Small cap stocks IDGlobal Corp (OTCMKTS: IDGC), Embarr Downs Inc (OTCMKTS: EMBR) and SourcingLink.net, Inc (OTCMKTS: SNET) have been getting some extra attention in various investment newsletters or investor alerts lately as at least two of these stocks have been the subject of paid promotions or other types of investor relations activities. Of course, there is nothing wrong with properly disclosed promotions or investor relations activities. But just how hot are these two small cap stocks? Here is a closer look and a quick reality check:
IDGlobal Corp (OTCMKTS: IDGC) Recently Gave an Investment Portfolio UpdateSmall cap IDGlobal Corp is a diversified holdings company with a focus on emerging and middle market investment opportunities in North America. On Monday, IDGlobal Corp closed at $0.0005 for a market cap of $184,434 plus IDGC is down 88.9% over the past year and down 97.7% over the past five years according to Google Finance.
What's the Catch With IDGlobal Corp? According to various disclosures, no transactions have occurred to mention IDGlobal Corp in various investment newsletters. About a week ago, IDGlobal Corp provided an investment portfolio update which noted holdings in the following companies:
Physicians Healthcare Management Group: 198,385 Preferred B shares with conversion option at 40:1 to common shares and a $25,000 Receivable in form of Retainer Agreement; Phyhealth Corporation (OTCMKTS: PYHH): 1,000,000 Common Shares acquired. Apple Rush Company, Inc (OTCMKTS: APRU): 135,000,000 Common Shares just acquired.Top Asian Stocks To Own Right Now
In late January, IDGlobal Corp announced that it had been officially retained by the Physicians Healthcare Management Group to assist in the restructuring of the company as well as an ongoing strategic partnership. The assistance will focus on day to day operations, short term financing needs and the long-term vision of PHYH. Otherwise, IDGlobal Corp gave another corporate update in early January which noted the company had settled and written off more than US $200,000 in convertible indebtedness and was continuing to negotiate and is close to finalizing more. However, the most recent financials for IDGlobal Corp on Google Finance dates from the end March of last year. Given that along with the fact that investors can invest in small caps like PYHH and APRU on their own, its hard to get overly excited with IDGlobal Corp.
Embarr Downs Inc (OTCMKTS: EMBR) Expands Into ArizonaSmall cap Embarr Downs is involved in the buying, selling and racing of thoroughbreds. On Monday, Embarr Downs fell 1.85% to $0.265 for a market cap of $12.17 million plus EMBR is down 98.7% over the past year and down 97.3% over the past five years according to Yahoo! Finance.
What's the Catch With Embarr Downs? According to various disclosures, transactions of $2k, $2.5k and $19k have occurred to mention Embarr Downs in various investment newsletters. Last Thursday, Embarr Downs announced that Rock Off had been entered into the 8th race on Monday, March 24, at Turf Paradise for the company's first race in Arizona with shareholders of record on March 31 being entitled to 20% of the horse's net purse winnings. However, there has been no press release since then – meaning its probably safe to assume that Rock Off did not win his or her race. Otherwise and on Monday of last week, Embarr Downs announced that it will be attending the OBS sale for two-year-olds in training in Ocala, Florida with the expectation to acquire up to 3 thoroughbreds at the auction plus the company announced that it had filed its license application with the Arizona Department of Racing to expand its operations to Arizona with the CEO commenting:
"We were able to expand the number of thoroughbreds to 3 and start in 5 races and now we are taking the next step up in race class and begun paying an annual dividend of $.001 per share to our shareholders. Our next goal is to expand to 5-6 thoroughbreds and acquire a thoroughbred that is capable of competing in stakes races. The line of credit we have established allows us to fund the acquisition of these thoroughbreds without the need to issue a single share of common stock. We have a 2 year plan (which we are 3 months into) to have 15-20 thoroughbreds racing for us and to have 5-10 broodmares in our breeding division."
The problem for investors though is that I am not seeing any financials for Embarr Downs on either Google Finance or Yahoo! Finance – meaning its investor beware.
SourcingLink.net, Inc (OTCMKTS: SNET) Has Been Quiet Since DecemberSmall cap SourcingLink.net signed an agreement to acquire 100% interest in the Eldor Rare Earth Property Claims (The Eldor Project) located in Northern Quebec, Canada. The Eldor Project consists of 21 mineral claims covering approximately 2438 acreage and is located in Northern Quebec which is considered one of the most favorable mining jurisdictions in the world. On Monday, SourcingLink.net jumped 13.73% to $0.0058 for a market cap of $698,314 plus SNET is up 427.3% over the past year and up 93.3% over the past five years according to Google Finance.
What's the Catch With SourcingLink.net, Inc? According to various disclosures, a transaction or transactions of $7.5k have occurred to mention SourcingLink.net in various investment newsletters. However, SourcingLink.net has been quiet since mid December when the it gave an update about its strategy of obtaining distressed or undervalued Rare Earth Element (REE) properties or assets "due to unprecedentedly low valuations in the Jr. mining market sector." The press release noted that SourcingLink.net had recently acquired the Eldor Property in Northern Quebec, Canada, which is located adjacent and contiguous to Commerce Resources Corporation's Ashram Deposit that has a Preliminary Economic Assessment (PEA) with a Net Present Value (NPV) at a 10% discount rate of $2.32 billion. Otherwise and in mid August, SourcingLink.net announced it had executed on the Purchase Agreement to acquire 100% of the Eldor Property by making the initial payments. A quick look at SourcingLink.net's financials reveals revenues of zero (most recent reported quarter), $18k and $1k for the three reported quarters of last year along with net losses of $1,512k (most recent reported quarter) and $22,025k and net income of $23k. At the end of December, SourcingLink.n had $13k in cash to cover $267k in current liabilities and $356k in long term debt. So investors might want to wait for more news and more financials to appear before getting overly excited here.
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