Cogentix Medical, Inc. (NASDAQ:CGNT)

After years of investing in real life and pitching on Caps, I’m very sorry, but this is the EXACT kind of company that I have absolutely no faith in. It didn’t take me long to come to this conclusion but I do encourage you to read their SEC filings on your own. I didn’t have to get very deep in their 10-Q before finding this:

“The Company is the result of the Merger effective as of March 31, 2015 (the "effective date") of two medical device companies, Uroplasty, Inc. and Vision-Sciences, Inc. On the effective date of the Merger, the two companies completed an all-stock merger, pursuant to which UPI merged with and into Merger Sub. Merger Sub was the surviving company from the Merger, and changed its name to Uroplasty, LLC. After the merger, VSCI and its consolidated subsidiaries, including Uroplasty LLC, and its subsidiaries, operate under the name Cogentix Medical, Inc.

Upon closing of the Merger, the former UPI stockholders owned approximately 62.5% and the VSCI shareholders retained approximately 37.5% of the company. Accordingly, while VSCI was the legal acquirer and issued its shares in the Merger, UPI is the acquiring company in the Merger for accounting purposes and the Merger has been accounted for as a reverse acquisition under the acquisition method of accounting for business combinations. As a result, the financial statements of the Company prior to the effective date of the Merger are the historical financial statements of UPI, whereas the financial statements of the Company after the effective date of the Merger reflect the results of the operations of UPI and VSCI on a combined basis. See additional disclosure provided in note 2. We have prepared our Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q, without audit, pursuant to the rules and regulations of the Securities and Exchange Commission. Certain information and footnote disclosures normally included in the consolidated financial statements prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP, have been condensed or omitted, pursuant to such rules and regulations, although we believe that our disclosures are adequate to make the information not misleading. The consolidated results of operations for any interim period are not necessarily indicative of results for a full fiscal year. These Condensed Consolidated Financial Statements, presented herein, should be read in conjunction with the audited consolidated financial statements and related notes included in our annual report on Form 10-K for the fiscal year ended March 31, 2015.”

There is some funky stuff in the financials as well, but I didn’t feel it necessary to investigate what they were doing. So reverse merger, previous businesses, never profitable, burning cash like crazy, lots of stock issuance. This one is quite easy, in my opinion.

They've got something needed and priced at good value.