DLKM stock jumped 21.87% up within the session and closed at $0.39 for a share on a trading volume of five times the average. The share price could not break the upper trading band at $0.395, but a bullish MACD line cross and money flow indicator pointing up suggest that the stock could attract more buyers and rise further up.
The fundamentals of Douglas Lake do not make its shares so attractive, however. Lastly the company confirmed over a press release certain gold mineralization on its newly acquired Handeni Project in Tanzania. But the fact that the detailed update on DLKM exploration activity received modest reaction on the market makes the jump of the share price yesterday look somewhat speculative.
Douglas Lake’s latest financial report shows that the company has not yet determined any mineral reserves on any of its properties. The working capital deficit of $1.4 million and the accumulated losses of $31 million since inception are also facts that raise more doubts on DLKM further existence, rather than suggest that it could bring to an end its exploration program.
The Handeni Project was acquired in September this year and comprises four prospecting licences covering around 800 square km located in the Handeni District of Tanzania. Under the acquisition agreement, the company issued 133,333,333 restricted shares of common stock to IPP Gold Limited, the former owner of the project. As a result of the transaction, IPP Gold owned 61.9% of the company at the time of the acquisition, and the total number of DLKM outstanding shares more than doubled.
