Can Easton Pharmaceuticals Inc (OTCMKTS:EAPH) Pull Another Rabbit Out of Its Hat?

Can Easton Pharmaceuticals Inc (OTCMKTS:EAPH) Pull Another Rabbit Out of Its Hat?


One stock that exploded higher on Tuesday in high volume trading on the OTC was Easton Pharmaceuticals Inc (OTCMKTS:EAPH). The move comes on the heels of the company’s announcement that it has signed an agreement to acquire a commercial bakery with existing revenues and projected to reach over $20,000,000 within 12 months. Shares exploded higher on news of the deal, launching as much as 100% higher on 25 times the three-month average volume of trade in the stock.

According to the release, “In its ongoing efforts to diversify and enter other lucrative sectors and add value-added businesses to achieve consistent growing sales to coincide with its revenue-generating framing contract and its pharmaceutical / diagnostic division, Easton is pleased to have signed an agreement to acquire a Toronto based commercial bakery and food preparation company which manufactures white labeled food products for third party food companies and its own line of niche food product lines, sold in major grocery chains, as well as specialty coffee chains. The company has an R&D division with product development and has begun discussions with licensed producers of cannabis, as well as food chains in order to develop and supply cannabis edible products.”

Easton Pharmaceuticals Inc (OTCMKTS:EAPH) promulgates itself as a specialty pharmaceutical company that designs, develops, and markets various topically delivered drugs and therapeutic health care products.

Its products include Nauseasol, a motion sickness gel; Skin Renou HA, an anti-aging wrinkle cream using hyaluronic acid, which keeps the skin smooth; Kenestrin Gel used for arthritis, knees, elbows, shoulders, wrist, and back pain; Viorra, a hormone free, non-toxic, and topical gel that improves sexual functioning of women; and female sexual arousal disorder drug.

The company is also developing XILIVE, an early stage cancer drug. In addition, it is involved in the medical marijuana business.

According to company materials, “Easton Pharmaceuticals is a diversified specialty pharmaceutical company involved in various pharmaceutical sectors and other growing industries. The Company previously developed and owned an FDA-approved wound-healing medical drug and currently owns topically delivered drugs to treat cancer and other therapeutic products to treat various conditions that are all in various stages of development and approval. Easton, together with BMV Medica S.A. own the exclusive distribution rights in Mexico and Latin America for two patented women’s diagnostic products and a novel natural treatment for Bacterial Vaginosis, which they have sub-licensed to Bayer and Gedeon Richter. In addition, a generic cancer drugs line is being developed for sale in Mexico. The company’s gel formulation is thought to be an innovative and unique transdermal delivery system that can in the future be adaptable in the delivery of other drugs. As part of its strategic growth plan, the Company will be entering new lucrative market segments globally, including Gaming, Real Estate Development and Hospitality and Food and Beverage, among others.”

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As noted above, EAPH just announced that it has signed an agreement to acquire a commercial bakery with existing revenues and projected to reach over $20,000,000 within 12 months. Traders will note 70% tacked on to share pricing for the stock in the past week.

Furthermore, the stock has benefitted from a jump in recent trading volume to the tune of just under 430% beyond what we have been seeing over the larger time frame.

Easton’s CEO Evan Karras stated, “We are extremely pleased to have signed a definitive agreement to acquire what we believe to be a successful commercial bakery and food preparation company, that together with their market knowledge and market share, and our expertise and infrastructure, we will be able to increase the sales fairly quickly.”

Earning a current market cap value of $16.2M, EAPH has virtually no cash on the books, which stands against about $325K in total current liabilities. One should also note that debt has been growing over recent quarters. EAPH is pulling in trailing 12-month revenues of $307K. In addition, the company is seeing recent top-line growth, with sequential quarterly revenues growing at 717.9%. You can bet we will update this one again as new information comes into view. Sign-up for continuing coverage on shares of $EAPH 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 $EAPH, either long or short, and we have not been compensated for this article.

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