Anastas Gegov

Hemp Inc (OTCMKTS:HEMP) Performs A Reverse Split

by Anastas Gegov July 31, 2015

Just like many other pot stocks Hemp Inc (OTCMKTS:HEMP, HEMP message board) wasn’t doing well since the legal marijuana hype from last year dissipated. The company did manage to make an impressive climb earlier this month, but quickly returned to its downward slide.

 

One of the reasons for which HEMP couldn’t hold its ground was the fact that the company’s market cap of over $40 million was already looking quite steep when you compare it to what the contents of its books were. Here are just some of the numbers that were contained in the company’s report for the first quarter of the year.

 

  • cash: $632 thousand
  • current assets: $2.3 million
  • current liabilities: $2.27 million
  • quarterly revenues: $6,223
  • quarterly net loss: $1.08 million

 

But even more troubling was the massive dilution that HEMP underwent in the recent past. As we have written before, the company increased its authorized shares from 3 BILLION to 5.5 BILLION after reaching an outstanding share count that surpassed 2.7 BILLION as of March 31.

 

An even though the company stock received enough breathing room we see that HEMP has executed a 1 for 10 reverse split today that should have reduced the outstanding share count to around 270 million. This, of course, leave quite a lot of room for further dilution and considering the massive amount of outstanding shares that the company has we might see it very soon.

 

Meanwhile, yesterday session ended with a 13.33% loss and HEMP closed at $0.013 with a total of 26 million traded shares and a daily dollar volume of $352 thousand. HEMP is sitting at this price since today’s market open as well and only time will tell where the ticker will go from here on.

Comments 21

1. Guest
August 04, 2015, 04:09PM

Quotes I also am waiting for my shares to clear etrade tells me were all waiting for hemp inc to distribute the new shares

2. Guest
August 04, 2015, 01:33PM

Quotes guest 6 you are smoking to much hemp

you have it totally backwards....fail.....10 become 1.....reverse not 1 becomes 10

3. Guest
August 04, 2015, 11:05AM

Quotes Have two ## after Hemp I have Scott Trade. Still have not seen a correction. I have read that it might take a week or so. I would like to know if there was anyone that got in on the trade Friday when it went to a 1.00. I would like to know what triggered that. And went straight down. Something is going on I hope it is a good thing. They are getting ready to launch.

4. Guest
August 04, 2015, 10:47AM

Quotes I would say if your a long term stay.

5. Guest
August 04, 2015, 10:38AM

Quotes I called TDA. I had a sell (hemp) for 0.25. It opened at a 1.00 July 31.In reality, my shares sould have sold for a dollar, but didn't.was it a flash in the pan? My 30,000 now 3,000 is at .018. Two things, why didn't it sell and why does TDA have me in limbo. They said they have no new shares yet. Anyone else having this problem

6. Guest
August 03, 2015, 12:20PM

Quotes not exactly, we have less shares but they are worth more.

7. Guest
August 02, 2015, 09:20PM

Quotes In reference to the reverse split. If you have 100 shares you will now have 10. Thats why it is called a reverse split. The company will be evaluated with the new number of outstanding shares which will likely be around the previous market cap, unless of course investers see this as a huge plus for the company in the short term.

8. Guest
August 02, 2015, 11:39AM

Quotes 1 for 10 ReVERSE STOCK SPLIT MEANS THAT FOR EACH SHARE OF HEMP YOU HOLD, YOU WILL GET 10.
YOU SAID THAT YOU OWN 18,000 SHARES OF HEMP, SO YOU'LL OWN 18000x10=180,000 shares of HEMP after the reverse split.

9. Guest
August 02, 2015, 11:29AM

Quotes Did HEMP stock shoot up to $1.00 this last Friday, for real?
So if someone held, say 500,000 shares and had placed a limit sale order at $1 then that person made a cool $500,000?

Please tell me I'm not right!

Yours mr. Skeptic

10. Guest
August 01, 2015, 11:31PM

Quotes Is there any of you penny slot..oops stock folks out there that can explain this reverse split in dollars and shares....

11. Guest
August 01, 2015, 09:51PM

Quotes -meh.

12. Guest
July 31, 2015, 09:03PM

Quotes Not to mention the restructuring fees we will all have to pay for this sht.

13. Guest
July 31, 2015, 08:53PM

Quotes It's probably better to short all these penny stocks rather than thinking they'll rise to their promoted dreams.

14. Guest
July 31, 2015, 06:16PM

Quotes ive got 15 thousand shares of hemp stock does 852 dollars invested does this mean it went belly up and now I don't have anything

15. Guest
July 31, 2015, 06:04PM

Quotes I do not think anybody knows what is going to happen. I have seen this stock go to 1.38 from 2 cents in 1 day. This occured when Congress legalized the CBD portion of the marijuana plant. That was in Feb 2014. It is a penny stock so it is volatile. Soon as more states legalize medicinal and recreational use of marijuana, the stock will probably increase. It truly is a gamble. Most sub-penny and penny stocks usually are a gamble. The only thing you can do is keep your fingers crossed. Yet common sense will tell you that American culture is changing its' attitude toward marijuna use.

16. Guest
July 31, 2015, 05:57PM

Quotes Is this good or bad? SHould I sell?

17. Guest
July 31, 2015, 01:35PM

Quotes I'm still bullish on this stock. The CEO is very transparent about his operations and seems determined to focus on long-term success in the industry. Let's hope it pans out

18. Guest
July 31, 2015, 01:01PM

Quotes "Does anyone feel blindsided by this?"

This is not uncommon. Happens fairly frequently in the penny stock world. It's what happens now that's important.

19. Guest
July 31, 2015, 12:31PM

Quotes You could see it coming. they had to reduce the amount of outstanding shares. I'm surprised it wasn't a bigger ratio.

20. Guest
July 31, 2015, 12:04PM

Quotes I think that immediatly post reverse, the number of outstanding shares could be closer to 420M, because according to the Amended Articles of Incorporation (found on the Colorado Secretary of State's website) the reverse will also convert the outstanding Preferred K shares to commons at a 1:1 ratio.

I believe that there are 150M outstanding Preferred K shares (CEO Perlowin owns most of them,) so those will be converted to 150M shares of the common, which will take the OS to at least 420M.

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