Longford Energy Inc. (CVE:LFD) (PINK:LFDEF) stayed flat during Tuesday’s session as the trading activity diminished and the price remains in short range consolidation.
This should be only a temporary slowdown as the trading volume was significant over the most sessions of the past week when the price tried to adjust to its new highs.
The stock gapped up in the end of December when the company confirmed that Genel Energy PLC (LON:GENL) is considering a purchase of another part of oilfield in Kurdistan.
Stock price remains near the lower end of its 52-week trading range. This means the bulls would have a lot of space to rally the price up if the deal is confirmed. However it also how investors view the company’s business prospects, and the view isn’t pretty.
Their current market cap is only $20 million, while the net tangible assets of the company sum up to $52.4 million. Such a low valuation is usually assigned to businesses with no ongoing activities, which indeed was the case with Longford until the recent announcement showed a sparkle of life.
The company said on December 21 they were in talks with Genel Energy as the former wishes to acquire 40% stake in the Chia Surkh oilfield in Kurdistan, Iraq. The companies did warn however, that the discussions might not lead to a definitive deal.
