Insider Financial
MK Automotive Inc (OTCMKTS:MKAU) Is Today’s Penny Stock Focus
By Alex Carlson / in Momentum & Growth, Momentum Stocks, Stocks, Tech / on Thursday, 23 Mar 2017 04:42 AM /
MK Automotive Inc (OTCMKTS:MKAU) has become one of the most talked about names in pennyland. The company has picked up by several newsletters and the iHub pumpers have been out in full force. While we tend to view such developments with skepticism, there’s actually a lot to like about MKAU. When you consider there’s a great story backed up with real developments and a low float, MKAU looks to have runner written all over it.
MKAU got active in February after the company announced the acquisition of Clikia. Clikia is a content delivery company within the rapidly expanding “over-the-top” marketplace, an extremely attractive and active marketplace positioned at the very center of the inevitable, unstoppable merger of two dynamic universes: television and digital video. Clikia’s entertainment streaming packages are flexible enough to satisfy younger consumer groups, as well as the traditional consumer groups who have become comfortable in securing a wide-ranging buffet of programming options from a single provider.
The company aims to capitalize on consumers “cutting the chord.” This is centered around “over-the-top,” or OTT, which refers to the delivery of film and TV content via the Internet, without requiring users to subscribe to a traditional cable or satellite pay-TV service, like Comcast or Time Warner Cable. Clikia will serve also as an Original Content Incubator, where content creators will be able to develop and launch channels, as well as interact with fellow creators. The full-scale system launch is set for March 27, 2017. CEO David Loflin said:
“Thanks to insightful test-user feedback and superior functionality test results on both Apple iOS and Android systems, we are pleased to be able to bring forward our full-system launch date by approximately one month. I want to personally thank all of those who took the time to test Clikia and share their experiences. We expect that the full launch of Clikia will quickly make its mark in the content streaming services segment.”
According to Stratistics MRC, the Global OTT Market accounted for $27.51 billion in 2015 and is expected to reach $85.87 billion by 2022. The CAGR is estimated at 17.6% from 2015 to 2022. Another estimate puts it closer to $62.03 billion by 2020 with an estimated CAGR of 17.2%. During the second quarter of 2016, roughly 812,000 U.S. customers canceled their pay TV subscriptions, according to an estimate from SNL Kagan.
Shortly after launch, Clikia will begin an aggressive marketing campaign, covering all TV markets, including a strong social media marketing program. This is a two part simultaneous launch: Channel and Social Media Broadcasting Platform.
In looking at the capital structure, there are 102,514,672 common shares outstanding. Of that, 51,035,571 is in the float. This makes MKAU a low float play that can get moving rather quickly, especially with its current market cap of just $2 million.
In looking at the company’s financials, at the end of December 2016, MKAU reported ZERO revenues, a net loss of $12k, ZERO cash, and $301k in total liabilities. MKAU will need to raise more capital or convert its long term debut into shares, all of which will dilute existing shareholders.
In looking at the 10Q, it said:
On January 12, 2017 Brian Wendt resigned as President and CEO and David Loflin was named the new President and CEO. On January 20, 2017 Brian Wendt was named the CTO. MK Automotive, Inc agreed to Purchase “CLIKIA” and OTT/Cut the Cord system from David Loflin.
The 30 day avg trading vol for MKAU has been 5m shares daily. With the float being turned over every 10 days or so, we believe there’s still plenty of run room left for MKAU. With its market cap of just $2 million, it won’t take much in terms of dollar volume to push MKAU higher.
