The tragic decline of Sauer Energy, Inc. (OTC:SENY) continued yesterday as well. The stock tanked further down by 4.60% and closed the session at $0.83 for a share. That looks dramatic on the chart, yet it is actually not that bad as the company still gets an overoptimistic valuation from investors.
There is no news from SENY recently, but the news that managed to push the share price back up above $1 was released on March 9. It said that Sauer Energy has scheduled its wind turbine for formal wind tunnel testing later this month. The company also claims to have contracted with the University of Washington Aeronautical Laboratory in Seattle, Washington, to conduct the wind tunnel testing of its home and small and mid-size enterprise pre-production model.
Interestingly, March 9 was also the date on which the last stock promotion for SENY took place. The cost of $15,000 was paid by a third party. Positive effects were short-lived, but the negative ones hold until today. One of the explanation could be that the stated anticipation in the promoter’s disclosure that the paying third party might be holding shares to dump on the market could have actually happened. There are more reasons for SENY to tank though.
In its press releases, SENY claims to have a revolutionary wind turbine technology that is targeting a million dollar market. Its recent financial reports, however, do not uncurtain the reason for SENY astronomic market valuation. Even after the fall in last two weeks, SENY is still holding the impressive market cap of over $64 million. To justify that, Sauer Energy has total assets for $30,000, half of that in cash, no revenues since inception and no definite material operations.
What SENY did for certain last year was issuing shares of its common. Starting July 2010, the company made a series of private placements with various investors. First SENY issued 800,000 units consisting of a common share and a stock warrant for total proceeds of $200,000. After that the company issued 938,000 units for $234,500.