The latest cannon-blast to the upside on the OTC is owned by Cardiff Lexington Corp (OTCMKTS:CDIX) which saw its shares moving higher by nearly 2,000% in a single day, moving from a triple-zero sub-penny to well over a penny on Tuesday. The clear catalyst is a little bit difficult to understand. On the one hand, we see the company’s announcement of a 63 percent year-over-year revenue increase. According to the release, the revenue increase marks the most significant financial gains in Platinum Tax Defenders’ history.
However, on the other hand, there exists a scattering of information suggesting the company may have just entered into a letter of intent to acquire a CBD company. The tricky part here is that this secondary idea seems like it fits with a reverse-merger type of story (which would certainly fit as an underlying catalyst for the type of action we saw on Tuesday. But it was just a day earlier that the company was talking up its success in its present line of business. Time will tell.
Cardiff Lexington Corp (OTCMKTS:CDIX) promulgates itself as a company with a history of helping small to medium-sized businesses thrive and survive for over 18 years. One of its most important moves over the past year was acquiring “Platinum Tax Defenders” in July 2018, signing a definitive merger agreement under which Platinum Tax Defenders merged into Cardiff Lexington Corp. The acquisition increased Cardiff Lexington’s total annualized revenue to $6.7 million.
Cardiff Lexington is a public holding company that, according to its materials, leverages proven management in private companies that become wholly-owned subsidiaries. Cardiff Lexington does not focus on finding businesses in a specific industry or part of the country; they look for proven management, market, and margin.
When looking for companies in which to invest or acquire, Cardiff looks for mature, high-growth, niche companies. Cardiff’s strategy is to identify and empower select income-producing middle market private businesses and commercial real estate properties. When these companies come under the Cardiff umbrella, they are provided with an increased opportunity to raise money for operations and expansion, or an equity exit and liquidity strategy for the owner, heirs, or investors.
If you’re long this stock, then you’re liking how the stock has responded to the announcement. CDIX shares have been moving higher over the past week overall, pushing about 2400% to the upside on above average trading volume.
Shares of the stock have powered higher over the past month, rallying roughly 942% in that time on strong overall action.
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As noted above, CDIX just announced a 63 percent year-over-year revenue increase. According to the release, the revenue increase marks the most significant financial gains in Platinum Tax Defenders’ history.
Traders will note 2400% during the past week in terms of shareholder gains in the stock. Furthermore, the company has seen interest climb, with an increase in recent trading volume of approaching 1100% above the average volume levels in play in this stock over the longer term.
“We are thrilled to report this revenue increase for Platinum Tax Defenders, a company that is truly doing good for so many taxpayers across the country,” said Alex Cunningham, President/CEO of Cardiff Lexington. “It’s very promising to see the growth that Platinum Tax Defenders has experienced in only one year that they’ve been under our umbrella. We look forward to positioning the company for even more exponential growth in the future.”
Earning a current market cap value of $2.3M, CDIX has virtually no cash on the books, which is balanced by about $12.5M in total current liabilities. One should also note that debt has been growing over recent quarters. CDIX is pulling in trailing 12-month revenues of $3M. In addition, the company is seeing major top-line growth, with y/y quarterly revenues growing at 244.2%. We will update the story again as soon as developments transpire. Sign-up for continuing coverage on shares of $CDIX 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 $CDIX, either long or short, and we have not been compensated for this article.