ASAB – Pump And Dump Alert – November 1, 2013

| November 1, 2013

Pump and DumpWelcome to Pump and Dump Friday, our weekly feature where we identify potentially “bogus” promotions going on in penny stocks.

Today we’re exposing one of the most extensive penny stock pump and dump campaigns of the week:  Allerayde SAB (OTCQB: ASAB).

If you don’t know how these schemes work, be sure to check out our free report that exposes the whole thing.

Without further ado, here is today’s disaster waiting to happen:

Allerayde SAB (OTCQB: ASAB)

ASAB is one of the most heavily hyped penny stocks of the past week.  According to our sources, 8 promoters with 33 newsletters have been paid more than 500,000 euros to pump the stock.

That adds up to over $700,000 at today’s currency exchange rate.

No question about it, 700 grand is a lot of money to pay to promote the stock of a development-stage company.  But it certainly looks like the promoters are getting their money’s worth. 

Here are a few headlines from the pumpers’ emails hyping ASAB… 

  • “Here Is Our Biggest Pick Of 2013”
  • “Most Massive Pick Of The Year”
  • “2013’s Largest Pick”
  • “Greatest Pick Of 2013”
  • And my favorite… “Success Is Imminent”

You have to admire the inflammatory headlines these guys come up with.  But you certainly don’t have to buy into their self-serving descriptions.  As always, when dealing with penny stock promotions, you have to take everything with a big grain of salt.

So, how’s the campaign working?

Let’s take a look at the stock chart…

Allerayde SAB

As you can see, the stock hardly traded at all prior to September.  Then all of a sudden, it started climbing for no apparent reason.  It jumped from 10 cents to 40 cents and then finally closed at 50 cents on the day prior to the campaign’s launch. 

There was no breaking news that might explain the stock’s abrupt rise.  And there were no company announcements or financial reports issued during this timeframe that would explain a rally in ASAB.


That leaves me to wonder if perhaps the heavy buying in ASAB was by company insiders, family members, friends, and other interested parties.  Could it be that they knew about the upcoming stock promotion campaign and were getting positioned into ASAB ahead of it?

If so, they must be pretty disappointed right about now.

While the shares briefly ticked up to a high of 57 cents on the campaign’s first day, they haven’t taken off like you’d might expect.  In fact, the shares declined to 42 cents on day one, and they dropped to a low of 33 cents on day two.

As I write, ASAB is back up to 45 cents.

Perhaps the stock’s not skyrocketing because investors aren’t impressed with the company’s financials. 

According to the most recent quarterly report (for the period ending June 30, 2013), Allerayde has generated a measly $16,289 in revenue since inception.  The company has a working capital deficit.  It has never produced a profit. 

And more losses are anticipated, “raising substantial doubt about the Company’s ability to continue as a going concern.”

What’s more, Allerayde has produced an accumulated shareholder deficit of over $2.6 million in just 22 months’ time!

I don’t see any reason why anyone would buy this stock right now.  The company’s losing money at a rapid pace.  And according to Allerayde’s own quarterly report, management expects to continue losing money indefinitely.

I wouldn’t be surprised to see this stock plunge in short order.

If you own ASAB, I suggest you get out while you still can.  And if you don’t own these shares, you should really think twice before buying them.

Other Penny Stocks Being Pumped This Week

Trio Resources (OTCQB: TRII) – 23 promoters with 84 newsletters have been paid more than $100,000 this month to hype TRII.

Axxess Pharma (OTCPINK: AXXE) – 19 promoters with 39 newsletters have been paid more than $110,000 in October to plug AXXE.

As you know, penny stocks are a great place to invest your money.  You just have to do your due diligence to stay away from all the schemes and scams out there these days!

Profitably Yours,

Robert Morris

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Category: Pump & Dump Alerts

About the Author ()

Robert Morris is the editor of Penny Stock All Stars, an investment advisory focused on discovering small-cap and micro-cap stocks that are destined to become the market's next Blue Chips. The Wall Street veteran and small-cap stock specialist is also a regular contributor to Penny Stock Research. Every week, Robert shares his thoughts with our readers on a variety of penny stock-related topics.