Caspian Energy, Inc. (TSE:CEK) (PINK:CEKFF) share price bounced the bottom after touching a new 52-week low.
CEK added 16.6% to its value on Monday, following the astounding trading session from Friday when the stock price shot up 20%.
The company didn’t announce any news that could have caused the price run-up. Friday’s action could have been a result of short squeezes, but the intraday chart didn’t resemble the usual pattern – the rally was distributed throughout the day and not concentrated over a short period of time.
The stock price bounced after recently hitting a new 52-week low of 10 cents per share. The price could go lower though as the company is in a poor financial situation:
- Revenues have diminished over the past couple quarters;
- Cash position is running out while covering the losses;
- Currently holds a market cap of $23.26 million;
- Net tangible worth is close to the market cap at $15.8 million;
- Caspian has a working capital deficit of nearly $7 million;
- They have a loan payable of $4.8 million and will have to pay up shortly.
In better news, production has been resumed at East Zhagabulak oilfield and will bring in more sales. The field exploration will require additional capital which is expected to be raised by their new partner Asia Sixth and should total $80 million in debt financing. The failure to proceed with Zhagabulak project may result in punishments from the government of Kazakhstan.
