Gediminas Jasionis
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Mega Uranium Ltd. (TSE:MGA) (PINK:MGAFF) Stock Continues To Drop Under Heavy Trading

by Gediminas Jasionis Dec 20, 2011
1mga_chart.pngMega Uranium Ltd. (TSE:MGA) (PINK:MGAFF) share price continues on the downtrend as usual but the stock attracted attention when it recorded a tremendous trading volume on Monday. 4.5 million shares changed hands during the session. The stock price didn't show that much action though. 

The daily candle left a long downwards shadow after breaking below 20 cents per share but remained inside the very narrow downtrend.

The action could have come as a delayed reaction to the financial results for the fiscal year ended September 30 which the company released on December 15. The books marked some serious negative developments compared to 2010:

  • Revenues were negative $1.6 million due to losses on investments in public companies;
  • Operating expenses grew threefold to $147.6 million as a result of large write-down of mineral properties;
  • Net loss for the year was 4 times larger than in 2010.

mega_uranium_logo.jpgStill most of the sums were non-cash which lead to only $1.85 million negative cash flow. The write-downs occurred when Mega Uranium terminated options on a number of mining properties. Cash cost of write-offs was $6.38 million and the rest came as an impairment of value.

The company retains ownership to various degrees a number of other properties throughout the world, but doesn't generate any revenue from mining. An interesting fact is that Mega Uranium decided to drop their rights to the Lake Maintland properties which were name as their flagship project.

Comments (2)

1. Guest
November 16, 2012, 01:18PM

Quotes Based on Mega Uranium's Q3/2012 figures, the company had $165.9 M in assets and $1.9M in liabilities. This represents a NAV of $0.62 / share based based upon 267.1M shares.

Total Assets = $165.9 M
Liabilities: -$1.9M
NAV = $164 M = $0.62 / share

Mega Uranium recently announced that the government of Queensland had lifted the ban on Uranium mining. The market reacted with a +60% increase in the stock's price. This tremendous increase was shortlived due to some profit - taking by short term day-traders on minuscule volumes. But for those that have a little more patience, we have huge expectations for this stock once it pops back on the investment community's radar screen. With so little volume traded every day, even the slightest piece of good news causes this stock to pop. and with a NAV roughly 5 times the current market value and literally no debt, the upside potential is huge with very little risk.

2. Guest
December 23, 2011, 10:42PM

Quotes What a bunch of horseshit. Where does it say on the website or securities filings that Mega Uranium is giving up on Lake Maitland!!!

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