Cascadia Investments Inc. (Other OTC: CDIV.PK)
Contact Information:
Cascadia Investments, Inc.
1702 6th Avenue
Tacoma, Wa 98405
http://www.cascadiainvestmentinc.com
Phone: 253-383-7194
E-mail: cascadia@blazemail.com
Business Description:
Cascadia Investments Inc. (CDIV.PK) is an internet development company with a recent focus on the gaming business. The company operates out of Tacoma,Washington. Cascadia Investments Inc. also is concentrating on growth through acquisition and development of social media and other web based business. Cascadia Investments Inc. was formerly Freshstart Properties, Inc. until 12-07. They operated as a real estate development company with a focus on undervalued properties for lease and resale. Freshstart Properties Inc. was incorporated in 2003. On June 4, 2008 a 1 for 8 reverse split was consumated.
Industry/Comparable Companies:
Zynga (Privately Held) ; Crowdstar (Privately Held) ; Farvista Interactive (FVSTA: OTCBB) and Amico Games (AMCG: OTCBB)
Management:
Nazir Maheralli- President, Chief Financial Officer, Secretary and Treasuer.
Analyst Consensus:
No Coverage
Technical Analysis:
Cascadia Investments Inc. (CDIV.PK) is currently trading a above both the 50 and 200 day moving averages.
The shares have pulled back, but still remain in a bullish uptrend.
Potential Catalysts:
Cascadia Investments Inc. has a cult like following and offers tremendous liquidity to short term penny stock traders.
Cascadia Investments Inc. can potentially use it’s relatively high market cap to make quality acquisitions.
Cascadia Investments Inc. is using a shotgun approach to iPhone Apps with the purchase of 18 different game applications. Monetizing even one could be tremendously profitable for Cascadia Investments Inc.
Several unsubstantiated naked short position size rumors have circulated through the penny stock trading community. With that being said, Cascadia Investments Inc. does remain on the short squeeze radar for many traders.
While unlikely, Cascadia Investments Inc. can potentially trade in sympathy with other companies that are profiting from iPhone and iPod touch Apps.
Industry estimates for the Social Gaming Industry could be as high as 15 billion by 2015 according to Mark Pincus, founder and CEO of Zynga. ThinkEquity Partners estimate is lower, but they still feel that the space could generate over $2 billion in revenue by 2012.
80% of iPhone and 50% of Facebook’s 400 million users have downloaded an App or game.
According AdMob’s Mobile Metrics report for January 2010, iPod touch users download Apps 37% more often than iPhone users. The iPod touch also attracts a younger audience than the iPhone. 78 percent of iPod touch users are below 25 years old.
Industry leader Zynga has been valued between 3-5 billion dollars.
Consolidation in the social gaming space is relevant. While Cascadia Investments Inc. has been slow in monetizing their web properites, many other companies have benefited from high valuations. Electronic Arts bought rival Playfish last November for $275 plus. Playdom raised $43 million from private equity firm on a $260 million pre-money valuation. Microsoft, who hasn’t established a major presence yet in the online gaming market recently signed an agreement with Zynga to use it’s online properties on MSN and Windows Live Messenger. Microsoft has also been rumored in buyout talks with Crowdstar, the developer of “Happy Aquarium”.
As noted above, Cascadia Investments Inc. has announced that they intend to apply for an OTC Bulletin Board listing. Shares of companies often rise in anticipation of a move from the OTC Pink Sheets to the OTC Bulletin Board. A listing on the OTC Bulletin Board often offers more liquidity to investors and shows financial transparency to skeptics.
Potential Risks:
Potential dilution exists. Cascadia Investments currently has plans to issue an additonal 3.5 million shares.
Lack of R&D exists as Cascadia has failed to develop any proprietary products and solely grows through acquisition and licensing.
Lack of earnings transparency exists. Cascadia Investments Inc. currently has unaudited financials and have not reported since the end of the last fiscal year (12/31/09).
Cascadia Investments Inc. has been viewed as purely a trading vehicle because of the lack of revenues, cash, assets and it’s lofty market cap.
Cascadia Investments Inc. has not yet successfully monetized a single web property.
