PUMPs & dumpS
Red Flagging DANGERS In The Penny Market
Avatar Ventures (ATAR):
Wash, Rinse, Rip Off The Public Again
What do you do when you've screwed the street so many times with your Pump & Dump campaigns, that everyone recognizes your symbol as a fraud? Why you change that symbol of course! Such is the case with Avatar Ventures (ATAR), formerly of the symbol AVVC. On Monday, this one is starting its 5th Pump & Dump campaign since April 2011.
The symbol change was deemed necessary after the late August failure of a three day effort to foist more worthless stock on the public. The stock went down, almost in a straight line, quickly making losers of as much as 70% of investments.
We told you in an April 2011 advisory, back when this crap started its first P & D, that this company did nothing and judging from the company's own regulatory filings and the way it dishes out news with an eyedropper, it still doesn't do much. We still say that ATAR was designed to be a P & D from the git go, as was evident by the concurrent start of the promos with the beginning of trading in the stock. Let's review.
According to a 10-Q filing on June 20, 2011 on April 30, 2011, the company had $500K in assets including $450K in cash. According to the latest 10-Q, a year later the company has only $70K in assets and 49 bucks in cash. Impressively, ATAR remains consistent in that it still has no revenues. In fact, the company which was established in 2006, has had no revenues ever. Now that's progress with solid management!
The lack of revenues is curious considering the company's announcements of product lines and the supposed opening of three marketing offices over that year. Now is it that the company's products are bad, unneeded, or poorly marketed? Or is it that the announcements are pure BS? Does it matter?
Reviewing the performance of the past Pump & Dump campaigns, we note that the stock was trading in the lofty $1.40 range back in mid April 2011. Several million shares were dumped on a gullible public back then and those shares now have the distinction of trading at a 95% discount. An extended May 2011 reset of the P & D when the stock was already trading at levels 30% below those of a few weeks earlier, did nothing to restore losses and the stock quickly fell another 75% to about 25 cents within 5 weeks. We estimate that insiders dumped just under 10 million shares in the second quarter of 2011, netting themselves a tidy nest egg worth a couple of million dollars.
Things were quiet on the ATAR/AVVC promotion front between the end of May 2011 and the last half of October 2011 and not coincidentally, the company had no announcements to make other than one press release to announce a couple of appointments, including a new Director of Sales and Marketing. With the company still wanting for revenues, we wonder if Deanna Palmer is being rewarded for a job well done.
The promotion and PR machine geared up again in late October 2011, and a few more dollars were plucked form the pockets of a few willing dupes who quickly lost half of their investment.
Except for a 5 day period of fluff press released back in May 2012, the company has had nothing to say between October 2011 and the end of August 2012, when it began its latest failed Pump & Dump. Now we're expecting some more imaginary news to be released before Monday's open to accompany this new Pump & Dump, which is sure to create a slew of new losers. While some P & Ds make for decent day trading fodder, we think that this one could go straight down, even if it gaps at the open.
