Borislav Tonev

BioLargo, Inc. (OTCMKTS:BLGO) Jumps out of Nowhere

by Borislav Tonev April 8, 2016

At the end of Wednesday's session, BioLargo, Inc. (OTCMKTS:BLGO, BLGO message board)'s trade count stood at... 1. Exactly twenty shares changed hands which resulted in no change in the share price.

By contrast, yesterday, investors completed 87 trades. The dollar volume at the end of the day stood at a little over $150 thousand and a price hike of about 24% pushed BLGO to a close of $0.41 per share. Why did investors suddenly decide to jump in?

Quite a few people are asking the same question, but unfortunately, an answer is nowhere to be found. The most recent press release is now fairly old and there doesn't seem to be an active promotional campaign going on.

The company did indeed publish its 2015 10-K last week, but there's not much in it to encourage you to put your money on the line:

  • cash: $1.8 million
  • current assets: $1.9 million
  • current liabilities: $460 thousand
  • yearly revenues: $126 thousand
  • yearly net loss: $5.1 million

Sure, the figures aren't as horrific as what we've seen from other penny stock companies. The sales have actually experienced a small increase on a year-over-year basis, but for the time being at least, the expenses are too big to ignore and there can be no guarantees that BLGO will manage to rein them in.

At the same time, there was some convertible debt outstanding at the end of last year. The notes aren't convertible at a steep discount, but the dilution can still weigh the stock down.

Couple this with the fact that currently, BLGO seems to be running on thin air and you'll see that the dangers are indeed pretty substantial. Considering all the risks is extremely important.

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