Melissa Davis, senior editor of The Street Sweeper, poses with celebrity stock picker Jim Cramer after a recent taping of his "Mad Money" television show. Davis worked as an investigative reporter for TheStreet.com, where Cramer serves as chairman, before assuming her current role at The Street Sweeper.
Ocean Power Technologies (OPTT): Wave Goodbye To This Wave Power Company
by Sonya Colberg, Senior Investigative Reporter, 4/3/2014 10:07:29 AM
Ocean Power Technologies (Nasdaq: OPTT) might blow its rivals out of the water – if only it could deliver projects like it delivers regurgitated news.
OPTT stock was swimming with the bottom feeders when the company announced a multimillion-dollar Australian deal in January with the following deceptive headline:
Bam! Shares jumped with the announcement by 52.9 percent in premarket trading to $3.38.
But here’s the deal: OPTT had already announced the grant - five years ago. Here is that headline:
The January press release actually announced Aussie funding from the original grant would be available for phase one and two, plus OPTT would now have to meet more milestones. So this carefully crafted news release isn’t really surprising, positive news at all. The market - eager for a hint of good news - took off and ran with it.
“Fool the investors” works this week, too
Buoyed by previous misleading regurgitated announcements, OPTT tried it again Tuesday.
This time, the regurgitated gem reads:
Many people mistook the announcement to mean that OPTT was getting a fresh batch of funding. The sound of the Australia project apparently finally running toward its power-wave goal - combined with the sound of investors pushing the “buy” function - was truly deafening.
The stock price exploded almost 9 percent to $4.06.
What was wrong with this announcement? First, the $4.6 million (US dollars) grant was already assumed because execs in March said, Australia, with conditions attached, would fund part of the first phase.
This is not new. And it is not new funding. In fact, the release states that grant revenue will be accounted for later, indicating OPTT doesn’t dare count it now because the company is unlikely to come up with the required matching money.
Second, the misleading headline ignores the real news that OPTT is legally required to disclose in its 8-K, US Securities and Exchange Commission filing. That real news is that the Oregon project is officially Dead Sea debris.
The US Department of Energy has terminated the remaining teeny, single-buoy contract with OPTT because the company couldn’t come up with enough money.
Key wording in the new SEC filing is: “The Company and the DOE are discussing the steps necessary to close out the project.”
OPTT’s bad habit of regurgitating “news” is just another surface wave in a growing tsunami of issues surrounding the company that has been trying since 1994 to turn electricity-generating ocean wave power into a real business.
MiMedx (MDXG): Not What The Doctor Ordered
by Sonya Colberg, Senior Investigative Reporter, 3/21/2014 9:40:54 AM
Human placenta products peddler MiMedx (Nasdaq: MDXG) is handing out company stock like candy to doctors who “evaluate technologies” or act as consultants, TheStreetSweeper has learned.
The company has doled out roughly 1.2 million shares of stock and options to its influential doctor friends – shares now worth more than $7 million – as its chief executive, Parker Petit, prepares to go on trial perhaps as early as next month for an alleged insider trading scheme.
Despite that, the company stock price is screaming, shoving the market cap into the stratosphere. The company is now valued at about $740 million, much higher than the entire “skin substitution” market estimated at $500 million.
Paid to do what?
MiMedx uses doctors in speaking bureaus, consulting and research. But filings also say doctors educate others about “the efficacy and uses of our products.” MiMedx’s business turns mothers’ placental membranes into “EpiFix” material used to cover injuries such as burns and diabetic foot sores, as well as “AmnioFix” for internal coverage uses such as spinal surgery and tennis elbow.
The company’s filings – pages 14 and 15 – describe some doctors’ duties this way:
“… speaking to payers about our products in support of our reimbursement efforts.”
The company also works with doctors “who may order our products or make decisions to use them,” according to this filing.
TheStreetSweeper asked the company for more details about the medical advisory board, including whether MiMedx encourages doctors to use their products. We got some answers back by email.
“Our selection of advisory board members is unrelated to their use of our products,” said the company’s lawyer, Roberta McCaw.
MiMedx uses doctors to help deliver exciting business deals while it tiptoes past kickback and false claims laws, suggests page 28 of this filing. But news reports show even big pharma sometimes fall down the slippery slope into an embarrassing, expensive legal hole that MiMedx could ill afford.
Just last November, Johnson & Johnson agreed to a $2.2 billion deal to settle government charges on false marketing claims and paying kickbacks to doctors.
Doctors get cheap stock
For investors, there’s also a personal piece to the problems inherent in MiMedx’s fraud lawsuit-saddled chief executive’s use of the medical advisory board.
