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January 13, 2012 – Comments (15) | RELATED TICKERS: RIHT

Yesterday, in CAPS, I red-thumbed Stevia Corp:  STEV.OB

Ouch!

The stock is up somewhere in the neighborhood of 75% today.  Ah well, I'm not worried.

Is it up on news?  Nope.

Up on good earnings?  Nope.

Was I wrong to red-thumb this ticker in the first place?  Nope.

Here's what amazes me more than anything...  according to data on CAPS and Yahoo Finance, Stevia finally had some revenue over the most recent quarter (but none before that).  The reported revenue?

$1,300

That's right, $1.3K

Ok, that's not the really surprising thing.  There's more.

The balance sheet?  $77K in cash, $1K in receivables, $6K in other current assets and $5K in intangible assets for total assets of a whopping $89K.

We're not to the best part yet.  I could go over liabilities, or cash flow, but I think I've made my point.  A behemoth, Stevia is not.  $1.3K in revenue and $89K in total assets paints the picture well enough I think.  What *really* suprises me?

Not that the stock has jumped about 75% so far on the day...  nope, that's not it.

It's that according to CAPS, about 7.7M shares have traded hands today.  Even multiplied by the day's low (and many trades were well above this low given the run-up in price), that means that $77M traded hands today between buyers and sellers of a company with $1K in revenue and $89K in total assets.

Who are these people who buy this stuff?  Seriously?  Ok, it could be the same day traders selling back and forth to each other, but still.  Really?  Really?!

$77M trading hands on this?  In one day?

It just leaves me scratching my jester cap in utter befuddlement.

Regards,

Russell (a.k.a. TMFEldrehad)

15 Comments – Post Your Own

#1) On January 13, 2012 at 4:24 PM, outoffocus (23.03) wrote:

Stevia should be filing a schedule C.

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#2) On January 13, 2012 at 4:27 PM, SultanOfSwing (32.60) wrote:

TMFEldrehad,

Thanks.  Just put my limit order in for Tuesday.  Easy pickings as you pointed out.

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#3) On January 13, 2012 at 5:32 PM, HarryCaraysGhost (84.01) wrote:

Ha, Ha Just looked at my red thumb from way back at.75 down -126.85 Caps points.

Shoot that might turn around next week.

The Pump is in full flow. (Still I was suprised by the $77M also, they're going all in with this one)

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#4) On January 13, 2012 at 5:42 PM, HarryCaraysGhost (84.01) wrote:

And congrats on being top Fool again.

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#5) On January 13, 2012 at 6:05 PM, ETFsRule (< 20) wrote:

Stevia Corp. appears to have a weak balance sheet, highlighted by its negative owner's equity. Most likely, this was caused by cumulative losses which negatively impacted retained earnings. Additionally, this company's debt load is greater than its assets while day-to-day operations are losing money. Stevia Corp. has considerable financial risk.

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#6) On January 13, 2012 at 6:45 PM, ikkyu2 (98.25) wrote:

Negative equity.  There's a new one.  Means that if you own shares, you owe the company more than the share's par value.

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#7) On January 17, 2012 at 5:54 PM, SultanOfSwing (32.60) wrote:

Baa-aaaa-aaaah!  (my best sheep imitation).  About 60 players red-thumbed STEV.OB since you posted this, including me!  Could it be that so much short interest, as reflected by recent CAPS picks, will actually keep this stock price from falling?  Any little rally will magnify in a feedback loop due to short covering.  The next 2 weeks for STEV.OB should be interesting to watch.

Gee, don't people do their own DD any more?!?  That's a rhetorical question.

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#8) On January 17, 2012 at 8:07 PM, constructive (99.96) wrote:

"Stevia should be filing a schedule C."

Or a chapter 7.

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#9) On January 17, 2012 at 8:21 PM, constructive (99.96) wrote:

I wrote a longer post but it looks like CAPS ate it.

