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For those of you who are active on the general Economy Forum you might recognize this thread. The topic goes ”Invest wisely for great profits: ERX: ZRV”, and this is for sure, one of the more miss leading topics I have seen in a long while. Keep reading and we will let you know why!

iZarvy is a corporation currently owning four companies in three different industries, Weapon, Food and Housing. Two of the companies are Q3 and two are Q1. Before we analyse the state of these, lets start of with their financial statement.

First of all, iZarvy have a very thin financial report that looks like it’s been chucked together in a few minutes, it contains just about a list of companies owned and a summary of products in stock. Not a word about what cash they have at hand or how much raw materials in stock. Neither do they present profit nor dividend estimates, however they let us know they paid 100 Gold last week as dividend, which, if paid out weekly as the say in their financial statement would yield a monthly dividend yield of amazing 50%! But before you jump the “Buy” button, please read the remaining of the article. All in all, the financial statement completely lack most valuable information, it contains pretty much nothing not available through ERX. For those of you who are interested in reading you find it here.

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With such a lack in information, how are we going to rate this company you probably ask yourself? Obviously, we had to contact the owner in order to get some answers to our questions. We are told that the corporation as a whole will make about 90 gold a week. Of this profit, 80-90% will be paid out as dividends. Looking at their ERX page one can se that they actually paid out some dividends over the time. However, 90 Gold a week would mean 3.2 Gold per company and day, which considering two of these companies are Q1, this obviously makes us a bit suspicious.

Looking at the companies ran by ZRV the only one fully employed and currently running are the Q3 House Company, and that one have 15 houses in stock. Not saying it has to be so, but one could expect they have a hard time selling these things. The other companies are all of them empty shells. The Q1 weapon and food companies are both totally unemployed. In the Q3 food company they have one (1) employee. To us, it’s quite clear that these companies aren’t making any 90 Gold a week and I suspect that the dividends paid out earlier heirs from sold shares.

How much do you have to pay for this company then? Well, the Org Value is listed at 400 Gold on ERX, and even that is high. Companies and Org’s are together worth 245 Gold so most of that wealth comes from unsold stock. The market cap however is incredible 800G, which means you get three empty companies, one running and a load of unsold stock for the price of the double. This company should really offer a discount, I could buy an inactive Q3 company for maybe 70-80G, buying ZRV, and istead you pay the double! On the basis of the previous statements we cannot award this company a "Certificate of Investment Grade" and rate the share EE.

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Since they have a quite decent amount of stock they are not bankrupt, but considering that three out of four companies are totally inactive we se many other more favourable investments out there. The low rating also comes from the fact that the financial statement is very thin and obviously contains errors or at least strong exaggerations.

One of the few things that this company got going for it is the PR. The GM have managed to get some publicity on the forum and obviously sold the company for a lot more than it’s worth. We recomend sell, and we think that a reasonable price for the company at it current state is 0,02G per share.

This rating will remain until (1) they have activated all their companies and (2) the financial report is updated. We do not whish to completely rule out this company, but one should certainly wait untill we have updated our rating or make sure all companies are active. At it's current state, we seriously doubt they will be able to live up to theire commitments.

Kind Regards
Yossi Ghinsberg
Chairman
GBi Rating Co., Ltd

Do you want your company rated? Send me a PM, prices are notiable for small companies with limited funds. Remember it's not all size to get a good grade! Read about how we decide grades HERE!


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