• FingerMotion has been the subject of a recent promotional campaign targeting retail investors on social media platforms.
• FingerMotion funds promotional actively through large share issuances to unnamed “consultants”.
• FingerMotion’s stock promotion activities was flagged in the past by OTC Markets.
• The promotional campaign coincided with a 350% run-up in the stock price to bypass the “baby shelf” rule.
• FingerMotion is low on cash and has disclosed that it will need to raise money.
• FingerMotion has an effective Shelf Registration for $300m including a $25m ATM.
• The $300m Shelf Registration and $25m ATM agreement will likely cause significant shareholder dilution.
• Millions of shares are registered by PIPE investors from a low cost-basis and can be sold at any time.
• FingerMotion has given out millions of shares to repay debt investors. Most of these shares have not been sold yet.
• FingerMotion relies on accounting gimmicks to portray large revenue growth.
• FingerMotion’s balance sheet is deteriorating, the company’s gross margin is eroding, and cash burn is increasing.
• Insiders have begun selling shares.

We don’t think it’s a coincidence that the promotional campaign is happening just as the company files to sell shares ATM (effective and able for use). Nor do we think it’s a coincidence that insiders have been selling into the recent run-up in the stock price.