Hristina Beeva

El Capitan Precious Metals, Inc. (OTCBB:ECPN) Seals Drop with Record Selling

by Hristina Beeva November 22, 2013
The drop for El Capitan Precious Metals, Inc. (OTCBB:ECPN, ECPN message board) became precipitous, marking a three-year record of selling. The recent climbing trend in the stocks could not hold, and net buying is a thing of the past as the share price sank more than 60% in three days. ECPN lost more than 26% on Thursday, sinking to $0.1389 on dollar volumes of above $449,000. ECPN1122.png

What is strange is that ECPN has not been pumped by email since August, but the low prices in the summer caused buying to take off in the past months, sending the shares up to a recent peak at 40 cents. NVGC1122.png

But the last few days show increasing skepticism on investors' forums, noting that ECPN provides very little data on potential production, and on the distribution of metals. One sure way to see if this gold and silver miner is doing something, and not just selling riches in the ground, is to see whether the financials reflect any earnings from those promising mines. ECPN reveals:

  • $245,390 cash
  • $2.27 million total assets, incl. $1.8 million mineral property
  • $161,944 current liabilities
  • No revenues
  • $200 million loss since inception

The company has 259 million shares authorized, and it commanded a higher price in the past, as high as $1.50, which may explain how the operations were financed. Still, the mineral properties are just making losses, all of this happening in a market where gold and silver prices are still extraordinarily high.

ECPN takes the place of another recent mover in the gold industry, Nevada Gold Corp. (OTCBB:NVGC). The ticker had a miFTTN1122.pngnor setback, but continues with a new buying trend. What the two companies have in common is that their mines are still in the initial stages, and both mark only losses, without significant results from their activity.

Underground riches, in that case oil and gas, are the story behind First Titan Ore, Corp. (OTCBB:FTTN). The ticker slid from $2 without further gains, but is now making smalls steps above the dollar level.

Gold and other minerals have been a staple for many OTC companies, as they hold an air of legitimacy, and look like a long-term promise.

For ECPN, for now the game seems to be over, although a lower price may bring back buyers. If you still want to join the possibility, keep in mind that the ticker has shown it can easily go down a third. Avoid any mining sensations unless you can also afford the setback.

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