Monday proved to be an explosive trading session, despite their OTC issued yield sign, for the junior gold mining penny stock of Sarissa Resources (SRSR). Trading more than 3X their 5-day average, SRSR stock closed just 1/10 of a penny off its HOD. Considering the gold exploration company has yet to book any revenues, the recent joint venture agreement appears to have injected some life into the investor sentiment as the stock has jumped 254% in the last 6 weeks.
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SRSR Stock Chart
Close: 0.05, up 0.011 (28.21%)
Dollar Volume: $326,676
Average Trade Size: 36,788
Issued and Outstanding: 832,077,466
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Three weeks ago, the junior mining company, through their wholly-owned subsidiary Nio-Star Corp., stated that they and another mining group have signed a LOI to form a Joint Venture company in order to finance the advanced exploration of the Company’s Northern Ontario Nemegosenda niobium property. The deal is expected to close near the end of September once the newly formed Joint Venture obtains approval of the appropriate Government Agencies.
The Nemegosenda Property comprises approximately 9,000 acres consisting of 1,800 patented, and an additional 7,200 contiguous acres staked in Northern Ontario. The property consists primarily of two claim groups: the “Rapski Purchase” and the Windsor claims. The patented land, the “Rapski” Purchase, was purchased under option in December 2007 for $380,000 payable over four years and is subject to a 2% Net Smelting Royalty.
The Nemegosenda Property also contains 7 unpatented claims, the “Windsor” claims, which were purchased under option on January 9, 2010 for $90,000 payable over two years and subject to a 2% Net Smelting Royalty. There was an option to purchase 1% of the Net Smelting Royalties for $1,000,000.
One key note Sarissa points out in their most recent financial report is that “Although the Company has taken steps to verify the title to mineral properties in which it has an interest, in accordance with industry standards for the current stage of exploration of such properties, these procedures do not guarantee the Company’s title. Property title may be subject to unregistered prior agreements or transfers and title may be affected by undetected defects.”
About SRSR Stock
Sarissa Resources Inc. is focused on the acquisition, exploration and development of mineral property interests in Canada. The Company is considered to be in the exploration stage and substantially all of the Company’s efforts are devoted to financing and developing these property interests.
There has been no determination whether the Company’s interests in unproven mineral properties contain mineral reserves which are economically recoverable.
Click here to view the most recent filing for SRSR.
Bottom Line: The momentum gaining on this junior mining penny stock, SRSR, has provided a great opportunity for traders to book gains over the last week plus. Can it continue? A year ago, SRSR peaked out at 0.075 allowing for roughly 50% more gains if it was to test that level again. Only 24.7 million more shares are issued since that high but a pull back is likely to come allowing for another momentum build up to the September announcement.
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