Starfield Resources Inc. (TSE:SRU) (PINK:SRFDF) started to correct back down after a short price rally to celebrate the third quarter improved results of operations.Since there was a fundamental background to the rally, the price could remain higher for an extended period with only temporary retraction. Further appreciation is another matter though. The preceding downtrend gives off a presumption of weakness, yet even with increased stock price the market cap of $77 million is still below the net tangible worth of the company which calculates to roughly $118 million.
In the third quarter report, the company disclosed some noticeable financial changes compared to the same period in 2009:[BANNER]
• Cash on hand decreased 67% to just over $1 million
• Expenses went down 72%
• Net loss decreased by 69%
• Stock dilution over a year reached 37%.
Starfield Resources Inc. has already addressed the lack of cash by securing a $5.1 million private placement at the beginning of December. The business is still in exploration stage and requires outside capital for the development of properties, but the means of funding clearly hurt shareholders. Most of the currently outstanding options have an exercise price well above the current share price of SRU. Many warrants on the other hand can be converted at prices of 5 to 10 cents per share.
