Xethanol Shares Plummet After Sharesleuth.com Story Appears: Coincidence?

| About: Xethanol Corporation (XNL)

Mark Cuban's Sharesleuth.com has posted its long-awaited first piece, on Xethanol Corp. (XNL). The stock chart since the story appeared is below (and it's not pretty):

As the Sharesleuth story reports:

Xethanol Corp. bills itself as a biotechnology-driven ethanol company that can turn wood chips, corn stalks and paper sludge into cheap alternative fuel.

But a Sharesleuth.com investigation found no evidence that Xethanol has produced significant quantities of ethanol from those raw materials. Combine that with Xethanol's announcement that it'’s poised to become one of the first companies to commercialize that technology - a sort of Holy Grail in the renewable-energy world -– and you'’ve got the type of inconsistency that Sharesleuth seeks to uncover with its stories.

For those of you unfamiliar with Sharesleuth, it purports to provide "independent Web-based reporting aimed at exposing securities fraud and corporate chicanery." As I mentioned previously, I'll be looking forward to seeing what effect Sharesleuth's stories have on the featured companies.

A quick glance at Yahoo! Finance indicates that the stock was down 20% between yesterday and today, with much of the decline coming shortly after Wednesday's opening bell.

XNL 2-day chart:

XNL 2-day

This could be due to people taking Sharesleuth's information seriously, or it could be due to Cuban putting in his short sale this morning (I don't know - I'm just speculating). However, the stock had been steadily dropping for the last few months, so I wouldn't hazard a guess as to which (if either) is the case.

In any event, it'll be fun to watch what happens.

XNL 1-yr chart:

XNL 1-yr chart