One of the hottest penny stocks buzzing on the social media blogosphere lately is EVSV, Enviro-Serv, Inc.
If you follow us on Twitter @ThePSObserver then you may already be familiar with the ticker and enjoyed a 650% gain in the past two weeks via our affiliate team. But where do we go from here? What’s next? And for those of you who are hearing about EVSV for the first time as you read this email, how can you get in on the action? Or is it too late? Did you miss the boat? Will it continue running higher?
These are just a few of the countless questions traders are faced with on a daily basis. Well, we at the Penny Stock Observer are here to help make answering these questions a little less stressful.
Since our affiliate trade team first began talking about EVSV via Twitter on May 5, 2015, we have seen the price per share increase 650% from $0.0002 to a recent high hit the morning of May 19, 2015, of $0.0015. See the chart below:
For 6 trading days following May 5th EVSV had a resistance level at $0.0006. This resistance was broken on May 13th and a new resistance level was put in at $0.001, which held for 3 days. Then, on May 18th a news announcement issued by the company sent EVSV tearing through the resistance level at $0.001.
EVSV formally signed a franchise agreement with Pestmaster Services, a national Franchisor with 30 locations and a dominant player in the Governmental contracts sector for pest control to control the Tampa Bay Pest market. This is great news for the company as the CEO stated he has aggressive plans to bid on some of the largest Government pest control contracts in the country. This added business model will, according to the CEO, result in an increase in consistent revenue. In a follow up shareholder update, the CEO also mentioned that he expects this to be the busiest year in company history. He added that the Company just posted a record setting April and as such are on pace for a record May. We encourage you to read the recent news announcements and filings issued by EVSV.
Trading Summary (continued)
EVSV has been consolidating nicely on high volume after its 650% move. Typically, stocks tend to pull-back (which is completely normal and healthy after a big move) after making a move of this magnitude, yet EVSV has consolidated above its previous resistance level for two consecutive days. This trading activity is viewed, in our opinion, as a bullish sign and hints that EVSV has not yet lost any of its steam.
Very similar trading action can be seen the two days following EVSV’s break above the $0.0006 resistance level. For the two days following the break, we saw an increase in trading volume as EVSV consolidated above the previous resistance level which had then become support. We are seeing the same type of pattern now that EVSV is above the $0.001 resistance level which is now acting as support.
With the recent news announcement, EVSV is, in our opinion, in the best position fundamentally as it has ever been. The new franchise deal with Pestmaster Services (one of the largest players in the Government contract pest control space) could help Enviro-Serv quickly acquire new GSA (Government Service Agreements) SBA contracts that will eliminate any type of “slow season” experienced by most pest control companies. There are 21,000 pest control companies in the U.S. and only 70 are approved to bid on Government contracts. The new focus on Government contracts could significantly increase company revenues. The Tampa franchise already has a Government contract worth $307k, but Pestmaster believes it may actually end up being worth about $500k through the life of the contract.
EVSV has already made a big move, there is no denying that. But it’s the manner in which it has climbed higher that has us still bullish on this ticker. We are yet to see a blow off extension move also known as an exhaustion move. The climb has been smooth and methodical over the two week period. Anyone shorting this ticker has been run over and we like how resistance has been becoming support after breaking to the upside. This tells us that demand is still high and the new support level is around $0.001. The last time EVSV consolidated above a previous resistance level we saw a 50% move in just two days.
We certainly won’t argue with anyone who wishes to wait for a pullback but also won’t argue with anyone who grabs some before they finish reading this sentence.
Trading action and volume has been consistent as of late, more so than we’ve seen at any other point in time when looking at a longer term chart of EVSV. When looking back, we see several quick, unsustainable spikes followed by just as quick pull backs. But over the last two weeks EVSV has traded differently and this has us quite intrigued. A little over a year ago we saw EVSV hit $0.0037 on strong volume and we believe recent corporate developments put the company in a much better position now rather than the previous move discussed above.
Even though taking profits is always a good idea, especially for those of you who have been following EVSV since May 5th, we expect this to be a longer term story. The recent corporate development with Pestmaster coupled with the favorable price movement and increased trading volume will keep EVSV on our screen for quite some time. And we will most certainly be on the lookout for updates from the CEO regarding Government contracts he is bidding on.
Know your support levels as these tend to act as passive entry points. Equally as important, know your trigger breakout points as these tend to act as aggressive entry points. A break above the recent high of $0.0015 would act as a trigger breakout.
We will continue to follow EVSV and update our readers on trading activity and corporate developments.