According to experts, coal prices have been historically more stable and lower than those of oil and gas.
They say also that coal remains for decades now among the most affordable fuels for power generation in many developing and industrialized countries.
It looks like these days, when oil prices are insanely galloping up, rolling down coal indexes suggest alternative investment opportunities.
Maybe some investors will soon get sight of America West Resources, Inc. (OTC:AWSR, AWSR message board) stock for some additional to the above mentioned reasons.
One reason is the low share price, the other is the opportunity to get the promotional train of AWSR and to make a short-term trip. As the chart here shows, this trip may bring profit to investors, though it is a dangerous and risky one.
Unfortunately, the shares of America West Resources, Inc. are not the best example for the above mentioned alternative investments. One of the reasons is that while coal prices were in an almost constant uptrend for a year, the price of the company's stock experienced some difficulties to follow the up move of the coal indexes. Maybe to avoid the absence of correlation, from the end of last December and up to the end of this March the shares of America West Resources, Inc. were in a continuous promotion.
After one month of "deserved rest" resulting in a share price decline, the company's stock is again in motion pushed by a paid promotion.
This Wednesday, one day before the start of the new investor awareness campaign, AWSR closed the market at $0.90 per share. Still, there were bids higher than the 52-week low of 25 pennies.
Yesterday, the train of the stock promotion took the first dangerous turn and the price of AWSR climbed up by 11.11% between the sessions.
Though, thanks to the stock promotion the shares of America West Resources, Inc. may jump beyond the trading range of the classical penny stock, although it is hard to predict for how long. At the beginning of the previous promotional campaign, AWSR was tree times more expensive than yesterday.
In those days, AWSR was flying up not only supported by a promotion. Coal prices also noted new highs. Now, the "background" is different. This month, coal prices pull back. In addition, a few weeks ago America West Resources, Inc. announced its annual report or the fiscal year ended December 31, 2010. It may bring investors some optimism, but also raise questions related mainly to the company's debt and liquidity matters.
The statement of the company's management that there can be no assurance that AWSR will have a gain from operations or net income in fiscal 2011 or thereafter presents the other side of the $1 worth stock. AWSR reported also coal sales of approximately $10 million, net loss of approximately $16.1 million and a working capital deficit of approximately $30 million.
The agreeable news was that the company reported approximately 12 million tons of remaining proven reserves of recoverable coal at its Horizon Mine, which are anticipated to take more than 30 years to mine at the current production rate. AWSR reported also the initiated aggressive expansion program at the Horizon mine.