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Harbor Diversified Inc (OTCMKTS: HRBR) Air Wisconsin RM; the Wholy Grail of Reverse Mergers – Anatomy of a MicroCapDaily 1,000% Winner

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Harbor Diversified Inc (OTCMKTS: HRBR) is an exciting stock that loves to make huge moves and massive gains for its shareholders. June has been an exceptionally explosive month as the stock has nearly doubled to $3 from its $1.50 lows back in May. Mircocapdaily was there the moment HRBR started to run back in November of last year stating on November 10, when HRBR was priced at $0.26 per share: “Harbor Diversified Inc (OTCMKTS: HRBR) is making an explosive move up the charts on a massive surge of volume quickly emerging as among the most exciting stories in small caps. HRBR is quickly getting noticed by top traders and the stock has exploded northbound off its $0.05 base. HRBR is listed as dark/defunct on OTCMarkets Group however the Company’s filings are up to date with a recent 10Q and 10k filed. HRBR is doing spectacular numbers thanks to Air Wisconsin Airlines recently reporting $67 million in revenues for the 3 months ended March 31, 2020 as well as $4.4 million net income for the quarter. 

As we have been saying for a while now reverse merger plays can be more explosive than biotechs when the incoming Company has real value but is undiscovered to investors as was the case when Air Wisconsin quietly took over the HRBR shell late last year. Air Wisconsin owns and operate a fleet of 64 CRJ-200 regional jets and solely serve United Airlines. It’s the 8th largest regional airline group in the US. It flew 4 million passengers in 2019 and operated routes in 36 cities serving solely to United Airlines (NASDAQ:UAL). Seeking Alpha has recently reported on the Air Wisconsin RM stating on the Company’s financials: Harbor Diversified generated revenue of $185.9 million in 2020, dropping 30% from 262.61 in 2019. This was primarily due to Covid. Q1 2020 revenue grew 9% (just before the Covid hit) relative to Q1 2019. Net earnings were $39.7m; however, on a like-for-like basis, if you deduct the CARE ACT payroll support program of $42.2 mln, which was used to facilitate wages – the company was in a net loss. The company will be getting $60mln in support from the government till 2022. Even during a pandemic, the company was able to generate a 14.5% EBITDA margin and unleveraged Free Cash flow Margin of 11.6%. The company has $130.4 million in cash and a net cash position of $6.8 million after paying all debt as of end-2020. It also has $19.1 million of deferred tax assets. 

Air Wisconsin Airlines (@airwisconsin) | TwitterHarbor Diversified Inc (OTCMKTS: HRBR) is the parent Company of a consolidated group of subsidiaries, including AWAC Aviation, Inc. which owns and operates Air Wisconsin Airlines LLC; a regional air carrier that, as of December 31, 2019, provided scheduled passenger service to 81 cities in 31 states with an average of approximately 284 daily departures under an agreement with United Airlines, Inc.. Harbor Diversified, Inc. is also the direct parent of three other subsidiaries: (1) Lotus Aviation Leasing, LLC which leases flight equipment to Air Wisconsin, (2) Air Wisconsin Funding LLC which provides flight equipment financing to Air Wisconsin, and Harbor Therapeutics, Inc. which is a non-operating entity with no material assets. s of May 31, 2020, Air Wisconsin employs around 1,308 full-time employees and 24 part-time employees, of whom 1,057 were represented by unions, and the remainder were not. Air Wisconsin has never been the subject of a labor strike or labor action that materially impacted its operations.

W6390 Challenger Drive, Suite 203 • Appleton, WI 54914-9120 Phone: 920-739-5123 • Fax: 920-739-1325 Manager, last fall.Air Wisconsin operates a fleet of approximately 64 CRJ-200, 50 of which are owned by the Company and the rest are leased. The Airlines has a significant presence at both Chicago O’Hare and Washington-Dulles, two of United’s key domestic hubs. All of Air Wisconsin’s flights are operated as United Express pursuant to the terms of the United capacity purchase agreement.  The CRJ-200 regional jet offers many of the capabilities and amenities of larger commercial jet aircraft, including flight attendant service, a stand-up cabin, limited overhead and under seat storage, a lavatory and a galley that allows for in-flight snack and beverage service. The CRJ-200 regional jet has a speed comparable to larger aircraft operated by major airlines and has a range of approximately 1,585 miles.

