Death of a Company

The Pink Sheets are often viewed as the birthplace of new companies, where concepts meet public capital in an intricate process of implementation. Often these companies are spawned into public life out of the shells of companies with broken pasts through a reverse merger process. Yet as in every circle of life, there must be death before there is life. In regards to the Pink Sheets, it should be viewed as an open gateway between the life and death of public companies. There are the dying companies that have no future (many that have fallen from the graces of the upper exchanges after being delisted), the stagnant companies unable to clear the pink sheet gravity and will eventually die just as the former, and finally the undervalued gems with futures that can eventually clear the lower exchanges obstacles.

Not all companies on the Pink Sheets are in a transitive state. Well-known companies like Nestle (NSRGY.pk) and Heineken (HINKY.pk) call the Pink Sheets their home for instance. Yet for the most part, and for most people, the Pink Sheets will always be that high-risk zone where the rules of the game starkly change. Like a stigmata, the “.pk” brands companies with the degrading mark of instability, volatility, and a general sense of futility.

As another rule of thumb for penny stock investors (PSI), it is wise to stay away altogether from delisted companies. Companies that have failed to retain their spots on the upper exchanges are the fallen angels of the investment community. They carry momentum of a dangerous kind, as their futures are vague or perishing and the need to raise capital likely lurks around the corner. A wise PSI will fish in “safer” waters by trying to find companies that are new to the market, and yet not new as a company. Stop watching companies that have come to the Pink Sheets to die. After all, resurrections are a rare occurrence.