OTC Stocks: Is MyEZSmokes (XRMB) Smoke and Mirrors?

Have you ever heard of an electronic cigarette? Shares in MyEZSmokes Inc. (Pinksheets: XRMB) have been on a steady rise closing at an all-time high yesterday of $0.53 for the penny stock. But is it all smoke and mirrors for XRMB or is the growth in share price reflective of where the company is headed?

The Fiscal year end for MyEzsmokes is December 31. The Company reported, via an uploaded document onto OTCMarkets, Cash and Cash Equivalents for fye 2011 of $5,621 compared to $24,872 fye 2010. Accounts Receivable decreased to $7,248 fye 2011 compared to $30,872 fye 2010. Inventory increased to $37,055 compared to $22,814 at the end of 2010 giving XRMB Total Current Assets for the year ended December 31, 2011 of $49,924 compared to $78,558 for the year ended December 31, 2010.

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XRMB Stock Chart:

Market Cap: 60.76M
Price/Sales (ttm): 1,700.00

52-Week High
(May 8, 2012): 0.53

52-Week Low
(Dec 7, 2011): 0.15

Avg Vol (3 month): 111,927
Avg Vol (10 day): 181,614

Shares Outstanding 52.61M
Float 24.01M

The Accumulated Deficit for the year ended December 31, 2011 was only $395,668 which would appear to be quite healthy for such a young company. But then, when you review their Income statement, questions begin to arise.

In 2011, MyEzsmokes Revenues dropped from $152,379 to just $35,742, a decrease of -76.54%. Gross Profit, although there is some, followed the same pattern dropping from $ 62,804 to $13,392. But the kicker is the bottom-line: Weighted Average Shares Outstanding (WASO). WASO increased for the year ended December 31, 2011 to 68,324,889 from 861,868 for the year ended December 31, 2010. Hence the pump on XRMB.

About XRMB Stock

My Ezsmokes Inc. was originally incorporated under the laws of the state of Nevada on February 20, 2004 as Desitv.com, Inc. On April 3, 2006 the Company changed its name to Xero Mobile and then in April 2011 to My Ezsmokes Inc.

The Company specializes in the manufacture of a smoke free cigarette. The Company consists of itself and its two wholly owned subsidiaries, Fashion Handbags, Inc., (FHI) which was incorporated in August of 1997 and the MyEZSmokes Company. FHI specializes in the development, manufacture and marketing of contemporary specialty bags.

Bottom Line: The penny stock of MyEzsmokes, XRMB, has no news, no financial filings except the uploaded Income statement on OTCMarkets, and a tremendous increase in the total number of shares. Add them to your list but trade carefully because XRMB stock chart could be a a bunch of “smoke and mirrors.”


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