(Editors' Note: This article covers a micro-cap stock. Please be aware of the risks associated with these stocks.)
Makism 3D Corp. (OTCQB:MDDD) 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. Yesterday's drop could just be the beginning. I also believe that Makism 3D Corp.is a stock definitely worth shorting. My track record of identifying and publicly exposing such highly overvalued equities is excellent:
Date of Publication
Price at Publication
42% (early in pump, will end up lower)
.05 (Got Halted by SEC after my report)
63% (early in pump, will end up lower)
$0.15 (did hit $25 in an incredible short squeeze)
Makism 3D Corp. is a 3D printer manufacturer based in Cambridge, United Kingdom. Its mission is to design and build efficient, reliable and attractive consumer and professional grade 3D printers. The Company believes there is enormous scope for innovation within the design, usability, and engineering of 3D printers, and has identified a valuable new market segment located between the low cost professional market and the high-end consumer market. Find out more at here.
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 $75M market capitalization that this equity commands is beyond ludicrous. With $320 in total current assets and $45,459 in current liabilities in recent quarter is clear they are not going in the right direction. They have had 0 revenue. They really can't keep operating like they are and it is my suspicion that the purpose of this company is not to succeed but to sell stock. The recent volume is due to overly bullish promotional mailers being delivered to people's homes.
Makism 3D Corp.follows the typical pattern most shells do that end up getting promoted.
#1) Business taken public with no revenues.
#2) Seed shareholders given shares for next to nothing
#3) Change in control
#4) Name and symbol change
#5) Forward split while all the shares were insider owned Makism 3D Corp.
After going through all the filings you come to the conclusion there is about 20,000,000 free trading shares in the seed shareholders hands.
Most companies that end up being promoted usually tend to have little to no trading history. Makism 3D Corp.is the same. Those seed shareholders cannot turn their shares into cash unless there are buyers. This is where they turn to stock promoters. Stock promoters get paid to send out overly bullish professional type mailers/emails to retail investors to lure them in. Let me show you what I mean:
Picture of MDDD chart
You can see that trading in Makism 3D Corp.really started trading big volume on December 2, 2013. Michael Goode blogged about a Makism 3D Corp.email that was being sent out with 150k budget. The emails linked to a landing page with a bullish mailer of Makism 3D Corp. with a disclosed budget of 2.75 million. Coincidence? Absolutely not.
"Blackrock Media Group Inc., (BMG) has received a total of $2,750,000 USD as of November 30th, 2013 from its client Edge Strategies, LLC., the third party advertiser for this advertising in an effort to build investor awareness for Makism 3D Corp. (OTCQB: OTCPK:MDDD)."
You can see obviously someone is interested in increasing public awareness for Makism 3D Corp. Most likely those seed shareholders with about 20 million free trading shares (who knows who owns what). Why else would someone spend $2,750,000 to increase public awareness? It is worth it to them because if they can bring in buyers and liquidate their shares around these prices that can mean about $25 million in profits! Running pump and dump schemes is a lucrative business and that is why we see it way to often. My job is to wake you up!
Paragon Report Past Promotion
This stock promotion group sends out emails and hard mailers together throughout the promotion. Here are their 2 latest promotion campaigns.
Disclosed Budget: 2,926,000
Hard Mailer From: Ian Cooper
Shares Outstanding: 59,145,237
Promotion High: $1.36
Market Capitalization at High: $81,028,974.00
Percent Drop: 91%
Disclosed Budget: 3,000,000
Hard Mailer From: Chuck Hughes
Shares Outstanding: 86,978,019
Promotion High: $3.61
Market Capitalization at High: $313,990,648.00
Percent Drop: 93%
Recent SEC Halts
SEC is finally cracking down on pump and dumps lately. Here is a list of big stock promotions that have been halted recently. I believe Makism 3D Corp. has a chance to be next. Stocks that get halted tend to reopen 2 weeks later down 70%+
- Guar Global Ltd.(OTC:GGBL) halted December 6, 2013.
- Neveda Gold Corp (OTC:NVGC) halted November 27, 2013
- Life Stem Genetics Inc (OTC:LIFS) halted November 25, 2013
- Sovereign Lithium (OTC:SLCO) halted November 15, 2013
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 mailers 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. In this stage of the promotion with the stock halt risk it is not worth staying long overnight to make .05-.10 more in gains when there is a risk of 70% in losses. I short these penny stocks promotions for a living. They are the same patterns over and over again. They are very predictable. I verify all my trades here. I learned my trading strategy from this guro here.
I contacted the company with my concerns I am waiting to hear back.
Disclosure: I am short OTCPK:MDDD. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.