Norstra Energy, Inc. (OTCBB:NORX) Contains Crash – Too Little, Too Late
After thundering downhill in a disastrous streak of red days on the market, on Friday Norstra Energy, Inc. (OTCBB:NORX) was able to claw to a halt. The stock managed to close 5% up in the last market session, but this is hardly consoling to the investors who rode the pump, as the closing price was still below the levels throughout the pump.
We actually alerted our readers to the possible dangers associated with NORX as early as May 22, when the stock was being pumped through landing pages. Despite the huge budget for the NORX pump extending in the millions of dollars, handed out to both email pumpers and makers of landing pages, the price movement came to its inevitable conclusion, dropping about 70% from the peak of the pump.
We’ve examined many troubling aspects of NORX, both in the video coverage of the company, as well as in numerous articles. The story behind NORX was a slight variation of the usual one-two combo of doing a forward split and selling cheap shares to undisclosed parties before getting a massive pump, only the split took place before selling the shares. Once the pump had inflated the price to an acceptable level, the sell-off happened and the result is very plainly visible on the chart.
The company’s claim to fame was supposed to be a property in the Bakken area that they will acquire after NORX spends a little over $15 million on exploring and developing the property, including the drilling of three horizontal wells that will cost $5 million each. It’s not too clear how the company intends to do this, considering it has only covered the ‘little over’ part, with the $15 million still pending. NORX also had just under $100 thousand in cash back in February this year, which is also the date of its most recent financial status update.
Brazil Minerals, Inc. (OTCBB:BMIX) was another company that plans to probe the earth looking for riches and which dropped sharply in Friday trading, losing over 12% of its share price. The stock came down from dizzying heights from around $0.90 per share, now also trading about 70% down. On the other end of the spectrum, Liberator Medical Holdings, Inc. (OTCBB:LBMH) gained 21% on Friday, carried by a cash dividend announcement as well as share buyback plans.
In closing, despite the fact that NORX has so far crashed nearly 70% from its pump-induced high, the stock was trading much lower than its current level just three months ago, so investors are advised to weigh very carefully the risks involved in putting money in the company.
