Marijuana Company Of America Inc (OTCMKTS:MCOA) is a penny stock in the cannabis space that has been powering higher and drawing huge attention from OTC traders in recent days. The company announced this week that it has engaged L&L CPAs, PA as its independent audit firm to complete a two-year audit of the Company’s financial statements as part of the process of preparing to become a fully reporting public company with the intent of uplisting to a higher reporting exchange.
According to Tuesday’s release, “the newly engaged auditors are working together with the Company’s legal counsel to complete the necessary procedures to file a registration statement with the Securities and Exchange Commission. When completed and filed with the Commission, this will represent a significant step toward our efforts to enhance long-term shareholder value, while attracting a broader and more diverse shareholder base.”
Marijuana Company Of America Inc (OTCMKTS:MCOA) trumpets itself as a marijuana marketing and distribution company. It intends to distribute a range of marijuana, CBD, and related products in the United States and internationally.
The company was formerly known as Converge Global, Inc. and changed its name to Marijuana Company of America, Inc. in December 2015. Marijuana Company of America, Inc. was founded in 1985 and is headquartered in Bonsall, California.
According to the Company’s press materials, “MCOA plans to distribute marijuana and products related to marijuana as well as CBD and hemp, using a variety of marketing approaches to distributing on a global basis.”
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As discussed at the outset, the company has engaged an independent audit firm to complete a two-year audit of the Company’s financial statements as part of the process of preparing to become a fully reporting public company with the intent of uplisting to a higher reporting exchange. That’s not an immediate catalyst, per se, but the market is taking it as a fine opportunity to clamp the plyers tight around the tube on the shorts.
“Our goal is to be a fully transparent reporting public company,” said the Company’s CEO, Donald Steinberg. “As we grow and take these major steps, we want our shareholders to be well-informed about our plans and our progress. By becoming a fully-reporting, transparent public company, we may be better positioned to enhance stock liquidity and attract institutional investors, which will fundamentally enhance the value of our Company.” Once the audit is completed over the next several months, the Company will have a better idea which stock exchange is most appropriate for the Company.
“Our goal is to be fully reporting on the most reputable exchange we qualify for, so our shareholders have all the information they need to follow our progress in detail,” said Mr. Steinberg.
From what we have gleaned, L&L is registered and experienced in conducting audits of public companies in the cannabis industry.
The press release continues, “Completing this audit will help ensure the accuracy and completeness of the Company’s financial information, and also help to identify and strengthen internal controls over financial reporting.”
As noted, this really isn’t a near-term catalyst. It’s more of an example of the state of the market right now. As we run into year end, people want to own these stocks, and bear funds do not want to show short interest to investors. That’s a combustible mix.
We’ve witnessed 68% tacked on to share pricing for the name in the past week. The situation may be worth watching. MCOA has a track record that includes a number of dramatic bounces. Furthermore, the stock has benefitted from a jump in recent trading volume to the tune of 17% above its longer run average levels.
Earning a current market cap value of $107.9M, MCOA has a significant war chest ($266.17k) of cash on the books, which compares with about $108K in total current liabilities. One should also note that debt has been growing over recent quarters. The company is pre-revenue at this point. This is an exciting story, and we look forward to a follow-up chapter as events transpire. For continuing coverage on shares of $MCOA stock, as well as our other hot stock picks, sign up for our free newsletter today and get our next hot stock pick!