When I last spoke of MYM Nutraceuticals Inc. (OTCQB:MYMMF) (TSXV:MYM), the stock was doing well. The company had recently announced its submission for a license from Health Canada to start producing its own THC and CBD products and things were looking up. The company stock had increased by 21% on December 20 and for several days after the stock was hovering in the $3 range, at times even closing in on $4. But now the stock has taken a sudden plunge, so, what happened?
Currently, MYM is trading at $2.18, which puts it down $0.84, or 27.71%, from Thursday’s closing price of $3.02. So what exactly happened to make the stock drop by nearly 30%? What went wrong?
My first thought was that it wasn’t approved for the license. That would definitely cause a drastic fall in MYM’s stock. But after a quick look, this doesn’t look to be the case. There has been no news yet on whether or not MYM has received approval from Health Canada to start selling its THC and CBD products (which means MYM stock could still either recover or drop further based on this decision). That means something else is going on with the company that has caused it to lose the traction it was starting to grip.
What was announced today was that MYM would be starting an ASDP, otherwise known as an automatic securities disposition plan. Essentially, what this is is a plan or agreement to automatically sell insider-held securities of a company on a predetermined schedule (such as quarterly or bi-annually).
MYM’s ASDP will be selling common shares of the company currently held by insiders to the open market for up to two years. Although, in accordance with the ASDP, those insiders who do sell their shares are not doing so because of any negative assessment of the company, the mere act of doing so, or even announcing that it is to be done, does seem to be negatively affecting the company. Perhaps outsiders are questioning why MYM would start an ASDP now and are second guessing any previous assessments they may have made of the company beforehand. Are insiders selling their shares of MYM for any particular reason? Maybe not, but it does seem to be causing others to be wary of the company now. After all, it did drop nearly 30% after doing so well.
Featured Image: twitter
