There's little doubt traders have seen incredible strength from certain stocks today, and have become interested as a result. Before taking the plunge though, those same traders should know that strength could be artificially induced by stock promoters. In fact, Sun Tzu, Corp. (STZU.PK), Xcellink International Inc. (XCEL.OB), Blink Logic Inc. (BLKL.OB), and Virtualhealth Technologies, Inc. (VHGI.OB) are among today's most likely candidates for stock-pumping gains. Be warned; here's a closer look at what's real and what's not.
The U-shaped reversal from the
Sun Tzu, Corp. (
STZU) chart would be an ideal rebound move were it not for one thing.... this morning's gap. Between the promoters and the good news, STZU has made a modestly-intimidating move.
The announcement was simply that Sun Tzu's energy drink would now be distributed in Russia and Eastern Europe. The news followed a similar press release from last week regarding Latin America. The Russia/Europe market is expected to generate between $2 million and $5 million in sales annually. That's not bad for a company that reportedly did only $149K in sales over the last twelve months.
The upside for STZU owners? A small float and strong management. The downside of owning STZU? It's a pink sheet stock, so all statements should be taken with a grain of salt.... and, the growth the company expects may be wildly optimistic.
Yes, it's a relative upstart, but from $149K to a few million? Give the market a plausible reason why or how.
It may be good for a short-term trade thanks to a well-oiled promoting effort, but the company's got a lot to do to be a compelling investment.
There's no chart for
Xcellink International Inc. (
XCEL), because there's no amount of meaningful history for the stock. The company's made up for lost time though, with an excessive amount of news.... some meaningful, some not.
The important items are the acquisitions of key customer payment system patents for mobile devices that Xcelllink will further develop and monetize (U.S. Patent # 7024385 titled 'Automated Electronic Funds Transfer System and Method'), and the announcement that the mobile-payment market is expected to be worth $800 billion by 2013. That's a lot of growth.
The idea is great, and the technology is real. However, Xcellink may be overestimating their penetration and ability to turn a technology into revenue. This is one traders may want to steer clear of, as details and plausible plans seem to be lacking.
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Despite
Blink Logic Inc. (
BLKL) not following it up with any news today, there was some decent news from Friday that pumpers latched onto.... VistaComm chose Blink Logic's 'software as a service' solution for their AG Retailer Information System (ARIS).
It was the first the market has heard from the SAAS provider since July, which certainly didn't help the stock - it's been sliding lower since March of last year. Though the news was definitely positive, it may be too little right now to get the stock jump-started (particularly after this morning's gap).
Bottom line? BLKL is worth putting on watchlists, but not yet worth trading - the chart needs to firm up quite a bit. A little more good news will help.
Though the news may have been only modestly meaningful, at least
Virtualhealth Technologies, Inc. (
VHGI) had some. Virtualhealth has received $100,000 from Private Access Inc. as part of a restructured loan payment; the total loan amount is worth $1.5 million.
No big deal - it's just good that the company is able to make a little money and actually collect it.
That said, short-term traders should be interested in the fact that VHGI has pulled out of its funk. Simultaneously, long-term investors should know that Virtualhealth Technologies should know that the company does exactly what President Obama has all but mandated - they computerize/digitalize medical health records. It's a $29 billion piece of pie (annually) up for grabs.
Lots of competition exists, like Emdeon and Eclipsys, but it's a real opportunity.
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