Yesterday we covered the incredibly run-up of shares of CD International Enterprises Inc (OTCMKTS:CDII). In the morning the company and their CEO Dr. James Wang broke the news that they had agreed to a $350 million sales contract for 240,000 tons of copper concentrate. Shares shot up a staggering 5000% at one point, all the way to $0.07 a piece before dropping rather swiftly to $0.03 to close the day with a 2250% gain.
Since the market closed yesterday investors have been cautiously optimistic, questioning the legitimacy of this contract. While CD International Enterprises Inc (OTCMKTS:CDII) had stated that they will be raking in millions of dollars a year, they failed to name the buyer of the copper, and also seemingly have diluted the previous share count. According to filings in September there were approximately 85 million shares outstanding. Clearly this is no longer the case as hundreds of millions of shares traded yesterday alone.
Although such a contract would clearly be a game changer for CD International Enterprises Inc (OTCMKTS:CDII), without knowing the total number of shares on the market, it is impossible for any trader or investor to value the company or the possible meaning of such a contract on its share price. Additionally, there has been no SEC filing to go along with this contract, which either indicates that no contract was officially signed, the company is lying and does’t want to dig a deeper hole with the SEC, or they are simply delayed in filing this important information.
Besides these glaringly obvious shortcomings, there is a long history of vague information and sketchy price moves involving this stock, going back years, and the company’s balance sheet certainly doesn’t appear to be one of a company that’s signing $350 million contracts. Below are some of the financials from a recent quarterly filing:
– Company reported a $2.0 million in net loss from continuing operations
– Assets of $23,000 in cash
– Liabilities of $7.2 million
– Revenues last quarter equated to $74,000
We urge investors to tread very carefully here. The stock is currently trading down $0.0076 or 24%.