The stock of Romarco Minerals Inc. (CVE:R), (PINK:RTRAF) is finally going in the right direction. On the TSX Venture Exchange (CVE), the shares began climbing three sessions ago. Since then, R has added 15% to its value. Yesterday, the rise was confirmed by a very large turnover. No new company developments have been announced over the last week.

Romarco_-_Logo.jpgPerhaps the reasons for the upward move of the stock are speculative. In the last session R went 6.2% up on a volume of 8.746M shares. This is four times the average turnover and a record for May. The stock finished at $2.06, which is a two-month high.

Romarco_-_Chart_-_1_June_2011.jpgThe latest official data issued by Romarco were the financial reports. They were filed on SEDAR last Tuesday. They give enough confidence to investors to expect a possible climb in the share price in the future. In the end of this March Romarco had $88.3M in cash and equivalents and a working capital of $81.5M.

On the other hand, some figures in the financial statements are not so positive. The company is not in the production phase as yet and is not earning any revenue. For the first quarter of 2011, Romarco recorded a net loss of $4.75M. This might be normal for a company in the development stage, but still sounds a bit too much and a little disturbing.

In the end, we should point out that at present Romarco is overvalued. Its market cap is way, way above the net worth of the business. This implies that a further progress in the stock price is hard to expect. Which does not mean that R will not erupt in the days to follow. On the Canadian market, there is nothing impossible.