:WTER) will be reduced. Still, although long-term potential no longer seems like a distant dream, NTEK still has its air of volatility, which is why you should be careful to consider all the dangers before making your final decision.

Comments 1

1. Guest
August 21, 2013, 05:33PM

Quotes NTEK is the mody solid penny play I have found in recent memory. This company and it's founders are working to make good on their word, something rarely witnessed in pennyland. Kudos to NTEK for how far they've come, and where they are headed!

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