In the world of penny stocks, you’re sure to find oodles of great, unknown companies to invest in. But there are also penny stock scams designed to bilk hard-earned cash from investors. And usually you’ll know its hit you after you’ve watched your investment evaporate into thin air!
We know what to look for, and tell you who’s out there pumping stocks using paid promoters.
It’s our job to expose penny stock pump and dump scams…
And we take real pleasure in putting the smackdown on the latest penny stock pump and dump scams.
As you read, you’ll see the big red flags we’ve come across on these companies. And with all the great penny stocks out there… there’s no reason to put a single dime into any of these companies!
This week, we’re exposing a pump and dump scams on: Zinco Do Brasil (ZNBR)
It seems all too easy to pick on the penny stock miners- at least the ones being pumped! They want your cash, but I hope you read this and avoid buying the BS being run by the pump n’ dump emailers!
Red Flag #1: Paid PUMP!
Penny Stock Explosion is just one of the pumpers getting paid to promote this stock. For just a 2-day pump, they were paid $1,500. Sure, that’s not as much as some we’ve seen, but certainly an easy payday for those guys.
If there were promoting a really compelling stock with a great argument I might see believing what they’re saying. But the fact is the company in question, ZNBR, is far from investment grade quality!
Red Flag #2: Pumpers Story Is Weak
The pumper, Penny Stock Explosion, is in my book not too bright. They’re calling Zinco Do Brazil a “Ticking Time Bomb”…
Really, that’s the best line you’ve got?
But I have to agree with them in one aspect… ZNBR IS A TICKING TIME BOMB- for any sheep sucked into this crappy stock. Buying this stock is almost certain to blow up in your face!
The pumper talks up the company’s new CEO that took some former “ghost” mining company from $X million $X billion in market cap. But who cares really… just looking at those financials- they’re enough to make me sick!
Red Flag #3 Train wreck Financials!
Anyone putting a dime into this company is either insane, or knows nothing about financial analysis.
Take a peek at these numbers as of November 30, 2013:
- $0 cash on the books
- $4.5 million in liabilities
- Accumulated deficit of $46 million
- Quarterly income = $0
- Net loss of $37,000
The company did post a gain on derivatives in the quarter referenced above, but that’s just a one-time gain, which has nothing to do with the sale of any zinc or other mined materials.
Basically, ignore the one-off gain, and understand unless this company can start pulling zinc out of the ground and selling it- they’re not likely to continue as a going concern!
Even their accountants doubt they’ll make it much longer… see what they had to say in the report
As shown in the accompanying consolidated financial statements, the Company had a net loss of $285,887 for the three months ended August 31, 2013 and had a working capital deficit as of August 31, 2013 of $4,840,846. These conditions raise substantial doubt about the Company’s ability to continue as a going concern.”
The Wrap Up:
Too many investors get sucked into these nightmare penny stocks scams. They fall for the overly optimistic projections the paid promoters are selling. In the search of easy money, investors lose sight of what a real return should be… and end up holding the bag.
When investing in pumped penny stocks, it’s the ultimate case of “let the buyer beware!”