This is a very contradictory week for the shares of Western Energy Services Corp. (CVE:WRG), (PINK:WEEEF). They go up and down on large volumes.
This Tuesday, they slipped by 10.3% on the TSX Venture Exchange (CVE), noting also a 4-month low of $0.25 during the session. The very next day, they jumped 11.4% up, going back to the $0.39 price level again. Yesterday, the rise continued – slower, but on rising volumes.
The turnover of 4.87M shares is well above the company’s average. At the same time, WRG advanced 2.56% up, finishing exactly at $0.40. Principally, the price progress on increasing trading volumes is a bullish sign. Still, we cannot be 100% certain the shares’ rise will continue in the coming days.
The current surge is perhaps driven by the latest financial reports released by Western on Wednesday. They look positive to some extent:
- In the end of 2010, the company had $3.48M in cash and a working capital of $15.1M. These figures, however, do not include the $86M financing completed in the end of March;
- Western reported a net income of $27M for 2010, compared to a loss of $2M for 2009;
There are, however, some negative trends, indicated by the same reports. The stock dilution is very large. The average number of common shares for 2010 was 454M, while currently Western has over 946M shares outstanding.
Perhaps, this is something the company will have to change in the future in order to guarantee better dividends to its stockholders than at present.
Technically speaking, a Doji was formed during the last trading session. This suggests a fierce tug-of-war between sellers and buyers and a great indecision in the traders.
