Several sessions ago, the shares of Currie Rose Resources Inc. (CVE:CUI), (PINK:CUIRF) began to rise again on the TSX Venture Exchange (CVE). Having dropped by 55% over the last month, now CUI is making attempts to recover. Yesterday, not only was the price progress significant, over 21%, but it was also confirmed by the high trading volume that surpassed two times the company’s average.
Within a week, GUI managed to push 33% up, regaining some of its recent losses. Still, the stock is well below its New Year’s level, when it was traded at $0.33 per share. As the current surge comes on no announcements, we must look for other possible clues that might have caused it. It is not hard to arrive at the idea that it is probably a speculative climb, driven by the desire of some investors to make quick short-term profits.
We might also assume that the current progress is related to a previous company announcement. A week ago, Currie Rose entered into a joint venture agreement with the Australian company Liontown Resources Limited. In accordance with the deal, Liontown is obliged to develop the company’s Jubilee Reef Gold Project in Tanzania and has the right to earn a 75% interest in the property by conducting a definitive feasibility study.
On the day when this strategic agreement was announced, there was no reaction by the market and the shares even slipped down a bit. Maybe investors have appreciated the news with a little delay, which could be yet another explanation for the present climb of the stock.
Is a further surge of the shares possible? It looks so. The latest financial reports for the third quarter of 2010 reveal some positive trends that speak in favour of the stock:
- There is a net income of $471K for the period, compared to a net loss of $96.6K for the Q3 of 2009
- At the end of September 2010, the company had $971K in cash, while one year before that this figure was only $68K.
Of course, these favourable results are no guarantee that the shares will continue to rise in the coming days.