Unlike the average investor, some lucky doctors have had the option to buy their stock for mere pennies-on-the-dollar. These doctors also get paid on a services rendered basis, though the company lawyer wouldn’t give details.
JAMN Finally Spills the Beans -- And It's an Ugly Mess
by Janice Shell, 6/2/2011 10:32:51 AM
To be sure, the 10-K offered investors little reason to sing. For starters, the filing reveals, this once-hot “coffee company” sells no coffee of its own at all. JAMN relies on a supplier based in frigid Canada – far away from the tropical Jamaican home of its co-founder Rohan Marley – to provide the company with an actual product to sell to its customers instead.
Back in April of 2010, JAMN inked a “supply and toll agreement” with Canterbury Coffee of British Columbia that gave it access to some brew. According to that agreement, JAMN relies on Canterbury to fulfill every role – save a minor one – normally satisfied by a firm that classifies itself as a coffee company. Canterbury purchases the coffee beans. It roasts them. And it then packages them in bags supplied by JAMN – the company’s only real product – for sale to the public.
JAMN signed this deal more than a year ago, right before Shane Whittle – a notorious Vancouver stock promoter – officially resigned as CEO of the company. But the company never mentioned that agreement, seemingly material enough to warrant at least a quiet 8-K report, in a single regulatory filing until now.
Jammin Java (JAMN): Hot Stock ... Bitter Aftertaste?
by Janice Shell, 6/2/2011 10:30:25 AM
It’s time to wake up and smell the coffee! That’s exactly what Jammin Java (OTC: JAMN.OB), a heavily promotedcoffee company, and – for very different reasons – TheStreetSweeper would like investors to do.
Since the beginning of the year, JAMN has miraculously risen from the ashes of the “Grey Market” graveyard to become one of the liveliest – and richest – stocks in the entire microcap arena. JAMN has seen its stock shoot straight toward heaven, soaring from 55 cents to peak above $6 a share on massive daily volume, with its market value nowtopping $355 million despite the company’s limited resources and operating history. (As covered in more detail below, two of the Internet tout sheets pushing JAMN the hardest effectively vanished -- disabled by their Internet servers -- on the day the stock’s trading volume exploded past 20 million shares.)
CCME: Few Signs of Life at 'Healthy' Chinese Firm
by Roddy Boyd, 3/23/2011 9:30:34 AM
Also, and this cannot be understated, hanging out on a sidewalk in Fujian–the sidewalks double as parking spots when the streets, which appeared to have been designed in the Han Dynasty, fill up–was not a viable option. There was also the matter of the world-class headache the Financial Investigator was developing from Fuzhou’s diabolical smell, an epic conflation of poor sewage treatment, air pollution and the smell of cabbage that made getting the hell off Dongjie street a matter of vital importance.
The Financial Investigator and his traveling companion for the trip, an American investor with extensive experience in China, decided to head upstairs despite our interview with the CFO having been cancelled at the last minute (with no explanation given.) We thought a quick tour of the offices and meeting a few other executives might open our eyes to a few things.
Though the language barrier was a little steep with the young receptionist–when we asked for writing paper, she provided Kleenex–we were in short order shown to their conference room and told to wait. It did not escape notice that pride of place in the conference room belonged to a framed certificate of participation from the Fall 2010 Rodman & Renshaw conference, the World Cup for reverse merger companies and the pumpers and touts who peddle them.
Eventually chief operating officer James Yu came down and after spending 30 minutes trying to understand who we were, concluded that giving us a tour wouldn’t hurt. Soon enough, his colleague, Vinne Ye–the chairman’s assistant–came out and took us around.
It was most eye-opening.more...
CNBC on TheStreetSweeper's coverage of Miller Energy Resources: (MILL):
"Melissa Davis at TheStreetSweeper … wrote a piece on this thing that obviously scared investors a little bit … It was an excellent reporting job (and) has moved the stock dramatically."
Watch the Video
Read the MILL Story
Investors must be properly armed in order to protect themselves against the dangers of Wall Street. To help out, The Street Sweeper has mined the Internet for the most powerful weapons available to investors researching publicly traded companies. In our “Loaded Weapons” section, you’ll find direct links to corporate documents filed with the SEC, conference call transcripts published by Seeking Alpha, insider stock sales tracked by Insider-Monitor.com and popular investment tools offered by Yahoo! Finance. You can also identify the promoters behind current penny stock campaigns – and the compensation they are receiving – by connecting to StockPromoters.com. You can link to other websites that are conducting topnotch stock investigations as well. Click here now.