A 400,000% Return

Floyd Norris asks, “Has a Penny Stock Become a Big Company?”
In my opinion, the short answer is no. If any company is serious about its business and its future, it has no business being listed on the pink sheets. Any real company has nothing to fear from full disclosure. Multimedia Kingpin Tim Sykes makes his living doing nothing but spotting phony pink sheet stocks that have no reason business outside of issuing daily press releases.
The longer answer, however, is that yes, a very smaller number of stocks that have fallen to less than $1 per share have gone on to become real companies.
In early 1985, Apco Argentina (APAGF) traded for as little as 12.5 cents (or an 1/8 back then). The stock has since split 4-for-1 (last November) so it was even less than that. It’s now worth about $27 a share,
A better example is Mylan Labs (MYL). That stock was going for 75 cents a share in 1976. Since then it’s split 11 times (one 5-for-4, four 2-for-1 and six 3-for-2) for a total of 227.8125 for 1. Which means that adjusted for splits, the stock was going for less than one-third of a penny per share. Mylan is now going for $13.72 which is about half what it was five years ago. Still, that’s a nice 400,000% return from its low.
(H/T: Paul K.)

Posted by on August 18th, 2008 at 11:06 am


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