Martin Tsvetkov

Mexus Gold US (PINK:MXSG) Enters the Overbought Area

by Martin Tsvetkov November 9, 2012
MXSG_chart.pngWhen investors put their money into revenue-generating businesses, they usually end up getting a decent return on their investments. If the business has yet to become a money-making machine, however, a decision on buying its stock is equal to throwing caution to the winds. Which scenario does Mexus Gold US (PINK:MXSG) pertain to?

To begin with, MXSG is an exploration stage mining company focused on evaluating, acquiring and exploring gold, silver and copper properties in the West. At least, this has been the company's top priority since September, 2009 when it changed its business. Prior to that, the company had already changed course in 2005 after waiting fifteen years to do so. Altogether, MXSG has now officially entered its 23rd year in exploration stage.

Fundamentally speaking, MXSG has a long way to go before turning profitable. Having incurred an average net loss of $1.44 million for the last three fiscal years on record, the company's financial state is unenviable at best. While MXSG's core assets have been evaluated at $1.9 million, their intrinsic value is hard to calculate as they have not produced any material results yet.

Technically speaking, however, MXSG looks like one of the hottest penny stocks of the week. Having registered four positive sessions in a row, MXSG has now landed at a six-month high of $0.57 per share showing no signs of slowing down. Yet, the momentum does seem to be subsiding as the Relative Strength Index has already cracked the 80% level deeming the stock way overbought.

MXSG_logo.jpgInvestors who are willing to jump on the MXSG bandwagon are advised to exercise caution when building up their investment portfolios. The stock is overbought. And overvalued, too. At present, MXSG's current market cap, i.e approx. $108 million, is 54 times higher than the total assets of the company.

Comments 2

1. Guest
November 10, 2012, 12:02PM

Quotes Listed stock reorganization to another purpose NOT 23 yrs exploration! Standard bypass tedious expensive IPO made Action Fashions into Mexus Gold's new purpose as MXSG OTC full reporting SEC. Producing placer gold since Sept '11,adding mill recover hi grade concentrate gold 4th qtr at facility Caborca Mexico.Rrise PPS,volume due assuming 60% of private Trinidad Pacifica mine,large 6 year heap leach mine located NE of Caborca.3rd small heap leach 25mi W facility under new announced Ltr of Agreement to operate majority owner. Sonora's "Golden Triangle" producing 500 yrs since Cortez era. Nearby largest Latin America open pit "La Herradura", Newmont-Penoles adjoins Mexus property. New access road being constructed Mexus property S border. "Look for elephants in elephant country!" A mining maxium. Buy a $2 stock for .57 current seems good deal. Mexus is not producing garbage as product out.

2. Guest
November 09, 2012, 10:20AM

Quotes That is completely in accurate as the company has been producing for at least the last 3 quarters.

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