Penny stock traders were almost duped into jumping aboard the PR train being driven by RVPlus Inc. (OTC:RVPL), the holding company of ECCO2 Tech. Having been sporadically traded at best since August, RVPL stock has doubled since Christmas eve after suddenly surging on Thursday after announcing a $10.5 million material agreement with the Ministry of Planning and Economic Affairs for the Republic of Liberia. The record volume trading session from Thursday was nearly doubled Friday when the Company focused a PR on their growing accounts receivables. While money owed can be a good thing, how much green does the green technologies focused Company actually have and what is realistically due?
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RVPL Stock Chart
Market Cap: 13.16M
Close: 0.1101 ▲ 0.0101 (10.10%)
Dollar Volume: $73,639
Average Trade Size: 7,610
Issued and Outstanding: 119,560,000
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Up until May, 2012, RVPlus was a “shell company” focused on developing, testing, manufacturing, and marketing products related to the recreational vehicle industry. On May 4, the Company issued 80 million shares of RVPL for licensing rights subject to 3% roaylties due on all net profits from product and service sales. The deal allows for the Company to develop, use, and market the present and future products and services, letterhead, newsletter, masthead, promotional items, and course materials with respect to the Intellectual Properties of ECCO2 Corp, a not-for-profit Texas corporation.
Since the acquisition, RVPlus has done nothing profitable with their licensing rights of ECCO2 products other than issue a few announcements of multi-million dollar deals with governments around the world who can barely afford to run electricity in their capital buildings. While the recent Liberia deal is less obnoxious compared to the $90 million deal they struck with Haiti in November, the clear indcator as to whom will go long on RVPL stock is in their most recent PR and 10-Q.
With just $7,620 in the bank as of September 30, 2012 and an accounts receivable of $8,653,846, not only is their an imbalance in regards to their assets matching liabilities and stockholder’s equity, the balance sheet, but there are no corresponding sales/revenues to match the journal entry of the accounts receivable. Accounting 101, How to book accounts receivable:
Accounts Receivable: XXXX
When cash is collected:
Accounts Receivable: XXXX
The eventual net profit/loss would be booked to increase/decrease shareholder’s equity, thus balancing the books.
But wait, it gets better.
In the Results of Operations section of the Q filing, “As of December 20, 2012 the company has made entry into two definitive material agreements with foreign government parties for goods and services, holding a total value of $1,890,000,000 (1.89 billion US dollars), which are associated to Civil Society Programs, collectively organized by United Nations affiliates and Parties. Thus, the company’s subsidiary, ECCO2 Tech is designated as the exclusive vendor and supplier for each Civil Society Program for 10 years from the affective date of both material agreements.”
I can’t wait to see that show up in accounts receivable with no corresponding revenues in the next Q to fluff traders who lack the effort to research what they are getting into. My accounting teacher in college would have hurled the 18lb Accounting 101 book at my head had I furnished a balance sheet like RVPlus did.
About RVPL Stock
RVPlus, Inc. is a development stage company with very limited operating history and have generated a low amount of revenue since inception. Click here to view the SEC filings for RVPL.
Last 5 Trading Sessions:
Bottom Line: RVPL is a sub penny stock at best based on the findings and method of fluffing their PR. Those who fell into RVPL stock trap expecting to see a huge run as one of the penny stocks for 2013 are better off placing their money on “00” if they can find a roulette wheel willing to take a $968 bet.
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