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Should We Trust Cool Holdings ?

|About: Cool Holdings Inc. (AWSM)

Summary

The stock has been propelled by exaggerated and misleading articles that Cool paid $415,000 to promoters to create and disseminate.

Now, incorrect information is out about Cool’s price target (which doesn’t even exist) plus institutional interest. Both are critical measures used to determine whether to buy or sell a stock.

If Cool is not complicit in developing and signing off on bogus information, it must step up, tell investors what’s going on and demand that newsletters cease-and-desist from spreading misinformation.

This is the fourth installment in TheStreetSweeper's ongoing investigative series on Cool.

Should investors trust Cool Holdings (AWSM)?

The phone re-seller’s stock has been propelled by exaggerated and misleading articles that Cool paid $415,000 to promoters to create and disseminate. While Cool is supposed to disclose promotional payments, we were only able to find disclosures in promoters’ materials.

But now, new promotional problems seem to be fooling investors.

Incorrect information is going around about Cool’s price target (which actually doesn’t even exist) and its institutional interest. Both are critical measures investors commonly use to determine whether to buy or sell a stock.

TheStreetSweeper is calling for the newsletters to correct this false information. And if it isn’t complicit, Cool should step up and demand that the newsletters cease-and-desist.

Analystsbuzz.com, thewelesleysnews.com and bitcoinpriceupdate have posted the misleading information.

Other sites posting the wrong information include standardoracle.com, postanalyst.com, gvtimes.com and theriponadvance.com.

*Price Target: Doesn’t Even Exist

One promotional article was recently distributed by analystsbuzz here. Last Friday, September 28, another flattering article containing similar information appeared on thewellesleysnews.com here.

The analystsbuzz headline reads: “Cool Holdings (AWSM) to strike $35 in short term period.”

The article states:

“Price Target Estimate:

“Analysts expected the average price target of $35 that is probable to reach in coming one year period.”

Another site, bitcoinpriceupdate, repeats the same erroneous target … and even adds details that imply there are several analysts and a consensus target. The post also gives the wrong gross margins, stating 12% versus the actual 10.6% reported by Cool:

“For the next one year period, the average of individual price target estimates referred by covering sell-side analysts is $35.”

Reputable financial sites Bloomberg, Nasdaq and Yahoo Finance show absolutely NO ANALYST coverage of $AWSM.

Here’s Bloomberg (ANR is the analyst rating function), showing no analysts:

Here’s Yahoo:

Here’s Finviz, a less-popular site used as reference by a couple sites. Finviz shows a $35 price target yet inexplicably does not back up that target with analysts or their recommendations:

Here’s Nasdaq:

Investors are likely mistakenly buying the stock in the belief that an analyst - or group of analysts - think the stock could rise.

But there’s no acknowledged analyst coverage of Cool. So, there’s NO Price Target.

*Critical Question

There’s a big question surrounding the price target that Cool needs to answer.

Where did the non-existent price target come from?

Did Cool approve of the fake target?

*Institutional Interest: Almost Zero

Meanwhile, Analystsbuzz.com and thewellesleysnews.com are among the sites that state Cool has an institutional ownership of 5.5%.

But according to the gold standard – Nasdaq - Cool’s institutional ownership is just 00.29%.

(Source: Nasdaq)

Digging through Cool’s filings shows there are no recognizable institutional owners. Caravel CAD is a Bahamas-based owner that has been selling shares of Cool lately. In August, Caravel sold off 75,000 shares at $3.70-$3.84.