Hot or Not? Three (Promoted) Small Cap Stocks: BANJ, AMZZ & GRDH

Small cap stocks Banjo & Matilda, Inc (OTCMKTS: BANJ), Amazonica Corp (OTCBB: AMZZ) and Guardian 8 Holdings (OTCMKTS: GRDH) have been getting some extra attention in various investment newsletters or email alerts. Of course, there is nothing wrong with properly disclosed promotion or investor relations type of activities but they can cause problems for unwary investors and traders alike. So how hot are these three small cap stocks? Here is a closer look and a reality check:

Banjo & Matilda, Inc (OTCMKTS: BANJ) Was Recently Acquired

Small cap Banjo & Matilda, Inc recently acquired 100% of the issued and outstanding capital stock of Banjo & Matilda - a designer, retailer and wholesaler of contemporary luxury knitwear that draws its inspiration from Australian heritage and beach lifestyle. On Monday, Banjo & Matilda, Inc rose 17.11% to at $0.410 for a market cap of $9.46 million plus BANJ is down 59% over the past year and up 2.5% since February 2013 according to Google Finance.

What's the Catch With Banjo & Matilda, Inc? According to various disclosures, a transaction or transactions of $5k have or will occur to mention Banjo & Matilda, Inc in various investment newsletters. Back in November when the listed entity was still known as Eastern World Solutions, there was a Share Exchange Agreement with Banjo & Matilda Pty Ltd - a corporation organized under the laws of Australia and the shareholders of Banjo & Matilda. In addition, there was an agreement made between the company and Brendan Macpherson who will be the CEO with a base salary of $125,000. Then last Monday, Banjo & Matilda, Inc issued a welcome letter from the CEO which noted:

As we celebrate our public listing and welcome new investors into the Banjo & Matilda family, it's important to note that I believe that this is just the beginning. We have a solid record of constant growth and very manageable debt. Our funding efforts will be targeted on expansion and growth, to position us to benefit from current and future opportunities, not to pay off past due debt loads.

A quick look on Yahoo! Finance reveals the latest posted financials date from the end of last September – before Banjo & Matilda, Inc acquired the listed entity, meaning investors might want to wait for some updated financials to appear that reflect the change in direction.

Amazonica Corp (OTCBB: AMZZ) Recently Got Out of Brazilian Hardwood Flooring and Into Pure Hydrogen

Small cap Amazonica Corp is developing a breakthrough, low cost technology to make 99.999% pure hydrogen. On Monday, Amazonica Corp fell 7.62% to $0.0388 for a market cap of $8.34 million plus AMZZ is down 96% since last June according to Yahoo! Finance.

What's the Catch With Amazonica Corp? According to various disclosures, transactions of $1.5k, $2k, $4k, $25k and $50k have or will occur to mention Amazonica Corp in various investment newsletters. At the end of last August, Amazonica Corp had a complete change in management and discontinued the distribution of Brazilian hardwood flooring to concentrate completely on the development of pure hydrogen for commercial applications. Last Tuesday, Amazonica Corp announced the filing of a combustion mixture patent for its ultra-pure hydrogen production technology – the third patent filed by the company based on ongoing research and development work led by Dr. Gennadiy Petrovich Glazunov, a "world renowned" scientist at the Institute of Plasma Physics of the National Science Center of the National Academy of Science, located within the Kharkov Institute of Physics and Technology in the Ukraine. A day earlier, Amazonica Corp announced that it had recently added an upgrade to a previously submitted patent application for the manufacture of ultra-pure hydrogen while in early April, the company had announced it had completed the filing of a second patent for its ultra-pure hydrogen production technology. A quick look at Amazonica Corp's financials reveals no revenues; net losses of $111k (most recent reported quarter), $48k, $7k and $2k for the past four reported quarters; and $10k in cash to cover $56k in current liabilities and $325k in long term debt at the end of last January. So maybe investors should wait for more financials that show pure hydrogen is a better business than Brazilian hardwood flooring.

Guardian 8 Holdings (OTCMKTS: GRDH) Has Something Better Than a Gun

Small cap Guardian 8 Holdings through its wholly owned operating subsidiary, Guardian 8 Corporation, is the developer and manufacturer of the G8 Pro V2, a unique and innovative product which combines eight non-lethal technologies designed to prevent and protect an individual from aggressors and assailants, while notifying law enforcement or others of the situation. On Monday, Guardian 8 Holdings closed at $0.510 for a market cap of $19.80 million plus GRDH is up 27.5% over the past year and down 15% since October 2011 according to Google Finance.

What's the Catch With Guardian 8 Holdings? According to various disclosures, a transaction of $3k has or will occur to mention Guardian 8 Holdings in various investment newsletters. At the beginning of last week, Zacks Small Cap Research issued a detailed press release summarizing its research report on Guardian 8 Holdings. This came after the company made its Form 10-K/A filing containing end of the year financials. Then in early April, Guardian 8 Holdings announced it had received a positive account of a documented use of its Pro V2 enhanced non-lethal device by security personnel in a hospital setting after a violent patient threatened hospital staff. Otherwise and at the end of March, Guardian 8 Holdings announced it will showcase an enhanced ProV2 non-lethal device and how it addresses the risks and liabilities associated with hospital security response during the International Association of Hospital & Safety (IAHSS) 2014 Annual General Meeting, which is scheduled for May 18-21 at the Hyatt Regency La Jolla in San Diego. A quick look at Guardian 8 Holdings' financials reveals revenues of $18k (most recent reported quarter), $23k, $3k and zero for the past four reported quarters and net losses of $1,465k (most recent reported quarter), $878k, $702k and $580k. At the end of last December, Guardian 8 Holdings had $306k in cash to cover $1,409k in current liabilities. So maybe investors and especially traders should keep an eye on the stock as it heads to the IAHSS meeting.