65°F
weather icon Mostly Cloudy

Don’t dismiss companies with penny stocks

Yes! Subpenny stocks – that is less than a penny per share – are alive and well right here in Las Vegas.

That means that at .001-cent per share, you could buy 1 million shares for $1,000. If the shares increased in value to .01-cent per share, you would make 10 times your money.

I am not pushing penny stocks. What I am saying is, if you uncover an interesting looking company, don’t turn your back on it because its stock is valued at a penny or less per share. There are 15 companies in the Las Vegas area that are trading under a penny per share and another seven or so trading between a penny and a dime per share. So opportunity is all around us.

Some of those penny stocks represent exploration companies that typically have losses until they actually find something of value – such as oil or uranium or gold.

For example, Can-Cal Resources Ltd. is a public company based in a residential neighborhood on Aqua Spray Avenue in Las Vegas. Its website says it is “engaged in the acquisition and exploration of precious metals and mineral properties.” The company has teamed with UNLV geologists to explore Cal-Can’s 3.8-square-mile tract near Wikieup, an Arizona town on the road from Las Vegas to Phoenix. The company also has land at Pisgah, in the Mojave Desert near Ludlow, Calif.

Both the CEO, G. Michael Hogan, and the board chairman, William J. Hogan, are Canadians. The website offers no clue on any familial connection, but that would be a subject for investor exploration. Each seems to bring an impressive background: the CEO is the former Canadian manager of strategic planning for Texaco and has 15 years with Assante Capital Management. The board chairman is the founder of FoodChek Corp., a Calgary firm that develops food safety pathogen testing.

The company’s 10k filing with the SEC notes: “For the year ended Dec. 31, 2013, the company recorded a net loss of $329,994 and had an accumulated deficit of $10,692,541 at that date. Our ultimate success will depend on our ability to generate profits from our properties.”

And that success would seem to turn on what — if anything of value — Can-Cal finds on and under all that desert land. So would the stock’s value.

Can-Cal is just one of the low-share-price mining sector firms located here.

Ireland Inc. is a Henderson company, also with Canadian principals, that is targeting land near Tonopah.

And Lithium Corp. is looking for lithium and graphite deposits that could play a role in the future of battery technology vital to the development of the electric car industry. It lists an address on Lingering Breeze Street in Las Vegas as its corporate home.

So, in evaluating companies like this, what should an investor be looking for? Start with finding out what the company does. Do they have revenue and make a profit? What is the background of the CEO? Does the company have any patents or own any real estate? Are they looking to merge or acquire another business? How many share are outstanding and how many shares do the insiders own?

Much of this is available online. Start with the company website and explore information available on sites like finance.yahoo.com and Hoovers.com.

You may see the stock has hardly been trading at all and the price has hardly moved. Seemingly, nobody is interested in the stock. Don’t let that deter you — yet. Remember, buy low, sell high. If the stock is heavily traded and the price is up, chances are you are too late. The tendency among investors is to say “look, everyone is buying; we better get aboard.” There is more profit potential in buying when no one else is, but only if we see real potential.

Another way investors can profit from penny and sub-penny stock is a maneuver most investors have never heard of called the ‘reverse merger.’ That’s when a private company that wishes to become a public company virtually overnight buys control of a public company, usually one with stock valued at a penny — or less. When that happens, it is not unusual for that penny stock to run up 500 to 1000 percent — increasing your investment five to 10-fold.

Yes, it is a long shot. But it happened right here in Las Vegas when Broadleaf Capital did such a transaction. It was trading at 3.5-cents per share in July and recently was trading at 33 cents per share under its new name, EnergyTEK Corp. (ENTK).

Caution. If you hear a company is a “shell company,” perhaps you should look elsewhere. A “shell company” is one that has no business. The SEC is clamping down on shell companies and even suspending trading in the stock in some cases.

On the other hand, a shell company may be looking for a deal. Visit the company and meet with the controlling stockholder. He, she or they may be glad you took an interest.

