Sunx Energy: Why This Email Stock Promotion Will End Very Ugly
Summary Multiple websites have been paid to promote Sunx Energy this week. Promoters have a terrible track record. OpeningBellReport owner owns 400 mill shares which he illegally did not disclose in promotional emails. Sunx Energy ( OTCPK:SNXG ) is a name that I believe is currently the target of a penny-stock promotion scheme. It is my view that the stock’s intrinsic value is somewhere near $0, and it is with conviction that I recommend that any investors currently in the name sell the entirety of their stakes immediately. I also believe that Sunx Energy is a stock definitely worth shorting. My track record of identifying and publicly exposing such highly overvalued equities is excellent. Little Revenue. Debts. No Business. Bright Future? As is usually the case with these types of hyped-up scams, it takes only one quick glance at the balance sheet to realize that the $94M market capitalization that this equity commands is beyond ludicrous. With $ 10,000 cash on hand and $275,000 in liabilities you can see that this company is far from deserving a $94m valuation. It’s my suspicion that the purpose of this company is not to succeed but to sell stock. The recent volume is due to an overly bullish promotional email campaign. Chart You can see that trading in Sunx Energy started seeing increased volume on Mar 2, 2015. A simple search in my email inbox and you can see that’s around when I started receiving hundreds of promotional emails from various websites promoting Sunx Energy. Coincidence with the time of emails and increased volume in Sunx Energy? Absolutely not. (click to enlarge) My Inbox (click to enlarge) Disclaimers Now let’s look at some of the disclaimers. 15k compensation to Monster Trading Alerts (click to enlarge) $25k compensation to UnitedPenniesofAmerica.com (click to enlarge) $7.5k Compensation to RDI (click to enlarge) 30k Compensation to BestDamnPennyStocks Sites (click to enlarge) $25k Compensation to Stellar Media (click to enlarge) Reasoning for Stock Promotion Obviously someone is holding a large amount of SNXG free trading shares they are looking to unload. The email promotional campaign has brought in good volume to dump into and I expect them to keep dumping. Illegal Non-Disclosure Michael Forster of OTC Media owns 400M shares of Sunx Energy as per the most recent 10-Q . That’s the owner of OpeningBellReport.com (click to enlarge) As you can see they did not mention their ownership in their promotional email on Sunx Energy which is illegal. This makes Sunx Energy a potential SEC halt candidate. The Law Section 17b, Securities Act of 1933 “It shall be unlawful for any person, by the use of any means or instruments of transportation or communication in interstate commerce or by the use of the mails, to publish, give publicity to, or circulate any notice, circular, advertisement, newspaper, article, letter, investment service, or communication which, though not purporting to offer a security for sale, describes such security for a consideration received or to be received, directly or indirectly, from an issuer, underwriter, or dealer, without fully disclosing the receipt, whether past or prospective, of such consideration and the amount thereof.” (click to enlarge) My Recommendation If you own shares of this company, get out now. Do not hope that you can hang on to sell them to a greater fool. These shares are worthless. I have showed you that the reason for the promotional email campaign indicates that the individuals behind this stock scam are trying desperately to unload their worthless shares onto the unsuspecting public and book a huge profit before the inevitable collapse. If you are a more sophisticated investor and can get a borrow on these shares, then I believe that shorting this name will be highly lucrative for you. This will end horribly just like all stock promotions of this kind. You have been warned. Editor’s Note: This article covers one or more stocks trading at less than $1 per share and/or with less than a $100 million market cap. Please be aware of the risks associated with these stocks. Disclosure: The author is short SNXG. (More…) The author wrote this article themselves, and it expresses their own opinions. The author is not receiving compensation for it (other than from Seeking Alpha). The author has no business relationship with any company whose stock is mentioned in this article.