Lone Star Gold, Inc. (OTC:LSTG) has had an insane amount of promotions since mid-August. Now, it seems the hype created by the promoters and the company is slowly going away.
Yesterday, LSTG closed down 2.6% at $0.75 on 943 thousand shares. On Monday, it had lost 5.52%.
The promotional budget seems to be running out, and so does the effect of the pump mails. Several promoters tried to tout LSTG in the past few days to no avail.[BANNER]
Compensations ranged from $4 thousand to $55 thousand – far below the more successful promotions in the beginning.
The lower compensation isn’t the only reason for the failure of these latest tout campaigns. Promoters just went all out at the start with sensational claims that were quickly proven to be inaccurate, incomplete or flat out false.
Additionally, the “rapid growth” of LSTG is yet to be seen, and even if the company manages to do something significant it may not be enough to keep up with the hype.
On Monday, LSTG didn’t rely only on the promotional efforts. The company issued another press release which said LSTG had signed a letter of intent (LOI) committing to the option to acquire an interest in a mine tailing project in Mexico.
The announcement obviously didn’t help, and it’s hardly surprising. A LOI is not much more than a promise written on paper. It doesn’t usually have a legal binding value, and when an OTC company announces one, traders are aware it’s hardly ever anything more than an attempt to temporarily pump the stock price.
The hype is obviously running out of fuel at this point. LSTG is approaching the previous low from where it bounced. It will be interesting to see whether traders will let LSTG get a new low.
