shocking volume of over 4 million shares traded.Raser started rushing down just after the latest news about their business was released. Yesterday, the company reported that in view of their current cash resources, non discretionary expenses, debt and near term debt service obligations, the team was intending to explore all strategic alternatives to maintain their business as a going concern. This might also include a sale or merger of the company, as well as one or more other transactions, including a comprehensive financial reorganization of RZTI.
Obviously, the news struck investors and they started dumping off shares intensively. Now, unless Raser finds a way to get out of the crisis, it is quite possible the down trend to continue.
Raser Technologies is an energy company focused primarily on geothermal power development. Historical data shows that the latest gains of RZTI were due to positive news on the company’s activities. However, every time the stock was up, the up move was broken shortly. The question is what will happen with RZTI this time?[BANNER]
In any case, while the company’s 10-Q report looks disastrous, the next move of the stock is hard to be predicted. The company’s liabilities are almost 50% higher than its totals assets and it has a long-term debt to pay. Apart from this fact, by September 30, 2010 the accumulated deficit of RZTI exceeded $194 million and the stockholders’ deficit was around $50 million.
As Raser are not generating significant revenues, their cash and cash equivalents will continue to be depleted by the ongoing development efforts, as well as by their general and administrative expenses. Thus, the company will need either to find additional financing fast, or to explore other alternatives for maintaining their business.
