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DRNK: Fool's Paradise

The Luke Zouvas connection means that Noho, Inc. is likely going to make even more money spontaneously combust

November 28, 2016: The combination of a share retirement and the announcement of a plan to enter the marijuana industry have sent shares of Noho, Inc. (DRNK) on a climb from the doldrums of $.0001 to the lessor doldrums of $.0008. The climb, while perhaps remarkable in percentage increase over the last week, is negligible when considering the pounding shareholders have taken over the last few years.

DRNK - 3 Year Chart
Believers in fairy tales have chosen to focus on the 2.5 billion share cancellation rather on the fact that there is still 3,655,216,110 shares outstanding. Long term investors might want to consider DRNK's propensity to churn out certificates at an alarming rate. The November 2014 quarterly filing reported that there were only 19,368,829 shares issued and outstanding. A mere two years later, there were 6,155,216,110 shares, a whopping increase of 31,600% percent. Two billion of these new shares were created just in the last two months.

DRNK's financials are rather suspect. The most recent financials, filed on November 17, 2016, report revenues of $4,000,000 all credited to distributorship revenue that we suspect is phony. Our suspicions of hocus pocus are supported by a report of zero cash on hand in spite of the fact that the revenue windfall supposedly led to a net income of $3.6 million. Even with the $2 million listed as receivable, shouldn't there be some cash in the bank or at least some sort of similarly valued tangible asset?

Notably absent from the revenue report is any sales of its Hangover Shot, a formerly popular scheme for selling stock. Perhaps the most notable hangover cure scheme is that of Hangover Joe (HJOE) a now delisted issuer that screwed over those members of the public that did not heed our warnings. While DRNK reported about $610K in sales during the previous year, no sales have been booked for the recently reported year in spite of plenty of inventory on the company's books. That should raise any astute investor's antennae.

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None of this nonsense is a surprise however, considering the involvement of pump and dump superstar attorney, Luke Zouvas, who has represented, if not been directly involved, with many shady deals in the penny markets. He is currently answering to charges from the SEC for market manipulation. Luke's involvement makes the stench emanating from DRNK all the more putrid.

   » Related: Prominent Pump & Dump Attorney Luke Zouvas Charged by the SEC forMarket Manipulation

DRNK may have a bit more upside, but make no mistake; this is a scam and even if the company manages to pretend to find a way into the marijuana industry, the main focus is to make insiders money. The retirement of shares is merely a shell game, as the currently listed liabilities of almost $800K will lead to the regeneration of certificates representing billions of new shares. And then there is the looming probability that current buyers will be reverse split out of there positions. It's probably safest to consider this game played out, at least until then.