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Penny Share Review 528

Monday 25 January 2010

The Guardian on Saturday noted a small increase in the shares of Coolabi (COO), citing traders’ claims that an overhang of more than 1m shares had been cleared, having been placed with “a number of institutions.” Two non-executive Directors of the firm also helped find a home for the shares, believed to have been held by Schroders. Activity spilled-over to this morning when in early trade the shares were marked-up 0.5p to 6.38p.

The voracious appetite for Falkland Islands oil company shares was highlighted in The Mail on Sunday, noting the amount of money riding on the success of the likes of Desire Petroleum (DES) and Falkland Oil & Gas (FOGL). So far, only Desire has contracted a rig, which is being towed to the area and – although not specified in the article – it is implied that the other participants are hopeful of sub-contracting it. Despite all the talk of potential riches, the author advised readers: “If you already hold shares it would probably be best to take the profits after the recent run and before the rig gets there and starts drilling.” Meanwhile, the Sunday Express provided a different cautionary tale, after it was revealed that the Argentine authorities are questioning the UK’s right to have awarded the prospecting contracts, going on to mention Desire in a sub-article. Desire’s shares were off a penny at 119.5p and FOGL’s were down by 2p to 162.5p at the time of writing.

Saturday’s Daily Mail reiterated last week’s trading statement from Judges Scientific (JDG) and the following jump in share price. This remained unchanged at 137.50p during early trading.

Featured in the ‘Ones to Watch’ column of Saturday’s Daily Express, the article on Mariana Resources (MARL) provided both a retrospective, explaining the surge in the stock last October, and a forward look at the Group’s drilling campaign and expected, “positive news from its Don Amigos joint venture with Hochschild.” Despite this coverage, the shares were marginally off this morning at 16.75p-mid.

The ‘Smaller Companies Roundup’ section of the same paper featured news from Optare (OPE), Norcon (NCON), Empyrean Energy (EME) and ReGen Therapeutics (RGT). Empyrean (unchanged at 11.75p) featured due to a drilling update from its Sugarloaf prospect while ReGen (unchanged at 2.25p) was able to report progress in various markets. Optare’s and Norcon’s trading updates (see below) merited attention from other papers as well.

A positive trading update from Norcon (NCON) saw it as the ‘Tiddler To Watch’ in Saturday’s The Times. The shares were up 6p on Friday, after it was announced that management expected a good 2010 and broker FinnCap considered the shares “significantly undervalued.” The momentum continued in Monday’s early trade and the stock was 3.5p better at 75p.

An increase on Friday in the share price of Optare (OPE) was pointed out by the Financial Times at the weekend, following contract news and a £2.2m fundraising. However, the shares were 0.125p weaker at 6.75p earlier today.

Petra Diamonds (PDL) appeared in the weekend’s Financial Times, drawing attention to a line of 20m shares that it stated had been sold by the administrators of Lehman Brothers, having been held as collateral against a loan to Saudi conglomerate Saad. This was also reported by Saturday’s The Times, including comment that Petra has, “sounded out a number of buyers for the other shares held by Saad.” The shares were placed at 42p and the piece highlighted the subsequent fall in the price, though the stock was 0.25p higher at 54.25p this morning.

The sale of its non-core Welsh landfill gas property for £2.75m saw a mention for Renewable Energy Holdings (REH) in The Times on Saturday. Although the cash will be diverted to other core projects, the stock was marked-down after the news, but was unchanged today at 21p-mid.

Expectation of an RNS today confirming further gold finds for Vatukoula Gold Mines (VGM) was reported in The Independent on Sunday. The Company did not disappoint, as can be read in its announcement as linked below. The shares reacted positively today and are now up 0.175p at 2.565p.

Details of the expected reverse-takeover of West African Diamonds (WAD) by African Aura’s (AAAM) Stellar Diamonds subsidiary should be revealed this week, so reported The Sunday Times. A fund-raising of between £4m and £7m, should see a £20m market cap company emerge. WAD shares are currently suspended at 4.13p.

The prices above were taken at around 10:40am on 25 January 2010.

Announcements

The following companies, in which City Equities customers may have an interest, released announcements to the market this morning. These can be found by entering the relevant company name or ticker code in the search box on this site.

Discovery Metals (DME): Notice of General Meeting.

EMED Mining Public Limited (EMED): Result of EGM.

Formation Group (FRM): Directorate Change.

Lupus Capital (LUP): Pre-Close Trading Statement and Confirmation of Directorate Changes.

MBL Group (MUBL): Trading Update.

Provexis (PXS): Holding in Company.

Range Resources (RRL): s708 Notice.

Stanelco (SEO): Stanelco re-brands bioplastics business.

Vatukoula Gold Mines (VGM): Exploration Drilling Results.

Look out for this week

Monday, 25 January – HM Treasury – Global Bank Tax and Obama Reform Plans discussed at G7 Finance Officials London Meeting.

Tuesday, 26 January – GDP Preliminary Estimate (Q4). UK Monthly Service Sector Figures (November).

Wednesday, 27 January – CBI Monthly Distributive Trades Survey (January).

Thursday, 28 January – Nationwide Monthly Housing Review (expected around now – January).

Friday, 29 January – UK Consumer Confidence Survey (January).

Diary items source: Fidessa.

The next Penny Share Review will be posted on Monday, 1 February 2010.

Compiled by Chris Richards / Andrew Thacker




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