Mining Promises Lift Up Lustros, Inc. (OTC:LSTS)
Allegiances shift continuously on the penny stock market, and a mining company has shown us potential to attract investors in the next few days. The stock of Lustros, Inc. (OTC:LSTS) marked a three-month record in its buying volume. This copper miner is probably attracting valley buyers after a long decline in price, and at 50 cents buying is resuming again. 
LSTS needs a closer look, since it lacks a visible promotion under its new ticker, or the old one, LSLD. The financial data show the following strengths and weaknesses:
- $248,659 cash
- $2.3 million current liabilities
- $2,959 revenues
- $1.6 million net loss
The company is still in development, with limited revenues on its current activity- copper mining in Chile through its main subsidiary, Bluestone SA. Previously, the company went as Power-Save Energy, until the spring of 2012, when it changed into a mining enterprise. The ownership of a subsidiary may mean the LSTS ticker is a vehicle for another company to gain exposure to the OTC markets.
The claims of owning copper mines are somehow exaggerated, since the Chilean-based business uses the tail end products of expired copper mines. The end product is copper sulphate, in this case with a food-grade quality, possibly to be used for the wine industry.
But even mass production of the substance is a bit far off. Only in January LSTS received a green light to use its first defunct copper mine, and apply the “patent pending” technology to extract the remaining valuable substances. Production is contingent on building a factory worth $6.8 million, quite a great price for a company that uses debt and keeps accumulating losses to finance its operations.
Given the long time horizon for real revenues and operations, it is better to estimate your own acceptable time horizon and taste for risk, knowing that LSTS easily loses 50% of its value in a few weeks, possibly regaining it. But in the past year, the stock has hovered between $1.20 and 50 cents, with surprising moves and days of mass selling in between, behaving as a speculative bet.
Until now, LSTS claims to have sold energy-saving devices, but so far this has not helped the bottom line. While the stock has not been promoted as heavily as other mining small caps (such as still-promoted Graphite, Corp. (OTC:GRPH), the many red flags around the Lustros company should spell caution for investors.
