What’s Basenese’s $3 “Buy LEO” Pitch About?

Checking in on Micro-Cap Advantage's tease of a "conservative" potential for 3,906% gains

By Travis Johnson, Stock Gumshoe, March 31, 2021

Here’s the lead-in from a new Lou Basenese ad that got a lot of our readers asking questions:

“URGENT BUY ALERT:

“America’s Leading Technology Analyst Says Buy “LEO” Now!

“This tiny company is poised to transform a $2.7 Trillion market with the single flip of a switch.

“Its groundbreaking technology is already being used by thousands of customers across the globe, like global oil giants Halliburton and Petrobras — with many more on the way.

“And because its stock trades on a ‘secret’ stock exchange — for less than $3 per share — it’s gone completely unnoticed by Wall Street.”

Tiny company… $3 share price… hot “story” area (LEO means Low Earth Orbit, which is the orbit used by the new waves of broadband-providing satellites being launched by Starlink and others)… and a “secret” exchange? What more could we ask for?

Well, we could also throw in the “stick it to the cable company” spiel, something that is almost always rolled out whenever we get a pitch about “space-based internet” — people hate their cable and telecom providers, so the dream that somehow space internet will be cheaper and better always gets attention. This is from the order form:

“By this time next year, the ‘Big Three’ cable companies — Comcast, Verizon, and Charter Cable — could be out of business…

“Not only that, but you could be hundreds of thousands of dollars richer. All thanks to the decision you’re about to make today.”

We’ve seen those spiels ever since the first “Halo-Fi” and other satellite broadband pitches started rolling several years ago — and the promise has also been of a mythically cheaper offering (Ray Blanco always used $7 a month in his teases)… though we should note, of course, that so far prices for the initial products, like Starlink, are pretty comparable to cable broadband (about $100 a month, plus you have to shell out $500 or so for the equipment). Perhaps as Starlink and others grow there will be more price competition, but the main advantage is in reaching more people whose only other option is slow DSL or super-expensive satellite internet from Hughes, not competing with cable and fiber connections in well-connected areas. Comcast and Verizon aren’t going away anytime soon.

The ad is for Basenese’s Micro-Cap Advantage ($995/yr, 30-day refund period), and it uses some of the same themes as he did for his pitch of Gilat (GILT), a satellite equipment provider that he teased for his lower-cost Trend Trader newsletter last year (that one has worked out well so far, for what it’s worth). Here’s a little more from the ad:

“This Tiny L.E.O. Company Could Soon Dominate a MASSIVE Market I’m Calling: “Space-Net” ….

“The market I’m referring to is Space-Based Internet.

“In other words, the ability for consumers like you and me to get high-speed Internet access beamed directly to us… from outer space!”

OK, so we know the big-picture spiel — companies like SpaceX and Amazon and Telesat are building massive constellations of low-earth orbit satellites, and those