I hope you are one of the lucky people who set up their mind to invest in the shares of Ressources Minieres Pro-Or Inc. (CVE:POI), (PINK:RMIAF). If such is the case, you have all the reasons to rejoice today. Over the last two sessions, POI increased to more than double its value, and it did so on rising volumes. Yesterday, the stock even marked a record turnover in the company’s trading history.
The 1.82M shares that changed hands on the TSX Venture Exchange (CVE) on Tuesday surpassed more than thirteen times the average volume of 137,000. The rise in the price was very significant too – 42.55% in just one session! During the day, the stock climbed to a two-year high of $0.34. All these achievements came on no company developments announced. So, what might have caused the shares’ hype?
A large discussion about Ressources Minires Pro-Or is going on in the stock forums. Many participants there think the enormous surge could be related to the great potential that the company’s Menarik property in Quebec holds. Others suggest that some big news is about to be issued by Pro-Or any minute. However, this has not happened yet and is just a supposition.
There are also people who share the view the glorious march of the shares is related to the fact that the company owns two very promising patented technologies. These are the Platinum Group Metal Recovery (PGM extraction process) used primarily in automotive catalytic converters, and the UpGraded Chromite production used in stainless steel production.
Obviously, at present investors have high confidence in Pro-Or and are convinced it has a huge potential for the future. Still, there is no guarantee the flying of the shares will continue in the coming days. Glancing at the company’s fundamentals, one might notice Pro-Or is financially not so solid as it should be:
- In the end of last September, the corporation had only $245K in cash and a working capital of $145K;
- Pro-Or has no revenue and has recorded a net loss of $0.30M for the third quarter of 2010.
Finally, we could note that the company will, perhaps, have to issue information more regularly to give some explanation for the abrupt boosts in the stock’s trading activity. Otherwise, a few distrustful investors might probably get the feeling that there is something hidden and, maybe, messy going on; something that has been covered from the public. Of course, it is just a supposition.
Lastly, from a technical point of view, POI is overbought; it is unclear for how long it will remain so.
