Borislav Tonev

XLI Technologies Inc (OTCMKTS:XLIT) Crumbles to Dust

by Borislav Tonev March 29, 2016

On March 18, James Schramm, XLI Technologies Inc (OTCMKTS:XLIT, XLIT message board)'s CEO announced that he has canceled a total of 65 million shares. That's an O/S count reduction of over 60%. In theory, it should have given the ticker a massive boost. This is Pennyland, however, and in here, theories are nothing more than... well... theories.

Instead of going up, XLIT continued tumbling down and it managed to drop from over $0.34 prior to the press release all the way to yesterday's close of $0.13. Couple this with the two horrifying sessions on March 16 and March 17 and you'll end up with losses of more than 89% posted after just two weeks of trading.

Plenty of people were most likely caught off-guard by the steep drop, but was everyone really that surprised? The investors who took the time to do their due diligence were probably expecting a crash.

XLIT first popped up on the radar back in October when it was still trading under its previous ticker symbol. Back then, it was fairly easy to realize that the hype around the merger with Bosch International LLC was a bit excessive. It was also fairly easy to find out that about 25 million of the issued and outstanding common shares were originally sold for just $50 thousand.

In fact, XLIT looked like it was being set up for a rather big stock promotion. Sure enough, shortly after the new ticker symbol was assigned, the promotion did start.

Charles Moskowitz wrote a report on XLIT, and the disasters he created with EMS Find Inc (OTCMKTS:EMSF), Virtus Oil and Gas Corp (OTCBB:VOIL), and Spriza Inc (OTCMKTS:SPRZ) should have set off some more warning lights. Once he was gone, a few newsletters tried to tout the ticker and the results are now pretty evident.

The promotion and the cheap shares issued some time ago weren't the only things that should have warned investors about a potential drop. XLIT picked up quite a lot of debt convertible at a 40% discount over the last few months which, on its own, is a pretty huge red flag as well.

All in all, it was not that difficult to see that XLIT was going to have a hard time staying calm under the pressure. Predicting the future, however, could be a bit more tricky.

Earlier today, XLIT issued a press release announcing the placement of printed Lightsheets in 250 theater locations, and although this pushed the ticker in the green for a few minutes, about a quarter of an hour into the session, it's traded at $0.125 (about 6% in the red).

Some solid financial reports might just restart interest in the stock, but even if they do, the major pitfalls outlined above will still remain. Considering them carefully is extremely important.

Comments 0

Type the characters that you see in the box (5 characters).