Financial data improving, stock performance deteriorating. Some people make money on the jumps of Imperial Resources Inc. (OTC:IPRC) on the stock market, a lot see losses on the slumps that follow every sudden increase. It is all about catalysts and the ones who know how to spot them.Among these catalysts are no doubt the paid promotions coming every now and then. Unlike February, however, when lots of paid newsletters hit mailboxes, the first one for this month came out today. Like most development-stage companies, Imperial Resources also shares the same discussions focusing on the current oil crisis and its potential impact on the company. Whether it will happen, remains to be seen, but what is a fact is that heavy promotional activity is, indeed, able to push the price above $1 per share. Once the promotional wave is over, the run is over, which is why Friday`s session closed at $0.52 with 130k shares traded for the day. 
The real catalyst, the one that most development-stage enterprises pray upon, is revenues. Unlike promotions, revenues are the factor which if in place, might lead to sustainable growth in both operational level and stock market performance. The interesting fact about Imperial Resources is that this company, despite being in a development-stage, enjoys a better financial position. The latest 10-Q statement with an end date Dec. 31st, 2010 indicates a decline in liabilities and finally some revenues at hand.
Now, in order to assess the potential return on investment in the case of IPRC, one should first understand the business model of the company. Simply put, Imperial Resources would finance the costs related to the research and exploration of oil and gas properties in exchange for interests in the revenues generated by the latter. For example, the latest press release on the company website from today relates to an independent reserve report on one of its mineral leases in Texas. Preparation operations are expected to commence this week, and as the CEO of the company puts it:
“Nunnelly #1 is a nice opportunistic play for us; the low entry cost makes it a very economically viable project even at oil prices much lower than those prevailing today.” [BANNER]
And this is one more controversial fact about this company. An independent reserve report is mentioned, together with some figures recoverable reserves, yet there is no report for the serious investors to have a look at. Which, in terms, provides a very appealing field for speculations to start on the Internet. And this whole situation is not the first of its kind for Imperial.
Now, if words turn into actions, things might really change. If, as mentioned in the press release, the recoverable reserves are confirmed by additional third party analysis from registered petroleum engineer and actual operations begin, then some stability and sustainable growth might follow on the market. Promotions would no more be needed, once Imperial gains the confidence and trust of current and potential investors.
Unfortunately, this is still a thing of the future, as the present day offers more uncertainty than stability. It is true that IPRC skyrocketed last month to above $1, but it was not really solely due to the company’s performance. The situation repeats again with positive press release and promoter in place today, the question is – will it follow the established pattern, or finally start showing some signs of sustainability and predictability?
