Normally, we don’t even comment on "trip-zero" stocks, or companies that are trading at a per-share price between $0.0001 and $0.0009. There’s not some standing rule; it’s just that companies trading at these price points typically have the type of fundamental flaws that justifies the price point, so, caveat emptor.
We couldn't help but be drawn in by the headline today of Simlatus Corporation (OTCPK:SIML) which read "SyncPal Product Export Sales Begin to Rock". A second headline declared "sizable sales orders" and a share buyback beginning. Certainly eye-catching from a company trading at $0.0001 and a market capitalization of roughly $71,000, according to data from Quote Media.
Simlatus Corporation, a self-proclaimed audio/video icon, designs, manufactures and sells 55 commercial broadcast products, such as production switches, routers and control panels, worldwide. Sales for the quarter ended December 31, 2016 totaled $5,905, according to SEC filings.
That said, the Grass Valley, California-based company reported preparing an export order for $138,000 in SyncPal orders and another $368,250 in orders for Simlatus legacy A/V high definition products.
Simlatus further said that is has order worth $524,468 being prepared for three large broadcast stations with over 100 studios in Europe and North Africa. Another "large pending order" is also expected to be announced in the next two weeks.
In May, Simlatus said it will begin shipping its new SyncPal product in July, with anticipation of $5 million in revenue in the next 24 months and $30 million over the next five years.
SyncPal fixes video/audio out-of-sync problems when the AES audio is embedded in the HD video channel by de-embedding the audio signal and re-embedding it back into the HD channel at the proper time.
The company plans to use some of the revenue to repurchase stocks, although it did not specify how much capital it intends to allocate to reduce the share count, which currently stands around 708 million shares outstanding.
So far, investors aren't buying the storyline or opportunity with 125.6 million shares trading hands at $0.0001 with about two hours left in the trading day on Wednesday.
Related Stories
