Georgi Kamburov

Cannabis Science Inc (OTCMKTS:CBIS) Slowly Climbs the Chart

by Georgi Kamburov April 28, 2015

For the past three sessions the stock of Cannabis Science Inc (OTCMKTS:CBIS, CBIS message board) has been making a slow but steady recovery. Yesterday the company gained exactly 3.95% and closed the trading day at $0.0395 per share. With nearly 6.5 million shares changing hands the dollar value for the session surpassed $261 thousand.

The positive momentum behind the stock is rather puzzling having in mind that just a couple of days ago CBIS filed their annual report for 2014 and frankly the numbers found inside are nothing short of atrocious:

• $10 thousand cash
• $166 thousand total current assets
• $3.95 million total liabilities
• $1031 revenues
• $16.8 million net loss

Your eyes are not deceiving you CBIS really managed to generate a little over $1000 dollars for the entire 2014 down 98% from the revenues for 2013. This means that last year the company generated around $86 dollars per month. At the same time the net loss increased by three times compared to the $5.6 million reported at the end of 2013. The accumulated deficit since inception is sitting just below $110 million.

If you thought that the picture can’t get any worse you were sadly mistaken. The outstanding shares of the company grew from 770 million to over 1 billion as of December 31, 2014. The issuance of shares hasn’t stopped and since the start of 2015 another 150 million shares have seen the light of day. In our articles we have often warned you that despite the dismal operations of the company millions of shares have been issued as bonuses to insiders.

Last year CBIS filed three registration S-8 forms – a 6,5 million shares under a Stock Compensation Plan A of which 6 million were issued by December 31; 6,5 million shares under a Stock Compensation Plan B of which 6 million shares were issued by December 31; 50 million shares under a Stock Compensation Plan C of which 39.9 million shares were issued by December 31. On March 25 CBIS submitted yet another S-8 form registering 50 million shares as 2015 Stock Compensation Plan.

Not surprisingly the people who received these discounted shares have been regularly selling them on the open market evidenced by the eight Form 4s submitted since the start of the year. The last one was filed on March 30 and revealed that between March 26 and March 27 the COO of the company sold 1.4 million of his shares.

Trading CBIS is extremely risky. At the moment the company commands a grossly over-inflated market cap of over $46 million. Any trades involving the stock should be preceded by extensive due diligence and careful planning. 

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