 

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HRBR

The Company’s business strategy consists primarily of serving United and its customers through Air Wisconsin’s provision of regional airline services. We strive to serve as an efficient and reliable provider of flight services to United and to provide a high level of service to United and its customers in accordance with the United capacity purchase agreement. The Company also seeks to maintain a competitive cost structure. We focus on a disciplined cost control approach through responsible outsourcing of certain operating functions and diligent control of corporate and administrative costs, implementing company-wide efforts to improve our cost position.

On January 17, 2020, the Company completed an acquisition from Southshore Aircraft Holdings, LLC and its affiliated entities of three CRJ-200 regional jets, each having two General Electric engines, plus five additional GE engines.  On May 22, 2020, Air Wisconsin acquired eight additional CRJ-200 regional jets in a single transaction for an aggregate purchase price of $3.0 million. Air Wisconsin had leased each of these regional jets prior to the acquisition.

On June 1, 2020, Bombardier consummated an agreement with Mitsubishi Heavy Industries, Ltd. pursuant to which Mitsubishi purchased Bombardier’s regional jet program, including all aspects of the CRJ-200 regional jet, including type certificates, maintenance, support, refurbishment, marketing and sales activities. Air Wisconsin does not have any existing arrangements with Bombardier or Mitsubishi to acquire additional aircraft.

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Harbor Diversified is an exciting stock that loves to make huge moves and massive gains for its shareholders. June has been an exceptionally explosive month as the stock has nearly doubled to $3 from its $1.50 lows back in May. Mircocapdaily was there the moment HRBR started to run back in November of last year stating on November 10, when HRBR was priced at $0.26 per share: “Harbor Diversified Inc (OTCMKTS: HRBR) is making an explosive move up the charts on a massive surge of volume quickly emerging as among the most exciting stories in small caps. HRBR is quickly getting noticed by top traders and the stock has exploded northbound off its $0.05 base. HRBR is listed as dark/defunct on OTCMarkets Group however the Company’s filings are up to date with a recent 10Q and 10k filed. HRBR is doing spectacular numbers thanks to Air Wisconsin Airlines recently reporting $67 million in revenues for the 3 months ended March 31, 2020 as well as $4.4 million net income for the quarter.  As we have been saying for a while now reverse merger plays can be more explosive than biotechs when the incoming Company has real value but is undiscovered to investors as was the case when Air Wisconsin quietly took over the HRBR shell late last year. Air Wisconsin owns and operate a fleet of 64 CRJ-200 regional jets and solely serve United Airlines. It’s the 8th largest regional airline group in the US. It flew 4 million passengers in 2019 and operated routes in 36 cities serving solely to United Airlines (NASDAQ:UAL). Seeking Alpha has recently reported on the Air Wisconsin RM stating on the Company’s financials: Harbor Diversified generated revenue of $185.9 million in 2020, dropping 30% from 262.61 in 2019. This was primarily due to Covid. Q1 2020 revenue grew 9% (just before the Covid hit) relative to Q1 2019. Net earnings were $39.7m; however, on a like-for-like basis, if you deduct the CARE ACT payroll support program of $42.2 mln, which was used to facilitate wages – the company was in a net loss. The company will be getting $60mln in support from the government till 2022. Even during a pandemic, the company was able to generate a 14.5% EBITDA margin and unleveraged Free Cash flow Margin of 11.6%. The company has $130.4 million in cash and a net cash position of $6.8 million after paying all debt as of end-2020. It also has $19.1 million of deferred tax assets.  Microcapdaily first covered HRBR to the investment community when it was $0.26. We will be updating on HRBR when more details emerge so make sure you are subscribed to Microcapdaily so you know what’s going on with HRBR.

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Disclosure: we hold no position in HRBR either long or short and we have not been compensated for this article.

Media & Technology

Global Tech Industries Group Inc (GTII) rally could be just getting started

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Small-cap stocks have seen a significant increase in the first weeks of January, a trend that is often seen at the start of a new year. This presents an opportunity for investors to capitalize on the surge before it dissipates. The Russell 2000 index, which follows small-cap stocks, has shown a 7.4% increase as of Monday’s close, outperforming the large-cap Russell 1000, which has risen by 5%, and the S&P 500, which has increased by 4.5%.

