Colorado Goldfields Inc. (PINK:CGFIA) finished yesterday’s session without a change in its stock price. The trading volume was 37 million shares, which is half the daily average.
There is a probability, though, that the coming session will be more active than the previous one. The increased activity can be produced by a released newsletter on the company.
The promotion was detected yesterday in the evening. Two promotional sites stood behind the campaign. The first promoter is called Speculating stocks and the second one – Gusher Stocks.
Unfortunately, only one of the newsletter arrived in a readable format at the Hotstocked system. Still, the information included there was enough to realize that $1000 were spent on the campaign so far and the promoter expected another $1500.
The campaign was ordered by an entity called Investor News Source and it is expected to last two weeks. With this campaign behind its back, CGFIA can produce more volume in the coming session but it is not certain how this will affect the stock value.
In the last month, the company has reported $1.5 million net loss and nearly $700 thousand increase in current liabilities. At the same time, CGFIA has procured nearly $1 million by issuance of convertible debt and another $1.3 million by issuance of stock.
As a result of the stock issuance spree the of the company has registered a colossal increase in its number of outstanding shares. The official 10-Q report indicates that in Aug. 2010 CGFIA officially had 1.773 billion class A shares and 40 million class B shares. As of May 2011, CGFIA had 4.752 billion class A shares and 490 class B shares. Thus the aggregate increase in outstanding shares for this nine-month period amounts to 3.4 billion which has been a devastating distributional blow to the company’s shareholders.
On this account, it is not clear what the aim of the promotional campaign is. Is it to bring more awareness to the company’s operations or there are third parties holding a bunch of the issued shares who want to dump them on the market when there is a suitable opportunity?
