Hemp Inc (OTCMKTS:HEMP) has now basically given up all of its monumental launchfest from August 2, when HEMP powered nearly 120% over two sessions in response to a press release that we characterized as “jumping the shark” when it was literally repeated a week later. We clearly stated as follows: “one is left with a sense of needing to figure out what is wrong here. Because something must be, or they wouldn’t seem so desperate to impact the share market with the news. Indeed, a quiet version of this release would signal that maybe insiders are still hoping to accumulate and would thus prefer shares stay cheap a bit longer. Instead, the company appears to be trying with all its might to suck in investors. That’s generally not a reassuring feeling.”
Since that time, the stock has cratered. It’s why we always like to take into account the psychological implications of a company’s tone in its press releases. There is often a great deal of game theory involved, and it’s useful to be sensitive to that side of the equation.
Hemp Inc (OTCMKTS:HEMP) was founded in 2008. The company has a reputation as one of the more controversial and scandal-laden enterprises, even by the standards of either the OTC or the cannabis patch, which is certainly painting a picture.
In any case, the company is making strong strides toward reshaping its image as a legitimate emerging leadership play in the industrial hemp space.
Hemp Inc understands its mission to be a provider of “green solutions that help make the world a better place to live. We support products that are eco-friendly, organic, healthy, and solutions that replace many petroleum-based products.”
“Hemp Inc.’s wholly owned subsidiary Industrial Hemp Manufacturing, LLC purchased the largest decortication plant in North America, which is located in Spring Hope, North Carolina. The plant is housed in a 70,000,000 square foot warehouse on 9 acres. The company will start producing fiber, loss circulation materials (LCM) and absorbents from kenaf and later from hemp.”
That narrative continues forward to include the concept that “Hemp, Inc. will produce a product for drilling rigs called “lost circulation material” (LCM), which is used for maintaining the seals when drilling for water, oil, gas, and any other liquid or gas. This product alone is capable of producing millions of dollars in revenue, since some of the largest oil companies in the world will be our primary customers.”
“Eventually, the company will produce fiber materials for the paper and fabric industries, and other industries that utilize materials from hemp to make products such as plastics, building materials, health and beauty related products and more.” In other words, the concept of “diversified applications for hemp as an industrial material” is the paramount idea.
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As noted above, the company has now round-tripped the move off the early August hemp refinery sensationalism, as we suggested may be the case.
The latest from the company is mostly focused on its Hemp University thread of action. This may have some implications for the ultimate upside inherent in the business for shareholders of HEMP shares, but it isn’t easy to see exactly how. For what it’s worth, the company is set to hold its fourth symposium this weekend, which is set to include an installation of a micro market courtesy of One Step Vending, Corp. (OTC PINK: KOSK), which will debut in the symposium to be held in North Carolina on September 30th.
Recent action has seen -6% stripped out of shares during the past week, but that move comes in the context of a larger bearish trend. The situation may be worth watching. HEMP has a history of dramatic rallies. Moreover, the listing has witnessed a pop in interest, as transaction volume levels have recently pushed 12% over the long run average.
Now commanding a market cap of $5.75M, HEMP reports about $469K in reported cash on the books, which is balanced by about $7.5M in debt – most of it booked as long-term obligations. The company has very nominal revenues at this point. You can bet we will update this one again as new information comes into view. Sign-up for continuing coverage on shares of $HEMP stock, as well as other hot stock picks, get our free newsletter today and get our next breakout pick!
Disclosure: We hold no position in $HEMP, either long or short, and we have not been compensated for this article.