Chris Byron- NY Post on DIO
DIO trading near 8
"Exactly what this Massachusetts-based biotech company does is hard to say, except perhaps, if one reads the financials, that it seems to involve the sale of "clinical modalities in micro-invasive medical procedures."
In any case, there's apparently not a whole lot of demand for them at the moment because, if you read the company's financials, it turns out that DioMed had sales of less than $10 million last year.
NOR does it seem that the micro-invasive modality game is what you'd call a license to print money, no matter how many you sell. DioMed's financials show that the company took in revenues of roughly $30 million in the last four years, while spending $50 million simply to get it.
As for the folks at DioMed who are calling the shots in all this, well, one of them turns out to be a Canadian-based stock promoter who has a large cache of the company's stock tucked safely away in the Cayman Islands.
One of the board members is a Briton who got sanctioned in the Barings Bank swindle and has been barred from serving on the board of a public company in the U.K"
"DioMed is exactly the sort of stock that should send any normal person fleeing the room at the mere mention of its name: suspect auditor, offshore accounts, weird product, teeny-weeny revenues, board members with back-stories - this stock's got it all, the complete package.
YET in spite of all that, DioMed's share price has actually soared 2,800 percent on the Amex - from 25 cents to more than $7 - in just the last eight weeks, by far the greatest gain of any listed stock on Wall Street this year. "
"This company began life in 1998 as a Canadian penny stock, incorporated in Nevada under the name Natexco Corp., and supposedly in the business of providing advertising services to other itty-bitty companies like Natexco, which was run out of the founder's house in Vancouver.
As of last November, when Natexco filed its final quarterly financial statement before morphing into DioMed, the company's balance sheet showed a grand total of $64 in cash, $10,298 of total assets, and $2,357 of quarterly revenues.
In fact, the only real asset Natexco had were its shares, which became shares in DioMed when Natexco was merged last month into a privately owned British company named DioMed, Ltd. that happened to be in the aforementioned micro-invasive modality business. In the merger, 29 million shares of DioMed were created, with roughly half going to the old Natexco owners and half to the British crowd. "
"Ajmal Khan, who works the penny stock circuit under the moniker Verus International, has good and legitimate reasons for holding 4.4 million shares of DioMed in a Post Office box in the Cayman Islands, as appears to be the case through a footnote in a recent DioMed financial filing.
Certainly Mr. Khan has had plenty of experience in this general area, since a search of recent Amex listings shows him as a board member of four separate companies that arrived on the Amex via the reverse merger route - each of which soared and then plummeted.
What I can't quite figure out though, is why it's not possible to track down another fellow named Mohamed Patel, who appears to have paid $50,000 to a web newsletter named TGR, LLC, to crank out stock hyping recommendations on DioMed for the next year.
The Web site distributing the current of these reports - the so-called Smallcap Network - carries a fine-print disclaimer describing Mr. Patel vaguely as an "individual," which presumably means he wasn't acting for Mr. Khan and his Verus International outfit. "
nypost.com
dio feb 14 filing points out 5m shares sold at 2 |
