{"id":853,"date":"2013-01-11T11:10:00","date_gmt":"2013-01-11T11:10:00","guid":{"rendered":"\/?p=853"},"modified":"2013-03-25T20:14:43","modified_gmt":"2013-03-25T20:14:43","slug":"bombastic-news-for-lone-star-gold-inc-otclstg-take-its-toll","status":"publish","type":"post","link":"\/articles\/bombastic-news-for-lone-star-gold-inc-otclstg-take-its-toll\/","title":{"rendered":"Bombastic News for Lone Star Gold, Inc. (OTC:LSTG) Take Its Toll"},"content":{"rendered":"

\"90LSTG_chart.png\"The last few days have been fairly intense for Lone Star Gold, Inc. (OTC:LSTG<\/a>) as its stock scored some really big gains followed by substantial nosedives. At the root of it all lies a bombastic press release about an investment agreement. <\/p>\n

It all started on Dec. 20 when Lone Star filed an S-1 form, i.e a preliminary prospectus for the resale of up to 19.6 million shares of common stock to Deer Valey Management, LLC, which would allow them to receive external capital of up to $15 million over the next three years. As it it, the agreement came into effect on Jan. 7 when the company announced it officially. Naturally, investors got their hopes way up as they walked into a trading frenzy with LSGT.<\/p>\n

As a result, LSGT surged 66% on the corresponding session. What is more, the euphoria lasted for two more days, leading to an aggregate appreciation of 337% by the end of the Jun. 9 session. Needless to say, this run was accompanied by record-breaking volume levels. Unfortunately, this is where the good news ends.<\/p>\n

Just as everybody wondered when (and if) Doomsday will come, it did appeared yesterday when lots of profit takers sold their stakes, thus saturating the market. As a consequence, LSTG<\/a> closed trade at $0.0879, down 45% from its previous close. Moreover, one hour into today’s session, the stock is still losing ground as its current quote at $0.075 amounts to a 15% depreciation as compared to its Jan. 10 close.<\/p>\n

\"28LSTG_logo.jpg\"According to the agreement, LSTG<\/a> will be utilizing the money to start constructing its first processing plant in Mexico which will supposedly process a total of 1,000 tons of mine tailings per day within the next 3 to 4 months. No doubt, we will keep a watchful eye on LSTG<\/a> to make sure that CEO Danie Ferris remains true to his words. In the light of the company’s overall state, however, the odds might turn against him. Why?<\/p>\n

A quick glance at LSTG<\/a>‘s financials reveals that, even at $7.9 millions, its market cap seems way overvalued. What you have got against this figure are $289 thousand of assets, a cumulative loss of 1.7 million, as well as zero revenue. By contrast, in 2011 Ferris splashed out more than $1 million to satisfy administrative expenses, including his salary.<\/p>\n

Provided that everything goes according to plan and LSTG<\/a> gets a grip on those $15 million and manages to utilize them in the best possible way, the company might make a step into the right direction. For the time being, however, keeping a critical eye on the stock seems like a logical move.<\/p>\n

\"\" <\/p>\n","protected":false},"excerpt":{"rendered":"

The last few days have been fairly intense for Lone Star Gold, Inc. (OTC:LSTG) as its stock scored some really big gains followed by substantial nosedives. At the root of it all lies a...<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[1],"tags":[437],"class_list":["post-853","post","type-post","status-publish","format-standard","hentry","category-news","tag-lstg"],"_links":{"self":[{"href":"https:\/\/articles.thehotpennystocks.com\/articles\/wp-json\/wp\/v2\/posts\/853","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/articles.thehotpennystocks.com\/articles\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/articles.thehotpennystocks.com\/articles\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/articles.thehotpennystocks.com\/articles\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/articles.thehotpennystocks.com\/articles\/wp-json\/wp\/v2\/comments?post=853"}],"version-history":[{"count":0,"href":"https:\/\/articles.thehotpennystocks.com\/articles\/wp-json\/wp\/v2\/posts\/853\/revisions"}],"wp:attachment":[{"href":"https:\/\/articles.thehotpennystocks.com\/articles\/wp-json\/wp\/v2\/media?parent=853"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/articles.thehotpennystocks.com\/articles\/wp-json\/wp\/v2\/categories?post=853"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/articles.thehotpennystocks.com\/articles\/wp-json\/wp\/v2\/tags?post=853"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}