Yesterday was the third in row trading session of China Armco Metals, Inc (AMEX:CNAM) stock with an upward direction, maybe to confirm the coming of the green line trend.
The news related to the operations of the long expected exploitation of the company’s new scrap metal recycling facility, accompanied by a CNAM stock promotion, forged finally a stable shares rush.
Since the above mentioned company’s release about the first metal shipments, CNAM shares rose 12.78%. The stock rush was however made possible not only thanks to that news.
The strong support of stock promoters yesterday resulted in another 6.84% CNAM price increase on almost double the average volume traded.
According to the latest disclosure about the CNAM stock promotion, the company compensates the promoter with three hundred and seventy thousand dollars. Seventy thousand dollars was the compensation for the services currently provided and three hundred thousand dollars were for the previous stock promotion.
During the last session, the highly volatile CNAM stock traded within a 52-week range of $0.85 – $11.10 and closed the market at $4.06, overcoming the psychological limit of bids below $4. At the same time, the share price was far away from its capacity to jump over the sacral $10.[BANNER]
Announced at the end of this May, CNAM financial results for the first quarter of this year were not able to revitalize CNAM stock. Despite the overall positive meaning of the information presented there, investors were not convinced to let the price increase.
One of the possible reasons for this was maybe the value of the gross profit, which was not able cover all the company’s expenses. The other one was the decreased, but still high enough, value of the accounts receivable. The third, and most important reason, were probably the works in progress of CNAM new recycling facility. As of the end of March, CNAM has never operated that recycling facility.