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#10) On January 17, 2012 at 8:23 PM, constructive (99.96) wrote:

SultanOfSwing

When it comes to OTC pumps, CAPS is not a very good reflection of real life.  There are not that many people shorting OTC stocks.  For example, RYUN.OB, JAMN.OB, and AMNL.OB (all of which I'm short in real life) have less than 50K shares short, well under 1 day to cover.  STEV.OB days to cover has got to be microscopic given the ridiculous volume.

Let's see if posting a 5th time works?

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#11) On January 19, 2012 at 6:26 PM, CMFEldrehad (99.99) wrote:

When it comes to OTC pumps, CAPS is not a very good reflection of real life.

This is a little off-topic and has nothing to do with Stevia, per se, but CAPS as I understanding isn't supposed to be, nor is it trying to be, a reflection of real-life.

CAPS asks the questions:  Who are the best stock-pickers? (Not investors, or portfolio managers, but stock-pickers)  And, based on the opinions of the group, with the best stock-pickers' opinions counting more, what are the best stocks?

CAPS isn't perfect, but, I think it does pretty darn well at what it is attempting to do.

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#12) On January 20, 2012 at 11:01 AM, constructive (99.96) wrote:

Eldrehad,

That was my point, that CAPS is not real life and sentiment should not be confused with short interest.

There are lots of places online where people discuss how GREAT their favorite stocks are (even if they are horrible).  But one of the best things about CAPS is that negative/skeptical views are accepted as part of the conversation.  In part because of the scorekeeping aspect.

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#13) On February 03, 2012 at 5:11 PM, whoitis12 (< 20) wrote:

I don't have the greatest rating on CAPS, and I don't claim to have a huge amount of experience with investing.  I am not versed in the language either.  However, I do not believe those are the skills necessary to sift through the confusion about this stock. Often, there is an element that has more to do with the psychology of people than a company's financial history that is playing a part in the sudden interest or disinterest in a company when it comes to how stocks are trading (that or a well-placed rumor, right?)  Anyway, do you know what Stevia is?  It is a low calorie sweetner derived from an easily grown plant. It is interesting, because if you don't mind little green specks in your teeth, you could put the dried leaves of the plant in your coffee and you would never know you did not use real sugar.  Obviously, it is better to be able to pour a processed and refined version of the sweetner from a package than it would be to grind up the plant though, right?  Right.  That is what this company is all about.  Growing and processing Stevia to allow consumers the ability to use a much more natural, way less harmful sweetner that tastes like the real thing, but without the calories.  It does not take a rocket scientist to figure out why that is going to spark interest with people, and people are behind those $$$. Just watch, you will start hearing more and more about Stevia, I promise.  It is already on the market.   Also, check the SEC filing dated 1/30/12.  The company has an investor willing to provide equity funding of up to $20,000,000!!  Why would a well-established financial firm take a risk on a company with the financial profile this company has for such a large amount of money if they did not have some reason to think it will be worth it?  Especially right now in the current economy.  Also, if you read all the financials, you would have seen that in spite of the company's revenue of next to nothing, they are on the verge of major expansion.  They have something they are banking on.  They also had a recent change in control over the company.  Maybe this guy isn't as business challenged as the former guy was.  Anyway, check it out for yourself.  It isn't a very high priced stock, but if it is successful, I am going to love to have been smart enough to get in early, who wouldn't?   

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#14) On February 03, 2012 at 5:24 PM, oyoyoy (< 20) wrote:

whoitis12-
I hope you are correct about what consumer's want. I teach nutrition and do recommend Stevia as the best option, for the moment, to use as a sweetener. Sadly, one of the things my teaching has taught me is that, often, people don't act in their own best interest.

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#15) On February 13, 2012 at 9:41 PM, constructive (99.96) wrote:

 whoitis12

Southridge can buy shares at 93% of market price and then dump them.  That's why they're willing to make this finance agreement.

Stevia the sweetener may be wildly successful, but Stevia Corp has no chance.  You are probably not as familiar with small scam companies as many of the rest of us are. My advice is sell immediately, because companies like this always end in tears.

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