That will come crashing to earth soon!

MedCareers Group, Inc. (MCGI) has been a great story to watch over the past few days.  Lots of PR and a frothy stock price and some very impressive gains.  The question for me is it real and will it last?

It appears that it only became active recently after changing its name from RX Scripted, Inc. in early 2010.

They must have been saving up press releases because they have flooded the airwaves with several in rapid succession.  With the purchase of medcareers.com, they became Med Careers, Inc.  That book of business has been enhanced with the announcement of the purchase of two additional companies: Staff MD and workabroad.com.

It appears that they are in the online medical staffing business based upon the PR’s I’ve read.  The website gives some amorphous description of the business they are in. …that doesn’t really match their recent PR’s.

As you can tell, I am highly skeptical of their business. It seems like it is a phenomenon of some good PR and the expectation that this company is going to be a “player”.  The challenging thing is to put some kind of revenue and profits numbers to all this PR.  MCGI isn’t telling us, so I am assuming that the company is more sizzle than steak.

For as fuzzy as I think their website is, you can’t argue with this chart:

Note:  The issue is so new that my old charting standby, Stockcharts.com, hasn’t even listed MCGI in its database

Will this stock be a penny stock before it is a $5 stock?  I think so.

The Stochastics are very overbought, but until we get more trading history it is almost impossible to point to that indicator to say that it is going to fall.  What can they follow this hype up with?  Eventually traders will become numb to news about MCGI. Financial transparency, real revenues and profits will keep this stock afloat.  When the good news runs out, so will MCGI.

Good luck and good trading,

Jeffrey Dean

Editor

Oh, by the way:  The answer to the question I posed above (The question for me is it real and will it last?) is NO and NO!