PILGRIM PETROLEUM COM STK USD1 (OTCMKTS:PGPM) Due For A Bounce

On May 23, 2017, we wrote "Pilgrim too cheap to ignore" about PILGRIM PETROLEUM COM STK USD1 (OTCMKTS:PGPM). The share price spiked up after the article was put out, and then went down as market participants sold shares to book some profits. Thus, we believe that a new update on this ticker was necessary. Before we explain the news about this company, have a look at the price chart.SourceRecent DevelopmentsBefore we note the news, let's add some background about PGPM. The company owns "working interests and oil and gas leases throughout the United States", and an interesting balance sheet of "$48.8 million in investments, while only showing approximately $7.2 million in total liabilities". The only warning that we saw in our last article is that the company had been flagged with the “Caveat Emptor” sign. We checked the OTC Markets’ website again to write this update, and saw that the sign is still there.On June 8 ,2017, the market got to know that certain investors had given $3.0 million to PGPM.What's the money intended for?According to the release, the funds will be used for commencing the production of some fields, and acquiring new working interests. These were the most important words:

"The new capital commitment will allow the Company to start production on our non-producing properties, acquire additional mineral rights and secure additional working interest. This year we expect will bring transformative changes to our Company, both on the corporate and strategic front. One of our most important tasks is to allocate capital to the most compelling opportunities." Source

Additionally, the Q1 2017 earnings report was released on May 17, 2017. The most interesting part was the net income reported; $559,960.New disclosures and conversations with OTC MarketsWe were glad to find several documents on the OTC Markets’ website indicating certain information that the company had not provided to the exchange. As we mentioned in many articles, sometimes issuers hold conversations about their businesses with the OTC Markets exchange and the “Caveat Emptor” sign is removed. For the moment, the company has not obtained it, but it seems that they are working on it. This is good news. These are the documents that we found:

• May 25, 2017 - Supplemental Information: It includes information about the CEO, and the company directors, information about the issuer's facilities, the number of total shares outstanding, which is 1,152,459,514, and other relevant information for the exchange.
• June 1, 2017 - more supplemental information

In addition, we found this letter from the company's attorney, wherein all the documents given by the company were explained. In the letter, it is noted that the company believes that it has given all the due documentation:

"Pink OTC is entitled to rely upon this letter in determining whether the Company has made adequate current information publicly available within the meaning of Rule 144(c)(2) of the Securities Act of 1933." Source

Market ReactionThe new information that the company provided to the exchange should have made the share price jump as the “Caveat Emptor” sign may be removed soon. The market did push up the price a bit, but the returns were not extraordinary. It seems that the market preferred to act with great caution, and only a few market participants bought shares. Have a look at it:SourceIs this a catalyst?Yes, the removal of the sign may cause short sellers close positions on the stock, which could push up the share price. Additionally, the market participants who appreciated the balance sheet situation of the firm may find another opportunity to purchase shares. Once again, we recommend investors to stay vigilant on this ticker.Institutional HoldersOn the top of it, we found the following institutional holder on the Nasdaq Shareholders website:Owner NameDateShared HeldChange (Shares)Change (%)Value (in 1,000s)NORTHCOAST ASSET MANAGEMENT LLC03/31/2017100,00000.001

Source

ConclusionWe found very good reasons to study PGPM. In addition to the strong financial shape of the company that we noted in our previous piece, the company is sending documents to OTC Markets to obtain the removal of the “Caveat Emptor” sign. A lot of new regulatory information was given, and PGPM's lawyers noted in a letter that the company was in compliance with the Securities Act of 1933. In addition, the company noted that it had received $3 million to fund its operations, which is great news. These investors seemed to trust the company's operations after all. To sum up, try to be alert on this name, as the stock has proven to be quite the runner. We will be updating our subscribers as soon as we know more. For the latest updates on PGPM, sign up below!Disclosure: We have no position in PGPM and have not been compensated for this article.