Rocket City (RCAU.pk) crosses the threshold from stock promotion to outright stock fraud.In its two daily releases today, the euphoria over at Rocket City has, in the opinion of Citron Research, taken it beyond the realm of naïve cheerleading and into the world of stock fraud.
In its two daily releases today, the euphoria over at Rocket City has, in the opinion of Citron Research, taken it beyond the realm of naïve cheerleading and into the world of stock fraud.First, in an official company Press Release, it publishes revenue estimates of $150 million –- this from a company that has $465,000 gross revenues in 2006 and scarcely more than $100,000 in the first quarter of 2007 . $150 million is quite an increase in a 2nd year projection – for a company that optimistically projected 2008 revenues of $5.75 million less than one month ago!And all this from a company that has not had the wherewithal to file even a 15(c)211 – the minimum requirement for a marketmaker representation – a filing which, even if it existed, would fall woefully short of disclosure required for investors to make a fair determination of the company’s value. And not just any company … we’re talking about a company with a 10,692 bank overdraft for a cash position as of 12/31/06.Then, adding hype to hyperbole, a marketing firm masquerading as an “Analyst” issues an opinion piece on RCAU trumpeting how “dividends are good”, even though the dividend in question here is merely a partial stock split – which creates as much value as exchanging a dollar for 10 dimes. Its hard to see what “research” is done by “Market Advisors Research” here….other than repeating some of the company’s PR bumph, and fawning over a no-value 10% stock dividend announced by the company, there’s absolutely nothing to justify the $7.25 “price target” they put on the stock.Surveying “Market Advisors” track record on the other pink sheet stocks they’ve published “coverage” of, we find:
GLXI – 16c. (target 80c)
CNTV — .01
SNYY .02c (successor AMSN) (target 5.50)
UCPI .39c (target 1.05 )
RENG .36c (target 3.25)
LYJN .20c (target 1.05)
Clearly this type of research is nothing more than reformatting some empty text provided by the company or its undisclosed major holders.
Why this kind of sham is worthy of the regulatory protection provided by Reg SHO defies explanation.