Drinks Americas Holdings is Off and Running (DKAM)

Say whatever you want about Drinks Americas Holdings, Ltd. (OTCMKTS:DKAM), but one thing is undeniable... this company is producing a lot of revenue despite being a very small company. More specifically, the DKAM market cap is abnormally low relative to the sales figures the company is putting up.

No, there aren't any profits - at least not yet. That's nothing unusual for a small cap company at this stage of its life. The thing investors key in on at this level is proof of life, and Drinks Americas Holdings has plenty of that. And, perhaps more important to would-be shareholders right now is the fact that DKAM shares are starting to move higher, in a trade-worthy way.

For those not familiar with it, DKAM is, as the name would suggest, a beverage company. Specifically, Drinks Americas Holdings, Ltd. is a producer as well as a distributor of a few niche/specialty wine and spirits brands. It's nowhere close to being what some would consider a "major player", but all things are relative. Though the company is only a $680,000 organization (on a market cap basis), Drinks Americas also generated $6.3 million worth of sales for the past twelve months. Granted, it also lost $11.7 million in the process, but the net income or net less at this point is largely secondary. The hard part is growing sales, but that hasn't been particularly difficult for DKAM. In fact, sales have been strong enough for long enough to prompt what's made this stock such a compelling idea now.

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In simplest terms, DKAM shares are starting to move, clearing technical hurdles in the process, and establishing even more well-supported momentum. The chart below tells the tale. Drinks Americas Holdings, Ltd. shares have walked their way above all their key moving average lines over the past three months, and they've done so on rising volume. In fact, the volume we've seen since November is the most we've seen from the stock since, well, ever. With that much participation in a very sustainable, well-paced rally, odds are very good this uptrend is going to keep chugging along. And well it should. There's more going for this company now than there's ever been before.

As is the case with any micro cap, Drinks Americas Holdings isn't a completely risk-free trade. Much of the recent bullishness has stemmed from the company's aggressive press release campaign. Should those efforts stop, so too might the buying effort. But, at least the company has something to tout, and given that the PR effort is working - and helping DKAM move upward - odds are pretty good that the company will stick with the effort, spurring more upside for the stock.

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