Yesterday, SFMI closed 2.35% lower at $0.166 for a share on a near the average trading volume. The latest event with considerable effects on SFMI stock dates back to the end of September. Then, the initiation of some analyst coverage was announced and it involved the preparation of a research report that gave a six to twelve months price target of $1.25 and a long-term target of $2.50 for SFMI shares.
It is not unusual that the CFA who prepared the report was paid with $8,500 for his work, disturbing however is the fact that he was paid by the company itself, which makes it somewhat doubtful if he was able to remain unbiased in his unbounded optimism about SFMI future prospects.
At the time the coverage was announced, SFMI was just making one of its rapid jumps, a day later the last known trading alert was sent. In it, the alerting promoter mentioned the stock as one of this latest winning mining plays. But since that day, SFMI was not a winner anymore, falling down to its pre-promotional levels and losing almost half of its value within a day.
According to the last filed financial report of the company, it has begun “processing tailings left from previous mining activity” at its only mining site, located in War Eagle Mountain. For now, the plan is to collect mineral dore bars, from which first sales are expected to come as soon as enough of these dore bars are collected and get shipped to a refiner for final extraction of minerals. Exact dates are not given, nor possible value estimates, which makes it hard for traders to get an idea if or when SFMI will get profitable.
At the same time, still no investor for the needed $6.5 milion to start the actual mining of raw ores could be found, which along with the high dilution risks prevents long-term and stable gians for SFMI stock. At the end of June, the company had around half a million dollars in current assets, as compared to almost two million dollars in current liabilities. In addition come the $2.4 million in notes payable.