The “January Effect” rally, where small caps surpass large caps, is a common phenomenon. One such stock that may be benefitting from this January effect is GTII. Global Tech Industries Group Inc (GTII) last traded at $1.86 and closed with double-digit gains of 11.08%.  GTII has a 52-week range of $0.4302 – $8.9700, suggesting a tremendous upside potential from the current levels.

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What caused the surge in GTII share prices?

For the uninitiated,  Global Tech Industries Group, Inc. (OTCQB: GTII) is a Nevada-based public company focused on acquiring cutting-edge technologies. Last week, GTII announced Board appointed Donald Gilbert to lead a newly created task force that will investigate illegal trading in GTII’s shares. The task force will be responsible for examining and assessing the possibility of illegal and deceptive trading practices by various market players, including market makers, brokers, and hedge funds. In addition, the task force will also advise the Board on potential legal actions against market participants suspected of engaging in unlawful trading activity concerning GTII’s shares. Based on its initial assessment, the task force will also advise the Board on presenting evidence of potential illegal trading activity concerning GTII’s shares to relevant government and regulatory agencies. In essence, Mr. Gilbert will lead the efforts necessary for safeguarding the interests of GTII’s shareholders.

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Creatd, Inc.(OTCQB: CRTD) announced today that it had extended the no-shop period in its Letter of Intent with Global Tech Industries Group, Inc. (GTII) for its planned acquisition. Although there’s no guarantee a deal will be reached, both firms continue to evaluate the deal through due diligence, and Creatd is exploring a collar structure to potentially value its shares at $3.00 to $5.00 per share.

It would be interesting to see if GTII news gets picked up by retail investors causing a further surge in stock prices. We will update GTII when more details emerge, so make sure you are subscribed to Microcapdaily to know what’s going on with GTII.

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Disclosure: we hold no position in GTII either long or short and we have not been compensated for this article

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Good Vibrations Shoes Inc. (OTCMKTS: GVSI): The OTC Stock To Own In 2023?

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Good Vibrations Shoes Inc. (OTCMKTS: GVSI) is perhaps the most-talked-about OTC stock to kick off 2023 as a George Sharp reverse merger penny stock.

Good Vibrations Shoes Inc. (OTCMKTS: GVSI) is perhaps the most-talked-about OTC stock to kick off 2023 as a George Sharp reverse merger penny stock. Many say they won’t sell for less than $.50 a share. They are banking on reverse merger whiz George Sharp to deliver the goods like he did when TSNP merged with HUMBL Inc. (OTCMKTS: HMBL).

As everyone knows, George Sharp is the stock whizz behind some of the biggest runners in recent penny stocks history, including the great TSNP and FORW, which also went from under a penny to $1 plus. For the past 17 years, George Sharp has been a consultant to companies in various contexts, including software development, assisting public companies with growth and regulatory compliance plans. In June 2017, Mr. Sharp was engaged as a consultant by OTC Markets Group, Inc. to develop compliance processes to bring more timely and actionable data to the OTC market. Working with OTCMarkets Group as a consultant for many years gives GS a considerable advantage, and if anyone can make things happen with GVSI, it is George Sharp. 

Reverse mergers can be more explosive than biotechs when the incoming Company has real value but is undiscovered to investors, and many RM stocks that we have covered on this website have gone from pennies to dollars. Microcap Daily was one of the first on the scene as TSNP was taking off, reporting on the stock on November 15, 2020 when TSNP was trading at $0.003, stating at the time:

“TSNP is making a spectacular run up the charts in recent weeks, quickly transforming into a volume leader and one of the top most traded stocks in small caps. TSNP started in triple zero land but has gone parabolic since then, quickly attracting legions of new shareholders who continue to bid the stock higher. Reverse Merger stocks (RM) are easily among the most exciting and explosive stocks in small caps rivaling only biotechs in their ability to make historic gains. TSNP is the perfect merger candidate; a clean shell with virtually no debt, and the new Company HUMBL is a major mobile payments player with a first-class management team with team members coming from companies like Western Union, Moneygram, Visa, American Express, Epson, Microsoft, Facebook and Qualcomm and was recently named a Forbes “Rising Startups to Watch” The merger is being shepherded by well-known OTC Markets analyst George Sharp, who brought the parties together and has provided valuable advice on strategies and compliance to complete the transaction.” We concluded, “The whole deal is being shepherded by George Sharp, a reverse merger whizz and someone known for doing it right.”

