Simulated Environment Concepts, Inc. (PINK:SMEV) has lost more than it had gained on Jan. 14. The fall started immediately after the record performance and yesterday SMEV stock lost another 8.89% of its price, closing at $0.0041. This is dangerously close to the low from December 31, 2010. The volume was also pretty low, reaching barely 2.5 million.
One possible reason for the current decent of SMEV could be the fact, that the company has been promoted by Investor Voice, and the promoter was paid by a third party both cash and common stock. This alone wouldn't be too much of a concern, but recently Investor Voice has paid at least $25 thousand to other promoters for SMEV advertising and promotional services. When a promoter previously compensated with free trading shares pays for a promotion, there is a strong possibility that they might sell off their shares in the promotion.
On Jan. 18 the company announced that it planned to release a recorded Shareholder Address from Dr. Ella Frenkel, President and CEO of SMEV, on Feb. 4. The PR says the company is going to make "key announcements" during the planned address and conference call. This news might have created some mystery around SMEV, but it was not enough to alleviate the tension from the paid promotions.
Another thing which could bother potential investors is the growth of the number of issued and outstanding shares of the company. According to the data, provided in SMEV's most recent quarterly report, for the period from December 31, 2009 to September 30, 2010, the company has issued approximately 92 million shares of common stock. This number means the outstanding shares have nearly doubled.
With the shadow of uncertainty thrown by the promotions, and the lack of a financial report to put numbers behind the positive announcements from earlier this month, the fall of SMEV stock price may continue. When the company comes out with the promised key announcements, they will have to be really convincing, if the company wants to turn things around.