WordPress database error: [Disk full (/tmp/#sql_485c_0.MAI); waiting for someone to free some space... (errno: 28 "No space left on device")]
SELECT t.*, tt.* FROM vw_terms AS t INNER JOIN vw_term_taxonomy AS tt ON t.term_id = tt.term_id INNER JOIN vw_term_relationships AS tr ON tr.term_taxonomy_id = tt.term_taxonomy_id WHERE tt.taxonomy IN ('category') AND tr.object_id IN (365478) ORDER BY t.name ASC
CYNK Technology Corp (OTCMKTS:CYNK) has Wall Street in a quandary. What is this company and where did it come from? Why did investors start snapping it up like it was going outta style? This is the great mystery of the week, but it looks like investors might finally be coming back down to Earth after all the bad press about it.
Oh yeah, and shares of the fishy company have been halted in premarket trading this morning.
CYNK Technology spiked a year ago too
Forbes contributor Tim Worstall notes that it doesn’t look like CYNK Technology Corp (OTCMKTS:CYNK) has done much of anything in recent years. It has spent most of its life as a penny stock, one that trades at less than $5 a share, isn’t listed on a national exchange, and doesn’t meet certain criteria.
One thing I noticed that’s interesting about this is that this isn’t the first time the company’s stock has spiked ridiculously high before plummeting back down to earth. The same thing happened on July 11, 2013—yes, exactly a year ago from today. At that time, the stock hit $20 per share. Then it plummeted on July 16, 2013. And on July 26, 2013, the company announced via an 8K filing that it was changing its name from Introbuzz, Inc. to CYNK Technology Corp and did a 75 for 1 forward stock split effective on July 15, 2013. And then what’s strange is that later in the same paragraph, the forward stock split is referred to as 1 for 75. That seems like a pretty strange typo to make in such an important document.
Was the spike in stock price triggered by someone who knew this was going to happen? Regulators will probably want to find out the answer to this question. And then there’s the fact that sometimes companies do forward stock splits in an attempt to increase demand for their stock.
This year at CYNK Technology
Fast forward to this year, when the company announced in a press release on June 27 that it had upgraded its server and website “to adequately handle the anticipated flow of visits in the upcoming months.” It’s a very cryptic message that doesn’t explain why it believes there will be so many more visits to its website soon.
Worstall notes that this looks like a classic pump and dump scheme. To kick off this type of scheme, someone usually buys enough shares to attract the attention of momentum-focused traders, who then snap up shares furiously, driving the price up and up without rhyme or reason. Of course there is no evidence to say that it is, but the sudden, outrageous rise in stock price made regulators sit up and take notice. After hitting a valuation of $6 billion, it was reported on Thursday that regulators might shut the company down. They’re probably investigating to see whether there was any ill intent involved.
What’s wrong with CYNK?
The big problem with CYNK Technology Corp (OTCMKTS:CYNK) is that it appears to have assets worth only about $39, according to TechCrunch, just a single employee, and a website that doesn’t get a lot of traffic. The company has continued to post losses, has no income, and has racked up more than $51,000 in liabilities. Also on March 31, CYNK filed with the Securities and Exchange Commission to state that it wouldn’t be able to file its annual report. The company has also filed to suspend its duty to file regular financial reports.
And yet, this company’s valuation surpassed that of Groupon Inc (NASDAQ:GRPN), which while it is struggling, has assets worth more than $39. A lawyer for the company recently prepared a letter stating that CYNK Technology’s only officer, Javier Romero, holds 210 million shares, and the company has only 291 million outstanding shares.
What’s happening at CYNK?
This week CYNK Technology Corp (OTCMKTS:CYNK) seems to have paid someone to promote to promote its stock, and as Worstall notes, this sort of situation gets tricky. Sometimes paying a promoter to push a stock can be innocent, but other times, someone does it with the motive of selling out right after the stock price skyrockets. This is probably why regulators are so interested. They want to uncover the motive behind the stock promotion.
So what does CYNK offer? As it turns out, it’s a social network, but there isn’t much to it. The company’s website is www.introbiz.com, for those who want to check it out.