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Good Vibrations Shoes Inc. (OTCMKTS: GVSI) is a Nevada corporation, formerly known as Bitcoin Collect, Inc., Solpower Corp., Virtual Technologies, Inc., and Dynafuel Corporation, which was incorporated under the laws of the State of Utah on June 7, 1982. The Company is a perfect reverse merger candidate with a clean balance sheet of just $250k in liabilities.

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GVSI

Latest Updates

GVSI should be Pink Current any day now. The Canadians that sold after GVSI came off the Expert Market will be buying back in. Savvy investors that picked up cheapies under $.025 will be rewarded.

GVSI has also filed to cancel shares.

We also have this agreement between GS and GVSI. These are the shares that, on August 29, 2021, in recognition of the $50,000 cash invested and $50,000 in consulting fees accrued by George Sharp for professional and regulatory costs to reinstate the registrant in the State of Nevada and to have the registrant become current in its filings under the SEC’s recently imposed requirements for public companies operating under SEC Rule 15c2-11, the Board issued 300,000 shares of the authorized “blank check” preferred stock to George Sharp with 10,000 votes for each share of preferred stock to give voting control to Mr. Sharp.

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GVSI represents the highest risk-reward in the OTC Markets right now. Some investors have been impatient and sold their shares at these low levels. The key to understanding is that these things take time, TSNP took a long, long time, and GVSI will be all the more exciting. As previously stated, Mr. Sharp was engaged as a consultant by OTC Markets Group, Inc. to develop compliance processes, so if anyone can get it done, he can. Mr. Sharp continues to tweet about GVSI regularly, and it’s listed at the top of his Twitter account. All the uncertainty and bashing have created a unique situation for GVSI; it currently trades under $0.03. If things happen here as GS says they will, this will be one seriously parabolic situation with a massive upside. There are no guarantees on the OTC and no sure thing at all, GVSI is a lottery ticket for sure, but considering GS track record, I would say this is a good ticket. We will update GVSI when more details emerge, so make sure you are subscribed to Microcapdaily to know what’s going on with GVSI.

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Disclosure: we hold no position in GVSI either long or short and we have not been compensated for this article

Image by WikiImages from Pixabay

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CeCors Inc (OTCMKTS: CEOS) Opportunity Mushrooms with Disabled Veterans

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CeCors Inc (OTCMKTS: CEOS) is at heart a mushroom company with products on the shelf that is transforming into a disabled veteran benefits company.  Many have heard of magic mushrooms, psychedelic mushrooms, and psilocybin and their medicinal benefits. One of the biggest consumers of these products is disabled veterans. The core company is PsyKey which is a vertically integrated mushroom company developing medicinal products for healthcare professionals and consumers.  The products come primarily from functional mushrooms that have specific purposes.  Their mushrooms are cleverly mixed with coffee pods as a delivery system that allows people to start their day off right.      

While the company does have modest revenues from the sales of their core products, the sizzle is in the acquisition of VetComm Corp. announced in mid December. The reality was that this binding letter of intent was not taken seriously by market participants until they were beaten over the head with a video with the charismatic CEO of VetComm, Kate Monroe.    

This video outlined her goal of onboarding 1.0 million veterans of the 14 million veterans eligible for disability to get their rating.  If she accomplishes this goal she claims 

“This would put $30 billion per month into the US economy”

The huge problem they are trying to solve is the simplification of the governmental claims process.  These 14 million veterans eligible for benefits simply don’t have the energy to cut through the red tape and get a successful disability rating with the government.  VetCOMM has a seasoned team that essentially handles the rating process for the vets.  All the vets have to do is pay the monthly fee and answer the questions from VetComm.  

1.0 Million Veteran Challenge

Anyone thinking that 1.0 million isn’t attainable is underestimating both the CEO Kate Monroe, a veteran herself from the Marine Corps, and the networking power of veterans. Veterans are a tight knit community.  Think about it some of these vets were sitting in a foxhole and their life depended on their buddy doing his job.  So when these vets sign up for VetComm and get a positive result and then call their buddy up and say trust me you need to do this, there is no waffling around. Vets will listen to other vets.  This video from Randy Couture just shows you a hint of the star power they have behind this company. 

