Gediminas Jasionis

Chartwell International, Inc. (OTCBB: CWLT) - Yet Another Company To Keep Away From

by Gediminas Jasionis September 25, 2009
It's quite sc2logo.jpgary to look at the stock chart of Chartwell International, Inc. (OTCBB: CWLT or CWLT.OB). The downtrend can be seen only when you zoom out, because hardly any intraday trades occur with their shares. Apart from being a highly illiquid penny stock, the company is also not doing well in their business.

I'm not sure what the company is trying to achieve with their current plans, but whatever it is, it is not working. The most recent financial data available for investors to view is six months old. And those numbers alone suggest that Chartwell's business is quite an expensive one. The cash burn rate is astounding and operations result in nothing other than an increase in debt.

Despite having the rights to land, which theoretically contains valuable minerals, the company has yet to come up with a specific plan for the use of that land. As mining is a capital intensive business, the company would need to raise cash before jumping into that. The sale of their railroad business back in January 2009 didn't do much so far, as the elimination of debt took its toll on the cash raised from the sale. Other means of financing just doesn't seem available, with such a low priced stock and money losing operations.

There are no updates on Chartwell leasing or selling the owned land with its mineral resources, so the business looks like it's stuck. That is why investors stay away from the stock, and those still trading it simply have a very high risk tolerance.

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