AMAZONAS FLORESTAL COM USD0.001 (OTCMKTS:AZFL) is the latest interesting story on Wall Street. Like many times in penny stock land, we will see in this article that there are day traders, who are loving it, and some market participants who say that it is not a legitimate business. Before anything else, have a look at the most recent price action and note the large volume.
BusinessAZFL is a forest company, founded in 2010, and headquartered in Miami, Florida, but with operations in the Amazonas, Brazil. The annual report reads that the management team and its shareholders owned "large tracts of land in the Amazon Rain Forest for over fifty years, and are committed to sustainable forest management and the biodiversity in the area". This is from the most recent quarterly report. Have a look:SourceFurthermore, according to the news reported by AZFL, the company seems to be growing CBD Hemp in Weld County, Colorado. The management team seems quite opportunistic for this project, as the marijuana business seems to be next gold fever in America after the legalization of some forms of marijuana. Is it the first time that you read about it? If yes, then have a look at these articles about it.SourceRecent DevelopmentsOn Jun 6, 2017, AZFL noted that a company subsidiary, Amazon Hemp Ltd., completed plating its second 100-acre field in Weld County, Colorado, where 474,600 seeds were used. Several executives expressed their opinion in the press release, but it was the Company Chairman of Amazonas Florestal, Ltd, Ricardo Cortez, who best expressed the company's growth:
"Planting this second field completes our seeding process and allows management to move forward with its plans to purchase a property nearby these two fields where the harvested product can be securely stored, dried and processed. The properties that are under review for purchase include sufficient acreage for the kitchen and lab facility where our contractors in Colorado will set up operations to use the CBD Hemp flower, once dried, in the processing of High CBD oil, distillates and islet crystals." Source
On the top of it, in the same communication, the opening of a new lab close to the fields was noted. Market participants should have become quite interested once they got to know it. We will see the market reaction later.
"Management intends to close on one of these properties now in the month of June and order the construction and lab equipment in July so that it can be installed in time to receive and process the dry flower starting in October." Source
On May 23, 2017, the company noted that the first 100-acre field had been planted. The market got to know this news here.Market Reaction to this NewsWe could see that the plantation of first 100-acre field did not have a large market reaction. It was the second announcement on June 6, 2017 that had a large impact on the share price. We believe that the lab announcement is responsible for it. The volume started increasing that day, have a look.SourceIf the company is growing, why did the share price decline in August 2016? The company did not release any news to justify it, but we believe that it had problems with the previous CEO. The company did not announce when he quit, but on February 2, 2017, a new CEO was elected. We also discovered some of the reasons behind it on the iHub Forum.Financial Situation and ConclusionBelieve or not, the balance sheet of the company seems clean. As of March 31, 2017, it shows $340,000 in cash in hand, $3,834,000 in total assets, and only $3,226,000 in total liabilities according to the OTC Markets website. Furthermore, the total outstanding shares are 1,257 million shares, thus the net asset value per share is $0.18.To sum up, this is a business that seems to be growing at high pace and with exposure to the cannabis industry. The company owns properties in Brazil, and the net asset value per share is much larger than the share price. Like in every new business, we find day traders claiming that it is not legitimate. We found them this time on the iHub Forum. It is up to you to draw a conclusion. In any case, even if readers are long or short selling, we will be covering the latest developments. Try to be alert on this one!We will be updating our subscribers as soon as we know more. For the latest updates on AZFL, sign up below!Image courtesy of FlickrDisclosure: We have no position in AZFL and have not been compensated for this article.
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