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Lot78 Inc (OTCMKTS:LOTE) Due For A Short Squeeze

Lot78 Inc (OTCMKTS:LOTE) Due For A Short Squeeze
Written by
Jarrod Wesson
Published on
September 21, 2017
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A lot has happened in the stock of Lot78 Inc. (OTCMKTS: LOTE), the electric vehicle charging station developer, thus we decided to write another update on this name.Our readers will be remembering well that in our previous piece called "Lot78 Inc (OTCMKTS:LOTE) Fighting Off The Shorts", we noted that when the company was delivering no news or good news, the share price declined. Honestly, it did not make much sense. Hence, we said, that short sellers seemed to be operating on the stock.In July, August and September, the company released new information and made the trading volume pick up. More than 6 million shares changed hands some days; have a look at it before we assess the news released: 1 year chart for LOTE 1 month chart for LOTELet's revisit the company again for the new readers.The company is based in Connecticut and invests in underperforming companies or businesses that require the expertise of LOTE's management. The most significant in this company is its stake in an electric vehicle charging station company, Juice Bar EV. This business activity is what we have been studying in our previous reports. We encourage readers to have a look at it, since the EV industry is picking up and many other EV manufacturers are profiting and delivering interesting returns to their shareholders.Recent DevelopmentsOn July 20, 2017, the company released that it had been awarded fourth installation of its Juice Bar Electric Vehicle Charging Station at the Hilton Market Square in San Francisco. The news is very significant, as it shows that the company is really being able to sell its technology. We knew that the company had installed other stations at hotel parking facilities in Boston, MA, San Francisco CA, and New Haven CT, but this new one, close to the Hilton, is even better news.The CEO, David Schmid, explained that hotel parking facilities are great places for electric vehicle charging installations, since hotel guests can be served by in-house employees while the cars are being charged. We believe that it is a great business model and as the CEO noted, it is a market segment offering sustainable growth opportunities for LOTE.On August 8, 2017, the company announced that orders to acquire the company's technology had increased. More in detail, it was noted that "in the 45 days ending July 31, 2017, Juice Bar has taken orders for $125,000." Additionally, the press release reads that Juice Bar has 70 active quotes in its pipeline totaling $760,000. Furthermore, among what the CEO said, we believe that the most significant was the following:

"With the positive buzz revolving around the launch of new electric vehicles such as the Tesla 3 and the Chevy Bolt, the need for electric vehicle charging stations has never been more real and exciting. Juice Bar Electric Vehicle Charging Stations' premium brand is well positioned to take advantage of this unique time in the adoption of vehicle electrification." Source

What does it mean?As we noted in the previous news, it shows that the company is growing the business at a high pace. Again, like it happened in previous months, the share price did not react to the news.The share price kept going down in August until it reached the level of $0.05, where it seems that short sellers decided to close some of their shorts. Please, check in the stock chart that there was a large share price spike on August 30, 2017. The price went from $0.06 to almost $0.13 in a few sessions. We believe that it is the typical pattern shown in stock controlled by short sellers.Do you want more proof?Have a look at how the short interest declined on August 31, 2017. In the following table provided by the OTC Markets, it is very clear that short sellers increased their activity in the month of August:DateShort Interest% ChangeAvg. Daily Share VolumeDays to CoverSplitNew IssueAug 31, 201732,613-75.552,908,8691.00NoNoAug 15, 2017133,369998.231,045,0871.00NoNoJul 31, 201712,144-71.22301,5581.00NoNoSourceConclusionCurrently trading with a market cap of $11 million, LOTE seems to be suffering as a result of short sellers. The company is growing and delivering interesting news, which we appreciate much. But, the unethical behavior of these market participants keeps pushing down the share price. However, we believe the price has been pushed down to illogical levels and a short covering rally is due.We will be updating our subscribers as soon as we know more. For the latest updates on LOTE, sign up below!Be sure to check out our coverage on LOTE.Image courtesy of Jessica L Wyatt via FlickrDisclosure: We have no position in LOTE and have not been compensated for this article.

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