Another Pump For MineralRite Corp (OTCMKTS:RITE)
A couple of hours after trading stopped on May 28, MineralRite Corp (OTCMKTS:RITE) issued a press release with which they wanted to update their shareholders on the developments around their copper mine in Mexico. They said that the shipments are going to start in the last week of June and they also included some extremely optimistic revenue projections for the twelve months to come. The results are evident from the session on May 29 – 223 thousand shares traded and a loss of 5% meaning that when the closing bell rang, the ticker was at $0.04 – the lowest price for the last 7 months.
For some reason RITE decided that they need to remind their shareholders about the operations at their copper mine and they issued another press release yesterday which contains… exactly the same information. It came online just minutes before the opening bell, but this time, the results were a little bit different – a record-breaking 9.7 million shares in trading volume and a 14% gains over the previous close. So, what happened during the days in between that made traders so optimistic?
Well, on June 3 RITE finally published their quarterly report for the first three months of 2013 and while it’s not perfect, there are some things that could get investors excited. Here are the figures:
- cash: $26 thousand
- current assets: $1.1 million
- current liabilities: $893 thousand
- quarterly revenue: $75 thousand
- quarterly net loss: $224 thousand
When you compare this statement to the ones before it, you will see that this is the first quarter that ends with the current assets outweighing the current liabilities. You will also see that they have a lot more cash in their bank account when compared to, for example, December 31.When you put the latest 10-Q with the one for the same period in 2012 side by side, you will see that the 2012 figures under the revenue and net loss sections are better-looking, but you should also bear in mind that the proceeds from their newest subsidiary, Goldfield International, Inc. (which is quoted to be RITE‘s primary source of revenue), are included for only one of the three months covered in the 2013 report. So in reality, things should look even better.
This is not the only thing that happened around RITE between May 28 and June 10. On June 6 they announced that construction has started on their very own laboratory which will help them offer additional services like assay testing. In other words, another potential source of both revenues, and smiles on shareholders’ faces. All in all, RITE showed a surprising amount of progress in terms of their operations during the last couple of weeks. But what about stock performance?
Unfortunately, there are no surprises there. We saw the next in a long line of paid pumps for RITE and it was a big one. Stock Mister as well as a few other promoters pocketed a total of $161 thousand for the awareness campaign that took place on June 4 and June 5. We have covered so many promotions for RITE that we were pretty sure what was going to happen from the very start. Unfortunately, we turned out to be right. The ticker did make a run on June 4 when it gained around 23% in a single session, but by the end of the next one, all the profits were wiped out. The moral of the story? Well, it’s pretty clear – even when things finally start to look up for a company, a paid pump could still ruin the day for a lot of investors.
Speaking of which, there’s a new one right now. This time, instead of employing the bigger players in the stock promotional industry and paying a huge amount of money as compensation, the third parties decided that smaller newsletters like Elite Penny Stock, Leading Stock Alerts, Vip Stock Reports, Awesome Stock Pick and a few others will do the job. Does that mean that we’ll see a more solid long-term performance, however?
Judging by RITE‘s behavior under the promotional pressure, we’re struggling to see how this campaign could possibly end up on a different note. The involved pumpers’ track records are also pretty disappointing. All of the aforementioned newsletters were part of the promotional campaign on Enviro-Serv Inc (OTCMKTS:EVSV) during the first ten days of May. You can see that while all the touting did manage to give the ticker a push in the right direction, it all came crashing down way sooner than everyone was expecting.
That, along with many other examples show that the stock performance is not necessarily connected to the outlook on the company’s future. Especially when the paid pumpers are involved.