Nikolay Tomov
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Simba Energy Inc. (CVE:SMB), (PINK:SMBZF) Stock Is Up in Price and Volume

by Nikolay Tomov Feb 1, 2011
For several sessions, the stock of Simba Energy Inc. (CVE:SMB), (PINK:SMBZF) has been slowly but firmly climbing up on the Canadian Venture Exchange (CVE). The shares advance in both price and volume, and yesterday the progress was even more noticeable than before. On no new announcements, SMB moved 11.4% up, noting a new high of $0.225 during the day. This was also a 2-year price record.

Simba_Energy_-_Chart.pngFurther encouraging is that the rise came on a large turnover of more than 3.7M shares changing hands. In fact, the stock has been heavily traded over the last month, as the graphics show. Since then, SMB is constantly going north on the charts, adding value and gaining new territories. The figures speak for themselves - since Christmas the shares have gone up by almost 144%, quite a remarkable achievement.

To many people it is even more amazing, maybe, that the present surge comes on no major company developments. The latest information issued by Simba was from a week ago and informed about the closing of a $3.385M private placement. The raised capital will be used for the payment of government fees and preliminary ground work expenses in Mali, as well as for the pursuit of Production Sharing Agreements in Ghana and Mali.

These funds are more than welcomed by Simba Energy, as the latest filed financial statements reveal. Here is what the reports for the third quarter of 2010 show:
  • At the end of last September the company had only $132.4 in cash on hand
  • As at Sep. 30, 2010, the company had a working capital deficiency of $569.5M
  • Simba incurred a net loss of $277K during the Q3 of 2010.
Simba_Energy_-_Logo_2.pngThe financials do not provide a solid ground to expect a significant rise in the shares' price in the near future. However, the stock markets are to a great extent unpredictable and can always surprise you in one way or another. Besides, the speculative motive is no doubt a significant factor too. Probably the current surge of Simba's shares is also driven by such a speculative interest in the company.

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