Finding undervalued gems on the OTC with extremely favorable share structures has long been a delivery system for some good gains, especially when the PPS starts to become too cheap to pass by. Service Team Inc. (SVTE) nearly fits the criteria for one of these type of plays, but with a small bonus to it: positive net income worth 0.01 per non diluted share per the last Q filed.
Given that new 52WK Lows have been logged each of the last 2 trading sessions and that some eager traders who would like to call SVTE a 10-bagger in waiting have already begun placing small bets on it, a closer look within reveals that IF it’s going to run, it’s going to have to happen soon.
Service Team Inc. is a clean OTC set up having never been through any name changes, reverse or forward splits, files with the SEC, and has a very attractive shares structure with just 74 million shares authorized. To ensure that the authorized is still that, a quick check with the Nevada Secretary of State verifies it is still intact.
The company’s last known leased facility is located at a building at 1818 East Rosslyn Avenue, Fullerton, California 92834.
The most recent Q filed January 19, 2016 shows 13,430,624 shares are issued and outstanding. For the 3 month period ended November 30, 2015, Service Team reported having $301,429 in total assets ($22,201 of which was cash) and $285,285 in total liabilities.
Even more attractive is that the Company, which manufactures/repairs truck bodies for hauling dry freight or refrigerated freight, reported quarterly sales of $925,103 v. $553,627 for the three month period ending November 30, 2014. Costs of sales during the quarter barley increased, $639,641 v. $513,383 for the three month period ending November 30, 2014, and with just $183,446 in operating expenses for the quarter, Service Team was able to produce net income during the period of $102,016 ($0.01 per share – no dilutive).
Take those items and wrap them up with a bow and you have a massively undervalued 0.0051 stock that could turn heads and maybe even 10-Bag.
The Company’s sole director is Robert L. Cashman, President of Hallmark Venture Group, Inc. (OTC: HLLK). Cashman has been in the “bagging” game for over a decade with SEC filings showing how, on January 10, 2003, Cashman transferred 270,000 shares of Sealife Corporation (OTC: SLIF) to various individuals.
It’s unknown who Cashman transferred the shares to, but the SEC later busted a group of individuals who engaged in a scheme that defrauded the investing public by using materially false and misleading public statements and manipulative stock trading to create an artificial market for, and to sell, stock in SLIF.
Cashman apparently got hold of this “trucking industry” business model back in 2007 when he sued his buddies in a power grab for it while the business was being used under Auto Max Group Holdings, Inc., now known as Biocentric Energy Holdings, Inc. (OTC:BEHL)
Cashman was slapped on the wrist 2 years ago by the State of California when Service Team was then trying to raise money from investors to import consumer electrical products, including the “Angel Touch Massager,” a small hand-held facial massager. Service Team and its controlling shareholder, Hallmark, “guaranteed” that investors could sell their shares of common stock “for at least $1.00 per share” one year from the date of their investment “or, for $2.00 per share two years from the date of the buyer’s purchase.”
Cashman’s Hallmark Venture Group was once being hailed as an undervalued investment by another OTC listed company, IC Places (OTC:ICPA) back in 2010.
With great filings showing a favorable shares structure and net income per share 2X the current PPS, SVTE having ticked a 52WK Lo Thursday and Friday has generated $8,847 and $7,592 in volume, respectively. A few PM’s were passed around late Friday about SVTE and the running of it: one was about how in the 2’s, the chart be set up nice for a big attention bounce play like PKGM was this past week, the other how some have already begun buying SVTE Thursday and Friday.
What was already filed by the Company were two 13G filings, one for Vis Veres Group Inc., run by Curt Kramer (aka Asher Enterprises with links to KBM Worldwide via his brother) and the other from Tangiers Investment Group, LLC, managed by Michael Sobeck.
Kramer is infamous in OTC Land, while Sobeck’s group has hidden well underneath stocks like Intelligent Living Inc. (OTC:ILIV), Apt Moto Vox Group (OTC:MTVX), Integrated Freight Corp. (OTC:IFCR) and North Bay Resources Inc. (OTC:NBRI).
Besides the two having already filed 13G statements to show their 9.99% holdings from debt conversions, here’s a list of what was on the last Q filing:
Convertible Notes Payable – Third Party
- On July 2, 2015, the Company issued a convertible note to Vis Veres Group for $38,000 of cash consideration. The note bears interest at 8%, matures on April 7, 2016, and is convertible into common stock at 55% of the lowest 3 closing market prices of the previous 20 trading days prior to conversion.
- On July 21, 2015, the Company issued a convertible note to JMJ Financial Group for $27,778 of cash consideration. The note bears interest at 12%, matures on July 21, 2016, and is convertible into common stock at 50% of the lowest 3 closing market prices of the previous 20 trading days prior to conversion.
- On July 15, 2015, the Company issued a convertible note to LG Capital Funding LLC for $26,500 of cash consideration. The note bears interest at 8%, matures on July 15, 2016, and is convertible into common stock at 50% of the lowest 3 closing market prices of the previous 20 trading days prior to conversion.
- On February 5, 2015, the Company issued a convertible note to Tangiers Capital Group for $55,000 of cash consideration. The note bears interest at 10%, matures on February 5, 2016, and is convertible into common stock at 50% of the lowest 3 closing market prices of the previous 20 trading days prior to conversion.
On August 26, 2015, Tangers Investment Group LLC converted $10,000 of its Note into 904,977 shares of common stock (0.011/share).
Within each debt agreement: The Company evaluated the convertible note and determined that the shares issuable pursuant to the conversion option were determinate due to the conversion price floor and, as such, does not constitute a derivative liability as the Company has sufficient authorized shares and a conversion floor of $0.00005.
As can already be witnessed, Market Maker VNDM is in the box on the ask. As long as they stay up there, there is no play to be made. My late Friday chat messages about placing bids in the low-mid .002 range was done in an effort to show some bid support and after having discussed that a play for a flip with volume coming in could be made around there.
Since Vis Veres Group and Tangiers Capital Group already have their 13G filings in, they DO NOT need to re-file as they convert debt into shares at the agreed calculations: (55% and 50%, respectively, of the lowest 3 closing market prices of the previous 20 trading days prior to conversion).
Right now, that “best conversion price” would be in the mid .002 range which makes bidding there less risky at the moment. If these toxic debt converter can get SQUEEZED by a rush of volume hitting it based on the “glossy” look of net income per share, an estimated $3.75 million in annual revenues based on the three months ended November 30, 2015, and the “assumption” most of the debt isn’t convertible until at least April 7, knowing a bit of how dirty this pristine looking SVTE is will help to bag instead of getting bagged if and when volume rushes in.