   

The government set aside tens of billions of dollars for disabled veterans but navigating the rating process with the government paper pushers is worse than combat for some of these vets.  They get discouraged and give up, that is where the tenacity of the VetComm team comes into play and knows how to successfully navigate the bureaucratic maze and get results for these veterans. VetComm just takes a flat fee for their service ($247 or $997) and the vets could receive thousands of dollars monthly depending on their level of injury.  There is no reason not to try, and the company has a money back guarantee.  Even more exciting is the back pay some of these vets could receive.  Wait until some of the testimonials go viral.  The website currently has real testimonials from veterans sharing their story of how easy it was to get rated.  The message from VetComm is that there is nothing to lose and almost everyone walks away with something.  

The CEO is a networking guru and has pictures with top politicians and generals all supporting her efforts.  These are top politicians like Senator Ted Cruz, Roger Marshall, Earnest Grassley, John Cornyn, and Deb Fischer. Then there are the celebrity endorsements from Randy Couture, Ken Shamrock, Donald Trump, Jr., Sarah Palin, Matt Thomas of Parmalee, Carl Higbee, and Gretchen Carlson. 

Revenue Estimates

The revenue off of her 1.0 million veteran goal could be $500 million considering that the average fee is about $500 dollars assuming the majority will opt for the do it yourself rating instead of the “Done-For-You” service.  The company has no formal projections but if they do release something it could be a big catalyst. The costs of goods sold on this are marketing and the customer support line.  VetComm is essentially getting a small sliver of the $30 billion monthly pot of money the government has agreed to pay out but hasn’t had to because the veterans haven’t filled out their paperwork.  Kate Monroe is creating a social movement in the veteran community to take what they are owed and not let politicians repurpose those funds for other special interests     

Acquisition Synergy         

There is a sense of community that VetComm is trying to establish.  Many of the vets that suffer from PTSD would be helped by the functional mushroom products.  There is also a planned expansion of the product line that the company alluded to last year.  A natural expansion of the line could mean that other products like gummy bears, capsules, or other delivery systems are introduced.       

Financial Analysis

The company has 332 million shares in the O/S and has 148 million in the float.  The current market cap is sitting at close to $10 million. Since they are an operational company with revenues they had their Shell Status designation removed from OTC Markets.  The company has also openly stated that they are not going to reverse split the stock or take on additional dilution.  This might be interpreted to mean that they won’t exceed the authorized limit of 500 million shares.    

This means the VetComm acquisition is likely to be paid with treasury stock.  In early 2022 87.75 million shares were brought back into treasury and could easily be reissued for the purchase.  This is complete speculation because the details of the acquisition have yet to be released but the bread crumbs lead to a very shareholder friendly transaction.  

Risks

There is a definitive deal to acquire VetComm, but investors are not privy to the terms of the deal. Therein lies the major risk. Investors have no idea how much dilution is possible in the acquisition nor do they know how strong the underlying business is. Dilution would have to be less than the authorized max.  It’s impossible to tell if it’s a good deal or a bad deal, although their comments on social media demonstrate it’s going to be very positive.  Leadership is a question too because there is no CEO at the helm.  The filings show Amar Bhatal is the president and the CEO spot is vacant. While it’s reasonable to speculate that Kate Monroe would be the ideal candidate for CEO, she has no public market experience. If the VetComm acquisition were to fall apart many investors could be holding the bag because the underlying mushroom business has not generated sufficient earnings to support the public listing short term.       

Investor Summary

The volume is just starting to ramp off of what looks like a long term bottom so there doesn’t appear to be much downside at the current stock price and plenty of upside to $.12. The mushroom industry is massive, but a unique opportunity exists in servicing veterans.  VetComm is led by a charismatic CEO who might very well take over CEOS.  Her social media standing suggests that she is going to use digital marketing and the power of veteran networking and endorsements to mobilize the veterans.  This deal can almost be considered a Software as a Service (SaaS) deal as it contains those components.  The goal of attaining 1.0 million veterans by year end could translate into massive revenues in the tens of millions or hundreds of millions with little to no customer acquisition acquisition costs (CAC).  It’s too early to tell, but CEOS is one of those long term fundamental plays that should be held in a speculative portfolio. Should they complete the acquisition and give revenue estimates investors could see long term 12 – 18 month upside up to $1.00 assuming a fully diluted 500 million O/S and $500 million in revenues trading at a multiple of 1X sales. The downside risk is nominal given their rapidly expanding mushroom line that could be cash flow positive on its own this year.  

Disclosure: MicroCapDaily has not been compensated for this article. This post was written by a guest contributor and posted on our website for free. The owners of MicroCapDaily have no position in any of the securities mentioned.

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