Alterra Power Corp. (TSE:AXY) Breaks Out on Low Trading Volume

[[tagnumber 0]]Alterra Power Corp. (TSE:AXY) spiked out of the trading channel yesterday, more than two weeks after the company announced in a press release the start of a new renewable energy project and filed its first quarter earnings report. The report implies an increase in debt that could hold investors away from the stock.[[tagnumber 1]] [[tagnumber 0]] [[tagnumber 1]] [[tagnumber 4]][[tagnumber 5]][[tagnumber 1]] [[tagnumber 0]]AXY closed at $0.41 yesterday with a 7.89% gain from the previous day close. The trading volume was below the average, and yet the spike of the share price looks huge on the chart as AXY as the stock had been trading in a channel for more than seven weeks. Yesterday‘s high did not break that from early April, and technical indicators are not giving any buy signals for AXY today.[[tagnumber 1]] [[tagnumber 0]] [[tagnumber 1]] [[tagnumber 0]]In the middle of May, AXY first quarter financial report showed revenues decreased from the same quarter of last year while the disproportionally higher net loss resulted from foreign exchange losses. The company holds varying interests in renewable energy projects on different locations and the management claims that the overall performance of its fleet against budget reached 103%, which represented a first quarter record. In addition, two other project should be fully operating by 2016.[[tagnumber 1]] [[tagnumber 0]] [[tagnumber 1]] [[tagnumber 0]]Along with the earnings release, AXY also announced another project. A memorandum of understanding has been signed between the company and Klahoose Firts Nation to work together on the development of the 15MW Tahumming River hydroelectric project located near another two projects of AXY.[[tagnumber 1]] [[tagnumber 0]] [[tagnumber 1]] [[tagnumber 4]][[tagnumber 20]][[tagnumber 1]] [[tagnumber 4]] [[tagnumber 1]] [[tagnumber 0]]A problem could be the available cash reserves and the working capital which shrank to only $16 million. AXY plans a new loan, and also there is an existing revolving credit line provided by the Chairman. Additional borro[[tagnumber 25]]wing will add to the already huge debt of the company and change considerably the capital structure, which in turn would bring the share price down.[[tagnumber 1]] [[tagnumber 4]] [[tagnumber 1]]