SKPI tanked almost 20% on Friday and closed the last session at $0.745. The trading volume was not that spectacular, but traders seemed quite consolidated after the price fall. However, the stock promoting websites see more potential for SKPI share price to rise even after it had constantly gained over the last months without any fundamental improvements by the company.
The latest SKPI press release provided the occasion for the next trading alert on SKPI stock, sent out during the weekend. Following the recent news, the next update naturally concerned the new project about three new oil and gas wells in Albania. SKPI announced last Thursday a detailed report from its consulting company, revealing the high potential value of the possible reserves of the three exploration blocks.
The evaluation is based on a comparison with some previous reserves estimates. Following that common practice, investors should also build their own opinion about SKPI potential to make profits considering the rather not so enviable results from some previous oil and gas activities. The company has never been profitable and as we previously reported, the only project that generated revenues is not existent anymore.
But SKPI has more failed projects throughout the world, affecting only the current market price of SKPI stock. Last October, the company entered into a non-binding letter of intend to invest in and acquire two oil and gas blocks in Nigeria. The letter of intend expired with no result in April this year. Previously, in 2008 SKPI acquired a minority stake in the development of an oilfield in the Komi Republic of the Russian Federation, a project that it also still pending and the company cannot estimate what the the gains could be, or if there will be any at all.
The only thing about SKPI that provides for some certainty are the $5 million in cash available at the end of June and the lack of long-term debt, implying a book value of about $0.09 for each of the currently over 58 million SKPI outstanding shares of common stock. The latest close at $0.745 looks thus somewhat too optimistic.