Cascadia faces tremendous tremendous competition and the shares are priced at a substantial premium to it’s assets and revenues.
As of 12/31/09 unaudited results of Cascadia’s balance sheet shows only $4694 in cash.
Fresh Harvest Products Inc. (OTCBB: FRHV)
Fresh Harvest Products, Inc. (FRHV) is a developer of brands and a marketer of organic and natural food and beverage products. Fresh Harvest sells its products to consumers through local, regional and national supermarkets, retailers, distributors, brokers, wholesalers and an online Web-store. Wings of Nature, LLC, formed in August 2009, is a wholly owned subsidiary of the Company. The Company’s products include fruits, vegetables, beverages, dairy, supplements, fibers (linen and clothing) and personal care products. The Company focuses on finding, developing and selling the organic and natural food and beverage products in the world. In March 2010, the Company completed its asset acquisition of AC LaRocco Pizza Co.
Analyst Opinion
No Consensus at This Time
Investment Highlights
FRHV engages in the development, marketing and sales of organic snack products and beverages within the United States. Products offered include health bars, coffee bars and salsa under the Wings of Nature name; and beverages under the TeAloe name. The Company distributes its products through branded retailers, supermarkets, distributors, wholesalers, brokers and an online store.
On April 12, the Company announced that sales of its Wings of Nature bars distributed to Walgreens has been “brisk,” and that the Company has received numerous reorders from the Deerfield, Ill.-based super chain of drug stores. The Wings of Nature bars are presently sold in approximately 200+ Walgreens in the greater Orlando, Florida area.
On March 29, 2010, the five (5) creditors of the Company and/or their assignees converted a portion of the principal amounts of certain notes for a total amount of $385,943 into 50,122,544 restricted common shares at an average per share price of $0.008.
On March 29, 2010, the Company issued 7,295,060 restricted common shares for financial consulting services to the Company at a per share price of $0.0096. The Company will account for this transaction as a consulting expense. As a result of these conversions and the share issuance, the Company has 200,000,000 outstanding shares of common stock, which is all of the common shares that the Company has authorized.
On March 3, the Company completed the acquisition of AC LaRocco Pizza Company, which distributes organic and natural foods to retailers Kroger, Albertsons and miscellaneous outlets. AC LaRocco Pizza is a 12-year-old company with $1.5 million in sales in the latest reported year.
On December 16, 2005, the Company bought Fresh Harvest Products Incorporated and began operations following the acquisition, which included the development of an organic food business in the United States.
The Company’s business plan is to develop proprietary products to distribute through appropriate outside U.S. retail outlet chains. Its products include organic snacks not containing refined sugar, cholesterol or trans fats, are low in sodium, and gluten free. These select products are produced in South America and Africa.
The Company’s mission is to offer good-tasting, healthful and affordable organic foods to the mass market. The products are now available in select supermarkets throughout eastern United States.
The Company’s primary focus is to expand its network of retail outlets and to raise capital to facilitate growth through established distribution channels and through acquisitions.
To date, revenues have not reached a level necessary to cover fixed expenses, with net losses and negative cash flows incurred during each quarter since the Company’s inception. Losses are expected to continue in the foreseeable future, according to a Company statement contained in latest Securities and Exchange Commission 10-Q filing of March 22, 2010.
As of the close of the first quarter ended January 2010, the Company reported current assets of $64,758, including $1,474 in cash, accounts receivable of $25,823 (net) and product and other inventory of $37,461.
Liquid assets are not sufficient to continue operation in the coming 12 months, according to a statement by management in the March 2010 10-Q. Therefore, the Company will be required to raise additional capital through a combination of additional stock offerings, long-term and/or short-term financing to continue product development, marketing, advertising, sales, administration and expansion of its products and distribution.
Technical Analysis
According to the RSI which is currently at 92.65% and above the critical level of 70, FRHV is overbought. While a stock that is overbought may continue to rally, investors should be especially careful.
FRHV’s recent volatility has been greater than normal. This is evidenced by the increased distance between the upper and lower Bollinger Bands.
FRHV is trading above its 13 day moving average. This is considered to be the sign of a bullish trend.
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