You can never be sure when you invest in stocks but diligent research can shift the odds in your favor.

John Glushko is a retired stockbroker, a private investor and author of books and articles on investing. He lives in Las Vegas. His column will appear occasionally.

Don't miss the big stories. Like us on Facebook.
Business Videos
How much do Las Vegas casino CEOs make?
Las Vegas gaming CEOs made anywhere between $1 million and $24 million last year, according to company filings with the U.S. Securities and Exchange Commission. ((Las Vegas Review-Journal)
30-year-old Rio needs a little TLC
Nearly 30 years after the Rio opened, the red and blue jewel that helped catapult Las Vegas to a new level with its buffet and nightclub has lost its status along with its shine.
The latest on the Drew Las Vegas - VIDEO
Eli Segall recounts his tour of the Drew Las Vegas, formerly the Fontainebleau, on the Las Vegas Strip. (Michael Quine/Las Vegas Review-Journal)
Pinball Hall of Fame to move near south Strip
Operators of the Pinball Hall of Fame have been approved to build a new, larger arcade near the south edge of the Strip on Las Vegas Boulevard near Russel Road. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
National Hardware Show underway Las Vegas
The National Hardware Show kicked off Tuesday at the Las Vegas Convention Center (Mat Luschek / Review-Journal)
Caesars for sale?
Caesars Entertainment Corp. has been swept up in takeover speculation since the company’s share price tumbled last year amid disappointing earnings and concerns over a recession. Amid the decline, hedge funds scooped up shares. Billionaire activist investor Carl Icahn began buying shares of Caesars as early as January. Icahn acquired nearly 18 percent by mid-March. In February Icahn called on the Caesars board to study a sale as a way to boost shareholder value.
Las Vegas home prices
Las Vegas home prices grew fastest among major markets in February for the ninth straight month. But amid affordability concerns, the growth rate has slowed down. Southern Nevada prices in February were up 9.7% from a year earlier, according to the latest S&P CoreLogic Case-Shiller index. The last time Las Vegas' price growth fell below 10% was in September 2017, S&P Dow Jones Indices reported.
Free Parking Coming To Wynn
Free parking will come to the Wynn and Encore resorts on May 1, 2019. (Mat Luschek / Review-Journal)
Founding Venetian employees talk about 20 years at the Strip resort
The Venetian, which opened May 3, 1999, is celebrating 20 years on the Las Vegas Strip. Seven original employees talk about opening the luxury resort and working there for two decades. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
Circa aiming for December 2020 opening
The 1.25-million-square-foot property will have 44-stories and 777-rooms. It will also have a separate nine-story, 1,201-space parking garage.
Boxabl official explains the building concept
Boxabl business development manager Galiano Tiramani shows off a room built by his company. (Blake Apgar/Las Vegas Review-Journal)
TI/Mirage Tram reopens
The tram that shuttles guests between TI and Mirage reopened this week after being closed for much of 2018.
Las Vegas Convention Center expansion taking shape
Renderings and actual footage show how the Las Vegas Convention Center is evolving.
Former Starbucks CEO Howard Schultz at Las Vegas convention
Former Starbucks CEO and potential presidential candidate Howard Schultz spoke at the Epicor Insights user conference at Mandalay Bay Convention Center Wednesday, April 17, 2019. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
Drew Las Vegas to open in the second quarter of 2022
The 67-story Drew Las Vegas is slated to open in the second quarter of 2022 at the north end of the Las Vegas Strip. (Michael Quine/Las Vegas Review-Journal)
NAB Day 1 (Time Lapse)
NAB kicked off at the Las Vegas Convention Center on Monday, April 8, 2019. (Mat Luschek / Review-Journal)
National Association of Broadcasters Show shows 1mm thick 8K TV with 22.2 channel digital sound
Japan’s NHK Science & Technology Research Laboratories booth featured a 1mm thick 8K TV system used in conjunction with a 22.2 channel digital sound system at the National Association of Broadcasters Show at the Las Vegas Convention Center. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
