MENTOR CAPITAL INC COM NPV (OTCMKTS:MNTR) is a penny stock that has grabbed hold of the attention of traders during the stock’s recent bounce. The recent catalyst is the company’s announcement that the federal District Court for the Northern District of California has confirmed Mentor Capital’s arbitration award against Bhang, rescinding their agreement and awarding Mentor $1.5 million plus 10% interest. The judge further directed the parties to submit a proposed form of judgment by December 28, 2016.
Mentor CEO, Chet Billingsley, explains, “In the spring of 2014 Mentor exchanged $1.5 million cash and additional Mentor stock for 60% of Bhang Corporation, which we learned had less than $1.0 million in sales. However, after Bhang owners Scott Van Rixel, Richard Sellers and William Waggoner divided up and pocketed the cash, Bhang repudiated the contract, keeping the money, but refusing to deliver the Bhang shares. A senior arbitration panel ruled that they breached the contract. The panel granted Mentor’s request to rescind the investment contract which would result in the return of Mentor Capital’s $1.5 million plus interest. The panel gave Bhang nothing by way of damages.”
MENTOR CAPITAL INC COM NPV (OTCMKTS:MNTR) trumpets itself as a private equity firm specializing in acquisitions. The firm provides passive equity funding and liquidity to smaller companies and owners in the medical, marijuana and social use cannabis companies.
It invests in shelf IPOs and public and private companies and seeks to provide public market access to owners of small private companies. In case of shelf IPOs, the firm prefers to invest in companies with sales greater than $40 million. It prefers to take significant position in its portfolio companies. The firm invests only in companies that have earnings.
Mentor Capital, Inc. was founded in 1985 and is based in Ramona, California.
MNTR seeks to come alongside and assist private medical marijuana and cannabis companies and their founders in meeting their liquidity and financial objectives, to add protection for investors and to help incubate private cannabis companies.
According to company materials, “The Company seeks to come alongside and assist private medical marijuana and cannabis companies and their founders in meeting their liquidity and financial objectives, to add protection for investors and to help incubate private cannabis companies.”
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According to the company’s recent release, management is not a fan of the folks at Bhang at this stage. The rancor is clear in recent remarks from Mentor’s chief.
“After arbitration, it would have been nice if Bhang had paid the net of $1,626,760 due. This seems possible now because we guess that their business has grown to about a $6 million sales rate, strengthening their access to funds to add to our $1.5 million they retained. However, in Mentor’s opinion, Bhang continues to resist making any return of our money. That then pushes us into the judgment and collections phase, where we enlist the help of the courts and authorities to patiently collect the funds already awarded and due to us,” Billingsley concludes.
We’ve witnessed 56% piled on for shareholders of the listing during the trailing week. Market participants may want to pay attention to this stock. MNTR has a track record that includes a number of dramatic bounces.
Moreover, the stock has benefitted from a jump in recent trading volume to the tune of just under 160% over the long run average. This should not be overlooked with the stock trading on a float that is limited at just 13.11M shares. One is wise to respect the dynamic this may create — a restricted trading float and a jump in trading volume can crimp supply and push share prices higher.
At this time, carrying a capital value in the market of $19.96M, MNTR has limited cash of about $59k on the books, which stands against about $570k in total current liabilities. One should also note that debt has been growing over recent quarters. That’s not a great balance sheet situation, but the rest of the financial story is more compelling.
Mentor Capital is pulling in trailing 12-month revenues of $2.7M. In addition, the company is seeing major top line growth, with y/y quarterly revenues growing at 244.4%. As we see it, this is an exciting story, and we look forward to a follow-up chapter as events transpire. For continuing coverage on shares of $MNTR stock and other exciting stocks, sign up for our free newsletter today and get our next hot stock pick!