Hey Lou!
I have watched a little company named Quattro Exploration for a number of years now.
Do its financials point in a positive direction? I am wondering if this penny stock might have upside when oil becomes attractively priced again.
Rob
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Hey Rob,
Thanks for the assignment. Quattro Exploration And Production Ltd. (QXP TSXV) has a market capitalization of $8.75 million and the average daily volume over the last three months has been 34,810 shares. These factors demand that you view QXP as a potential addition to the speculative section of your portfolio.
I won't be commenting on the fundamental aspects of the stock as I don't believe that even spectacular performance can overcome the huge negative related to oil prices. This week, BP Amoco Plc. announced that they expected oil to hit $60.00 per barrel in 2017. Clearly that's better than the current price, but it looks like a long dry trail to 2017.
An audit of the charts will identify how best to proceed with this stock.
Desktop users click on image to enlarge
The three-year exhibits a long and painful decline that started in April of 2014 when the shares topped out near $0.95. In early May of 2014 the stock breached the uptrend line that started in January when the stock broke above $0.15. The decline continued as QXP broke below the 50-day moving average in August and the 200-day moving average in October. The death cross that formed in November when the stock was trading near $0.45 put another caution flag on the track.
Desktop users click on image to enlarge
The six-month chart provides a close-up of the choppy trading you can expect from QXP. What is observable is that there have been days when the shares don't trade at all which points to a liquidity issue that needs to be part of your evaluative process. Also worth mentioning is the resistance along the 200-day moving average that put a stop to the lift that started in September.
I would advise that you approach QXP with caution. It may increase production but there is no guarantee that it will be rewarded in today's environment.
Next time I will re-examine the charts for Russel Metals Inc. (RUS TSX) for Glenn.
Make it a profitable day and happy capitalism!