Nevada shoppers react to Smith’s no longer accepting Visa credit cards
On March 1, Smith’s announced that it would no longer be accepting Visa credit cards at any of its 142 supermarkets, including the 45 in Nevada.
Massachusetts Gaming Commission asks how long Wynn executives knew about misconduct
Business reporter Rick Velotta gives an update on the adjudicatory hearing on the suitability of Wynn Resorts to retain its gaming license in Massachusetts.
Henderson app developer part of Startup in Residence
Henderson based developers of the app On Point Barricade are taking part in Startup in Residence, a North America program dedicated to pairing tech companies with governments. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
Sam's Town employees and customers talk of their love for the iconic casino
Longtime Sam's Town employees and customers love each other and love their casino. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
Las Vegas apartments rents
Las Vegas’ apartment market has accelerated in recent years. Developers are packing the suburbs with projects, landlords are on a buying spree, and tenants have filled buildings.
William Boyd talks about the birth of Sam's Town
On the eve of the 40th anniversary of Sam's Town, William Boyd, executive chairman of Boyd Gaming and son of hotel namesake Sam Boyd, talks about how the casino became one of the first local properties in Las Vegas. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
High Roller observation wheel turns five
The world’s tallest observation wheel celebrates it’s fifth year on Sunday, March 31, 2019. (Michael Quine/Las Vegas Review-Journal) @Vegas88s
Escape Room Industry Growing In Las Vegas
Escapology employees discuss the growing escape room industry in the U.S. and Las Vegas. (Bailey Schulz/Las Vegas Review-Journal)
Impact of parking fees on visiting the Las Vegas Strip
There are no data showing a relationship between Strip resort and parking fees and the number of out-of-state visitors to Las Vegas. But there are data showing a relationship between Strip parking fees and the number of local visitors to the the Strip. ‘’As a local, I find myself picking hotels I visit for dinner or entertainment, based on whether they charge for parking or not,”’ said David Perisset, the owner of Exotics Racing. ‘’It is not a matter of money, more of principle.’’ A 2018 survey by the Las Vegas Global Economic Alliance found 36.9 percent of Clark County residents reported avoiding parking at Strip casinos that charge for parking. 29.1 percent reported avoiding using any services from a Strip casino that charges for parking.
MGM's sports betting deals
MGM Resorts International signed a sports betting sponsorship agreement with the NBA in July It was the first professional sports league to have official ties with a legal sports betting house. The deal came just two months after the U.S. Supreme Court overturned a law prohibiting sports betting in most states. In October, MGM became the first gaming company to sign a sports betting partnership with the NHL. In November, MGM became the first gaming company to sign a sports betting partnership with the MLB. Financial terms of Tuesday’s deal and earlier partnerships have not been announced.
Faraday puts Las Vegas land on the market
Nearly two years after Faraday Future bailed on its North Las Vegas auto factory, the company has put its land up for sale. (Michael Quine/Las Vegas Review-Journal)
El Cortez owner Kenny Epstein on running the iconic property
Kenny Epstein, owner of the El Cortez Hotel in downtown Las Vegas, talks about Jackie Gaughan mentorship and answers rumors about bodies in the basement at the mob-era casino. (K.M. Cannon/Las Vegas Review-Journal) @KMCannonPhoto
LVCVA recommends construction of underground people mover
The Las Vegas Convention and Visitors Authority announced the recommendation for an underground people mover for the convention center. The system would have the potential to expand and connect Downtown and the resort corridor all the way to McCarran. (Michael Quine/ Las Vegas Review-Journal)
THE LATEST
US delays Huawei ban 90 days to give tech sector time to adjust

The United States is delaying some restrictions on U.S. technology sales to Chinese tech powerhouse Huawei in what it calls an effort to ease the blow on Huawei smartphone owners and smaller U.S. telecoms providers.