XTRA ENERGY CORP (PINK:XTPT) Don’t Know What They’re Looking For
There are hundreds, if not thousands, of small cap companies who claim that they have millions of barrels of oil or hundreds of tonnes of gold or huge amounts of rare earth minerals under their feet, waiting to be turned into mountains of cash. Most companies are satisfied with only one type of exploration. XTRA ENERGY CORP (PINK:XTPT) are a bit different.
It’s all a bit confusing. They went through a couple of businesses before they entered the oil exploration sector. Back in January 2012, however, they issued quite a lot of shares and they acquired a company called Anglo-African Gold. In May they published a press-release claiming that they are officially a gold exploration company. Then, five months later, they said that they have acquired a prolific oil well in Canada. They just can’t seem to make up their mind.
That doesn’t stop promoters from sending emails full of promises of wealth and fortune. But let’s escape from the idealistic picture that the pumpers draw and take on a more realistic view.
As you probably know any sort of mining or exploration effort needs a solid financial backing. We immediately headed off to the OTC Markets to check if XTPT have it and we found the latest financial report that covers the third quarter of 2012. It contains the following figures:
- current assets: $1,100 in cash
- current liabilities: $124 thousand
- revenue: $178 thousand
- net loss: $6 thousand
The disturbing thing is that the statement covering the same period of 2011 looks much more promising. For example, the revenues are nearly five times higher and they did register a net income of $96 thousand.
As we mentioned above there’s no clear definition of what the company is actually doing. In much the same way there’s no clear definition of where the revenues are coming from. Is it the gold dug out from Africa? Or maybe the oil coming from Canada? On the whole there are a lot of questions that remain unanswered by the report.
Whisper from Wall Street are only too happy to tell us that the 52-week high for XTPT is $0.35 per share. Indeed it is. It was achieved back in October 2012 when there was a another promotional effort for XTPT. What happened afterwards, however, can be described as a catastrophic downfall. Right now the ticker is traded at around $0.03 per share which means that history could repeat itself, once again leaving a lot of badly burned investors behind.
When you consider the fact that XTPT are promoted by Whisper from Wall Street, the risks are even higher. We’re pretty sure that people who believed the emails regarding TEXAS WYOMING DRILLI (PINK:TWDL) aren’t willing to trust them once again. The pump for TWDL took place back in January and you can see from the chart on the right how badly it all ended up.
Having all that in mind, we would say that XTPT need to give more information about the nature of their operations and they should definitely do everything they can to stay away from paid pumps. They saw what happened back in October, and there is little to stop them from crashing down once again.
