ESWB | Is Esio Water & Beverage Development A Bargain?

ESWB stock,Esio Water and Beverage Development Corp.,OTC ESWB,Beverage stock lovers will find themselves looking at a new ticker on Friday as Tempco Inc. (TEMO) changes to Esio Water and Beverage Development Corp. (OTC: ESWB). The Company issued news back in October after it entered into a Regional Developer Deposit Agreement for the rights to sell ESIO Hot & Cold Beverage System products in the Dallas-Fort Worth area. With ticker change in place, cash and a share structure to die for, ESWB deserves its place on the list of penny stocks to watch.

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Market Cap: 3.34M
Last: 0.18  0.02 (-10.00%)
Volume: 10,578
Dollar Volume: $2,029
Open: 0.195
High: 0.20
Low: 0.18
Trades: 5
Authorized: 50,000,000
Issued and Outstanding: 18,566,636
14-Day Rel Strength: 46.04%
14-Day Stochastic: 12.50%

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Back in August, 2012, Tempco closed the regional developer deal and three franchise agreements with ESIO Franchising LLC for the Dallas/Fort Worth region of Texas, a region with a population of over 7.7 million people and over 2.8 million households. The deal cost the Company $250,000 cash, $70,000 of which was previously deposited for 10 other regions. The deal allows the Company, now renamed Esio Water and Beverage Development Corp. to sell countertop and free-standing Esio Beverage Systems directly to consumers as well as provide maintenance and repair services to their customers.

The Esio Hot & Cold Beverage System is considered by some to be the most convenient appliance available to retail consumers since the microwave oven. By allowing users to have their favorite name brand hot and cold drinks in any size or strength desired in seconds at the touch of a button, the product which takes up the space of a coffee maker or water dispenser unit, is set to be available in 2,400 Wal-Mart stores for $199 which includes two free E-Paks, a $12 value.

The best part about the expanding drink selection offered in the E-Paks is that they are the name brands that most people consume already on a daily basis but at a fraction of the cost. At present, the available selection of drinks (see here) includes the following brand names:

  • Apple & Eve
  • Barista Brothers
  • China Mist
  • Country Time
  • Crystal Light
  • Diet Brisk
  • Maxwell House
  • Sqwincher
  • V8 Splash
  • Vita-24

As for the name and ticker change, chances are PR is due to begin flowing since ESWB stock trading has picked up a bit since the middle of December. While the chart looks unappealing to many, the reason why you would want to own shares in this is simply based on crunching the numbers.

With cash on hand at September 30, 2012 of $368,000, the Company acknowledged that its sufficient to fund the costs of general and administrative expenses for the next 12 months. Between July 31, 2012 and August 14th 2012, 2,656,489 shares of ESWB stock was issued to 16 accredited investors along with warrants to purchase 2,983,989 shares at an exercise price of $.75 for the conversion of $655,000 of convertible notes payable and accrued interest of $9,124. Doing the math, that’s just under 0.22 per share and an option to buy another share at 0.75.

With just 50 million shares authorized, 18.56 million outstanding, 5.46 million which were owned by insiders as of October 11, 2012, holders of restricted securities issued while Tempco was a shell company may not re-sell them pursuant to SEC Rule 144 for a period of one year after the Company ceases to be a shell, a suspension which ends on April 17, 2013. Until that time, the float is healthy enough to offer some upwards price movement if momentum builds up.

The franchise agreement allows for the Company to further expand to the following 10 areas:

  • San Antonio, Texas Metropolitan Area
  • Houston, Texas Metropolitan Area
  • State of Arizona
  • State of Colorado
  • Jacksonville, Florida Metropolitan Area
  • San Francisco Bay Area and Eureka, California
  • Sacramento/Chico, California and Reno, Nevada
  • Orange County, California
  • San Diego and the Imperial Valley, California
  • NW Los Angeles, California (Ventura to San Luis Obispo)

Based on the agreement, the first 3 franchises must be opened within 1 year. Once its 3 franchises are operating, Esio Water and Beverage Development Corp. will receive 50% of the initial franchise fees ESIO receives from its franchisees in the Territory and 40% of all royalties ESIO receives from its franchisees in the Territory, excluding advertising fund payments. Looking down the road, ESWB has the potential to put up some positive EPS based on the business model and worth a look at.

About ESWB Stock

Esio Water and Beverage Development Corp. business model is focused on developing the Dallas/Fort Worth franchise region with the exclusive right to operate and sell to others franchises in that territory for the distribution to consumers of a line of patented ESIO beverage dispensers and beverage concentrates in packets designed for use with the dispensers. Click here to view the SEC filings for ESWB.

Last 5 Trading Sessions:

Date Last Change % Change Volume
01/17/13 0.1800 -0.0200 -10.00% 10,578
01/16/13 0.2000 -0.0400 -16.67% 27,600
01/11/13 0.2400 +0.0400 +20.00% 13,000
01/10/13 0.2000 -0.0274 -12.05% 45,600
01/09/13 0.2274 +0.0274 +13.70% 5,000


Bottom Line: The ticker change from TEMO to ESWB is the real news for this penny stock right now. With expectations of PR to be issued, traders should take note of the details behind the franchisee since short-sighted traders may miss out on the bigger picture when it comes to ESWB stock or perhaps over estimate the possibilities long term — glass half full or half empty kinda thing.

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