Nikolay Tomov
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Fire River Gold Corp. (CVE:FAU), (OTCQX:FVGCF) Many News, Little Price Effect

by Nikolay Tomov Apr 7, 2011
Fire_River_Gold_-Logo.jpgObviously, the managers of Fire River Gold Corp. (CVE:FAU), (OTCQX:FVGCF) have decided that early spring is a time for action. The company has announced plenty of releases this week. However, their effect on investors and respectfully on the stock markets seems relatively modest. The shares went up only by a small margin, though on a large turnover.

Yesterday, FAU rose by 2%, climbed to a day-high of $0.54 and finished the trade at $0.50, stopping again at this psychological resistance level. Over the last month, the stock has managed only twice to close a session above $0.50. It was the trading volume that made a much bigger impression. The turnover of 2.36M shares exceeds almost five times the average; yet this is not so extraordinary for Fire River and is far from being a trading record.

It is not clear how the shares will perform in the coming days. The releases issued by Fire River this week were positive. They included: an increase of previously announced non‐brokered private placement to $7.5M; encouraging assay results from the drilling program on the company's main property - Nixon Fork Gold mine in Alaska; the appointment of an experienced general accountant to the Board of Directors; and a message from the President of Fire River assuring the stockholders in the good progress of the company.

Fire_River_Gold_-_Chart.jpgFire River is managed by an experienced technical team aimed at bringing back into production the Nixon Gold mine. As the company states, this is supposed to happen this summer, when a processing plant with a gold recovery system is scheduled to be completed on the property.

In addition to these good developments, we should remind that in early March, Fire River met the requirements to climb from Tier 2 to Tier 1 on the TSX Venture Exchange. Besides, and as stated by the President and as illustrated by the financial reports, the company "is well funded, with approximately $15 million in the treasury". In the end of January, Fire River reported a working capital of $13.7M.

Of course, not everything around the company is perfect. The negative part of the story includes data from the mentioned financial reports. For the three months ended Jan. 31, 2011 Fire River recorded a net loss of $1.28M - a rise of 51% over the year-ago period.

Moreover the stock dilution is large - the weighted average number of outstanding shares was 73.4M for 2010, while in 2009 this figure was 32.7M. It represents a rise of 124%.

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