A ticker that’s been making noise lately on the OTC is iTokk Inc. (OTC: IKTO). IKTO is one of the last pink current plays and may be one of the penny stocks that will explode. IKTO has seen a flurry of investor activity after verifying its profile this month and dropping its annual reports as recently as September 9th. Lacking sales revenue and funding, IKTO suspended its development and operations in June 2011. However, bullish investors believe there is something in the works for this communication services company.
Speculating that its verified profile and dropped filings indicate iTokk’s intention to go current or sell the shell, investors drove the stock up 150% between September 9th and 10th. iTokk’s shareholders are clearly banking on pending catalysts while waiting for communication from the company.
Despite its past issues, iTokk Inc. has maintained an exclusive worldwide 75 year license to use, sell, market, distribute, and sublicense various telecommunication products. iTokk’s acting CEO, Kevin Elwin Penstock, is the founder of Packetera Communications, Inc. and has held various positions with technology companies. Currently, he is CEO of Water Street Profile Services, Inc. which offers virtual office services and co-working spaces in Vancouver, B.C.
In the past, a LOI was signed between these two companies and if iTokk becomes operational, this could return as a relevant factor. But the company’s website was updated on August 13th to announce the company would be “undertaking all the necessary actions to remove the “Stop” sign from its stock symbol”. IKTO’s management went on to say that it is “currently a shell company with no operations” and that it “will begin the process of strategic repositioning and restructuring”.
A major contribution to IKTO’s rise is the not yet updated OTC market reporting. According to the site, iTokk’s authorized shares are set at almost 50 billion; but in reality iTokk is listed at 2.9 billion AS with the Wyoming SOS where the company was domesticated in 2010. This share reduction dramatically reduces the stock’s float making it an opportune buy before the company becomes current or possibly pursues a merger. IKTO is estimated to have a float of roughly 300 to 400 million which makes the stock especially likely for a runup once the company become pink current or announces its future plans.
IKTO has an outstanding convertible note for $58,000 and unsecured, non-interest bearing debt of $244,677 owed to the company’s president and a company controlled by the president.
While FinTwitter catches on to IKTO’s recent activity, @haadtrading notes the excellent opportunity this has afforded traders with brokers still allowing trading on defunct stocks.
IKTO had a run up beginning September 9th and carrying through to the 10th. This puts its new support line at .0039 and its next resistance at .006. Currently the stock is trading at $.0045. Accumulation is still climbing and has been gaining ground since August. Meanwhile the RSI is at 73 which indicates its shares are overbought. The stock will likely correct soon before another possible runup. On September 9th the stock had a bullish crossover driving the indicator line straight to the upside while the signal line lags behind. At this time there is no sign of a crossover.
Should you Buy?
Given the recent excitement surrounding the stock, its small float, and the advantage to traders using brokers still allowing IKTO to be traded, this may be one of the penny stocks that will explode. In this case this is an opportunity for investors to make short term gains in the impending run up. Back in July the stock reached $.0187 making it possible that the stock could reach such heights again as it becomes current with the OTC.
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