Par Petroleum Corp (OTCBB:PARR) With A Modest Gain On Significant Volume
Yesterday’s session was a good one for the stock of Par Petroleum Corp. (OTCBB:PARR). They opened at $1.65 but in less than an hour had dropped down to $1.50. Still they managed to close at $1.61, nearly 4% higher than the previous day. The major difference though were the 1.49 million shares switching owners compared to the 200 traded on Tuesday.
The significant attention towards the stock can be attributed to the recent press release made by the company. PARR announced a definitive agreement for the acquisition of Tesoro Hawaii, LLC from Tesoro Corporation. This new target for acquisition is an integrated refined productions business. The terms of the deal include $75 million to be paid in cash and up to $40 million payable in the next three years depending on certain performance results. In order to secure the required financing PARR are going to sell $200 million worth of common shares. For now the deal is expected to close in the third quarter of this year.
Numbers such as these are not typical for the pennystock market and we decided to check PARR‘s financial report. The latest one is for the period ending March 31 and contained the following:
- $14.6 million cash
- $65 million total current assets
- $61 million total current liabilities
- $64 million revenues
- $4.8 million net loss
The company has two major assets – 33.6% interest in Piceance Energy and ownership of Texadian Energy. Texadian, which they acquired in December, 2012, accounts for 98% of their revenues through its marketing and oil transportation services.
Despite the impressive financial results PARR has some serious troubles. They are the successor entity of Delta Petroleum Corporation following its emergence from bankruptcy. As of March 31, 2013, a total of 53 claims amounting to approximately $53.9 million remain to be resolved.
On Tuesday Norstra Energy, Inc. (OTCBB:NORX) showed some signs of recovery after their multy-million pump. The same, however, cannot be said for Northumberland Resources Inc. (OTCMKTS:NHUR) who fell by a further 6% and have lost around 50% since the height of their promotion.
PARR have some skeletons in their past that they have to deal with but with the recent announcement even more investors might show interest. In early trading the stock is following the same patter of opening with a gap and immediately falling down. As always doing your own research is the best thing to do before attempting any trades involving pennystocks.
