Camber Energy (NYSE:CEI) stock has added 25% in the last month, but don’t let that blip fool you. This is a sotk that’s nothing but trouble.
The company claims it can make billions of dollars from capturing carbon dioxide from gas wells and selling it to clean the air.
This sounds like a great thing, but it will take a lot of capital to do it, assuming it can be done at all. The thing is, capital is one thing that Camber Energy doesn’t have, and that’s a real drag on CEI stock.
That’s where you come in. CEO James Doris has been running a video log giving investors an “inside view” of his company’s efforts.
He also has, or had, an ally in Zack Morris, a popular financial tweeter who specializes in penny stocks. Morris’ profile picture shows him wearing a crown.
At one time Morris thought CEI stock was a great thing. Camber stock went up, to as high as $3.82/share. There were reports Morris thought it could go to $10. It couldn’t. It trades today at about $1.20
A Closer Look at CEI Stock
Our Larry Ramer has also been intrigued by Camber Energy. He noted that Camber bought a controlling interest in Viking Energy (OTC:VKIN), an oil and gas producer.
Oil and gas prices have been rising. Camber also claims to have a license for “carbon capture” technology from ESG Clean Energy System, which is described as something of a miracle. (I read it several times and still can’t figure it out.)
Then there’s Zack Morris and the Reddit crowd. Reddit has proven it can move stock prices. Morris apparently was intrigued as well. CEI stock moved higher.
Also, short-sellers can drop a stock’s price as fast as Reddit can boost it. A short seller called Kerrisdale Capital issued a report on Camber in October.
Kerrisdale called Camber a “boondoggle,” a failed oil producer that hasn’t filed reports with the Securities and Exchange Commission in a year. Kerrisdale said Viking is also a boondoggle.
Kerrisdale’s report sank Camber’s stock, despite ESG’s protests. Lawyers jumped in seeking clients to launch class action lawsuits, and that’s pretty much where we are.
The Penny Stock Game
The penny stock game has been around for a long time. I covered it in my early 20s when the action was on the old Vancouver Stock Exchange.
The action has moved but the game is the same. Stocks with a thin float and a low market cap are easy to manipulate.
CEI has a market cap of about $360 million, which fits the modern definition. This means they can go up, or down, based on nothing more than a promoter saying buy, then selling himself.
The role of reporters in this is to look at such opportunities and, if we don’t like them, to warn investors away. Our Joseph Nograles did that on Oct. 29, a week after Ramer said he was intrigued. Around the time of Ramer’s report, our Faisal Humayun also wrote up CEI as one of 7 Robinhood favorites he wouldn’t touch with a 10-foot pole.
The Bottom Line
I’m an old reporter and a small investor. My job is to find stories about real trends that you might make money from.
When I was a young reporter, oil was the gating factor to growth. It no longer is. Even if oil prices are spiking today, they’re going to retreat. Renewable technologies are cheaper, electric cars are coming.
When someone says they have a hot new technology for me involving oil, I walk away. I also walk away when someone with a crown on their head in their profile says they have something for me.
I find this a good rule to follow. I’m not always successful in avoiding promoters, but if I can warn you away from a few I’ve done my job. Stay away from this one.
With only the rarest exceptions, InvestorPlace does not publish commentary about companies that have a market cap of less than $100 million or trade less than 100,000 shares each day. That’s because these “penny stocks” are frequently the playground for scam artists and market manipulators. If we ever do publish commentary on a low-volume stock that may be affected by our commentary, we demand that InvestorPlace.com’s writers disclose this fact and warn readers of the risks.
Read More: Penny Stocks — How to Profit Without Getting Scammed
On the date of publication, Dana Blankenhorn held no positions in any companies mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Dana Blankenhorn has been a financial and technology journalist since 1978. Just in time for the holidays he has a collection of COVID-19 stories https://www.amazon.com/Bridget-OFlynn-Virus-COVID-19-Pandemic-ebook/dp/B09K8PSQC8/ at the Amazon Kindle store. Write him at danablankenhorn@gmail.com or tweet him at @danablankenhorn. He writes a Substack newsletter, Facing the Future, which covers technology, markets, and politics.
