Apologies, but I'm running late today, so please refresh this page every now and then, as I'll be adding sections to this article all afternoon.
Clean Air Power (LON:CAP)
Share price: 0.33p (down 22% today)
No. shares: 257.3m
Market cap: £0.8m
Just a post-script on this one, it's a micro cap which had promising sounding technology, but it just hasn't worked commercially to date. The company was struggling before the plunge in oil price, but with much cheaper oil, one of the key cost advantages of ts technology (to allow trucks to run on a mixture of diesel and natural gas) has gone.
Personally, I threw in the towel at 4p per share last year, when it became clear that things were not going to happen, and my thinking here on Sep 2014, was that the shares were probably worth nothing.
Update - this was issued yesterday, and makes it fairly clear that the existing shares might end up being worth nothing. Once a company gets to the end of the road, and can't raise any more equity from the stock market, then at that stage its only options are usually deals whereby a new financier ends up owning the whole company, or almost all of it - massive dilution since the only alternative would be Administration.
Every now and then I get sucked into a jam tomorrow stock, and it nearly always ends badly. That's why it's so important to avoid them altogether, if you have the willpower, or if not then to avoid forming an emotional attachment to the share/story, and be willing to pull out once it becomes clear that the future is grim,
Even though I lost about a third of my original investment (in at c.6p, out at c.4p), it could have been a lot worse if I'd hung on, hoping for the best, which is what most people do with jam tomorrow stocks.
As ever, cash is king with jam tomorrow stocks. Another test I usually apply before buying, is to be sure that the company has at least two years' of cash on the balance sheet, at the current rate of cash burn. If it doesn't, then you're running a big risk that the company will come back to the market for more cash, and it's a lottery whether, and at what price, fundraisings…
