HMNY Total Garbage Stock- But May Be Cheap

HMNY is a total garbage stock – badly mismanaged with a botched strategy, horrible execution, and totally lame marketing and PR. They have a criminal like CEO who is both stupid and dishonest. They are regularly out foxed and out executed by competitors, and they make it seem impossible to find new productive partnerships.

Add to that that they execute so slowly for a startup you would think they were a 100 year old company.

And finally they have been shedding customers on purpose at a rapid rate. That part is only partly bad. The company was so f’d up they had to fire 1/3 of their customers to stay alive!

Add it all up and this stock is just total garbage and that is why the market pounded the stock to oblivion. I have never seen a bigger shit show for any stock- ever. Pets.com was better than these idiots. Sears was likely better- even into bankruptcy.

All that said – the salvage value of this heaping pile of shit is likely more than the measly $32-34 Million Market Cap range the stock is trading for today.

Rumors of acquisition have been floating. That makes sense. There is value here. Last reported the company had $65M left from its scammathon ATM offering, that now by the grace of god is over. It also slipped out that there are still 2.1 Million suckers still left paying for the almost impossible to use service.

Oh to be fair- I am still a member- and if I use it once a month it has value.

If you value the subs at $30 each (and that’s pretty cheap) that is $60 Million. Let’s say the cash is down to $30 Million left. They probably have at least $10 Million in accounts receivable. That’s $100 Million with zero goodwill and zero value for the tech, patents and TM’s.

A $100 Million buyout is peanuts for any real company. Hell you could just take the cash, milk the subs and give them even shittier service and skim more cash until they all finally quit. It would be worth more than $100 Million.

So yes- this total pile of horse pucky is undervalued as an acquisition target no doubt.

The issue is that this stinker is still run by an idiotic CEO who is a loser, a guy who wants to play in Hollywood with your money. His best asset was that he was able to befriend Mitch Lowe with promises of money to deliver his vision, which of course he could never deliver on. Subsequently, he ruined Mitch’s reputation and drove the entire ship straight into a toxic iceberg.

Will the stock go up from here? Depends on how addicted Ted is to his own crack. He is a big enough sociopath to screw up an acquisition with a poison pill. He does not want to leave his pretend Hollywood job to go back to peddling another loser penny stock. So expect him to continue being a total drag on the stock and a huge impediment to any possible deal. Nobody will want Ted to stick around post an acquisition, even Stupid Ted is smart enough to know that.

So it is no sure thing that any acquisition will happen, but with the price so cheap, and the RS possibly at risk, it could force Terrible Ted’s hand.

Is it worth loading up here? Probably not. Am I selling. No- I am waiting out the 5 years I promised in the past.

Is the Worst Over for HMNY?

There was a very strong market reaction to Ted Farnsworth announcing he had secured $65 Million in “Financing” for Moviepass today. Farnsworth also boasted that Bankruptcy was “off the table”. He continued to state that he is looking for acquisitions and to find new ancillary revenue opportunities.

All this happening at an event called The Grille.

Can we believe Ted this time. Unfortunately, probably not. Ted has proven too many times that he gets confused about what “securing finances” really means. Because the company won’t comment on who, how or why anyone would give them additional financing, it seems very unlikely that there is any new real support. It is possible the company stuck another toxic deal for shareholders with Hudson Bay, and combined with some further dilution from their long running ATM offer they may have $65 Million in the bank. But if the history even rhymes with what we are going to find out about this new round of financing, get ready to find out the worst deal you can imagine for common stockholders. It’s simply the way Ted does business.

If somehow Tee did pull a hat trick and secured a reasonable debt deal, that would be a great thing for the company. I doubt that happened however, as Ted said the company still has no debt. Or maybe they do now? Who knows – this is Ted we are talking about here.

At any rate. The big jump from today is probably NOT going to last, and almost certainly won’t survive another big reverse split. If there is no other news than Ted haplessly announcing more toxic deals with sharks like Hudson, you can forget any long term rally.

If there is new real sound financing. Why would Ted and company not issue an official statement? Why would there be no SEC filing? It makes no sense. Yet nothing at HMNY ever makes sense.

I guess one silver lining. If he does have $65 in the bank now, that is nearly 3X the market capitalization of the company.

Unfortunately, even with all that, Ted will likely find a way to piss that money away faster than you can say reverse split!

I hope I am wrong, history says I am right. I hold my slightly less worthless shares, praying the company will find a way, and get rid of Fraudsworth.