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Alan Brochstein, CFA
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Alan Brochstein, CFA has worked in the securities industry since 1986, primarily with the responsibility for managing investments in institutional environments until he founded AB Analytical Services in 2007 in order to provide independent research and consulting to registered investment... More
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  • De Facto Insider James Farinella Of Integrated Capital Partners Appears To Secretly Pump Pazoo While Dumping Shares

    There are now over 300 cannabis-related stocks in the universe that 420 Investor tracks. Most of these companies are not anything more than opportunists, though there are several real companies. Pazoo (OTCPK:PZOO) is a penny stock that jumped in to the frenzy at the top, announcing in early 2014 that it was extending from the human and animal health and wellness business into the burgeoning cannabis testing lab business. Ordinarily, this type of business move should be viewed cynically, but in the case of PZOO, it inked a deal with an entity, MA Associates, with a license with highly respected Steep Hill Labs to open a testing lab in Las Vegas using its name and operating procedures. PZOO now owns 100% of MA Associates, which won a license from the state in November.

    When I launched coverage of PZOO on June 1st, including it in my Focus List, I suggested that it is among the most promotional stocks in the space. indicates that the company has had 560 promotions since going public three years ago, but, to be fair, some of these are traditional I.R. activities. Many, though, are of a more vile nature, like a third-party entity, OT Group, LLC, spending $175K over July 9-10, a time during which the company also engaged Small Cap Voice and Bull In Advantage to help spread the word while it released three separate press releases within 24 hours as the CEO conducted interviews with Money TV and Green Baron as well.

    As I have mentioned, Pazoo faces a serious cash crunch. The company has invested in the buildout of its Nevada lab, but it still isn't open. In fact, according to the CEO as conveyed in the recent conference call, the company still doesn't have a certificate of occupancy three months after its "Grand Opening Party." The debt obligations and lack of revenue are likely driving the promotional activity. Quite simply, if the company is unable to raise sufficient cash over the next few months, it will endure another round of dilution as maturing debt is paid with shares. For those who haven't been watching the explosion in shares, this chart shows the growth over the past year:

    The last reported share-count stands at 728mm as of mid-August, up from 114mm last September, but the SEC filings clearly indicate that it is likely headed much higher. There are several drivers of the higher share-count, including conversions of convertible debt and convertible preferred stock (Series A). The most recent 10-Q details just the change from year-end through 6/30 (an increase from 193mm to 668mm) very clearly:

    (click to enlarge)

    Read the rest of the article:

    Tags: PZOO, Cannabis
    Sep 07 11:28 AM | Link | Comment!
  • Curated Content For Cannabis Investors & Entrepreneurs

    We are getting close to the launch of New Cannabis Ventures, and I am very excited about this new service, which allows those interested in the cannabis industry to view curated content focused solely on the business aspect of the industry. There is no paywall here, and I am confident that we will help our readers who are in the cannabis industry or who are interested in investing in it save time. Hope to see you at!

    Tags: Cannabis
    Aug 17 12:23 AM | Link | Comment!
  • 4 Key Near-Term Issues For $SRNA

    In this video, I review the recent tripling of the price and discuss some of the near-term challenges for the company

    Tags: SRNA, Cannabis
    Aug 09 7:55 PM | Link | Comment!
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