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Roller coaster fun on Wall Street—ECIG ltd rises again

Roller coaster fun on Wall Street—ECIG ltd rises again

ECIG Ltd. stock is back up, and rising! On Monday (23 February), the ambitious vaping supplies conglomerate saw a 17.85% spike, which more than made up for a frightening plunge the previous Thursday. One wonders if investors raise their hands and scream on the way down, and are they offered chances to purchase photographs of their horrified faces on exit from the ride.

Share price reached 8.65 cents Monday, on a dollar volume of $831,000, according to Hot Stocked. Perhaps this time the aggressive company's rise will keep on going, as the firm is clearly aiming to position itself as the rising star in the e-cigarette industry, "clean hands" division (non-Big-Tobacco).

Further volatility can be expected, however. It remains to be seen how investors will respond to the proposition of a "reverse split" and a share count increase. The shareholder meeting on that issue is scheduled for March.

In the aftermath of the frightening plunge at the end of 2014, when share price dipped below a nickel, new brass at the company rearranged the management of liabilities, and this seems to have inspired a rise in shareholders' confidence. Aggressive expansion throughout 2014 left the company with considerable debt, but also with an impressive array of new ventures.

Hot Stocked continues to counsel caution, noting that "Thursday’s abrupt and painful drop is certainly proof that the ticker can plummet at any time.... for no discernable reason."

To discern the reason, one may have to look beyond purely financial issues. Stock analysts who look only at the financial picture may be missing important political, medical, and cultural issues that are having an impact on the fortunes of ECIG. The company's clear intent to position itself as the leader of the independent e-cigarette manufacturers, a potential challenger to Big Tobacco, seems to inspire dizzying ambition in some investors, dizzying fear in others. It is easy to see why this situation produces a volatile market.

A brand new factor, one that is bound to have an impact, is the mention of ECIG in the context of the patent wars going on in the vaping supplies industry. Marlboro-maker Altria has just offered little Atlantic Vapors a chance to sell out for a seven-figure sum. It seems that Atlantic owns rights to a "predicate product" -- one that was on the market before February 2007, the current "grandfather date" for FDA applications for new approvals of tobacco products.

Atlantic high-mindedly declined the offer, requiring at the very least an enforceable assurance that non-cigarette-makers would still be allowed to compete in the continuing e-cig market, under new FDA deemings. Atlantic further stated that it would prefer to deal with independents (non-cigarette-makers), rather than with Big Tobacco – and it mentioned ECIG by name!

This is potentially a huge development. Acquisition of a predicate product by ECIG, through a merger with Atlantic or a buyout, would completely change the landscape in the e-cigarette industry. By presenting a feeler in public, Atlantic has thrown down a gauntlet. It offers the possibility that united independent e-cig firms may be able to credibly challenge the Big-Tobacco-sponsored e-cig firms that have proliferated since 2012, as virtually every BT company has bought out an independent company (Blu, GreenSmoke, Dragonite, E-lites, and others). It could spell the end of Big Tobacco's bid to dominate the vaping industry.

This is big news indeed, and information concerning that possibility may well have inspired the current rise in ECIG share prices. And it could keep that rise going.