Todor Pichurov

Energizer Resources Inc. (OTCMKTS:ENZR) Surges on PR

by Todor Pichurov September 15, 2014

Friday brought another red-hot session for Energizer Resources Inc. (OTCMKTS:ENZR, ENZR message board). After jumping 21% the previous day, ENZR closed the week with another big green session. The ticker put on another 41% on volume that swelled further, to over 6 million shares.

So, what exactly prompted people to trade more ENZR shares in two days that they did over the past two full months? Obviously, the excitement was triggered by ENZR's press release dated September 11. The company decided to use the Tesla Motors Inc. (NASDAQ:TSLA) gigafactory as an excuse to stir a bit of excitement around its own stock. TSLA's battery factory, the PR informs, will virtually double the world's consumption of flake graphite and ENZR 'may' just be squatting on 'the 'mother lode'.

The more unpleasant part of the news story is that it was accompanied by a stock pump. The email came through on the day of the PR, Sep 11, and contained the full text of the release, as well as a page from Energizer's website containing information on graphite. The pump's disclaimer stated that Energizer Resources Inc. paid $5,000 for the advertisement to promoter party Information Solutions Group LLC.

The company last reported the following numbers as of March 2014:

  • $5.29 million in cash
  • $2.18 million in total liabilities
  • zero revenues since inception
  • $4.2 million in Q3 net loss

With the company's fiscal year ending in June, the next report will be an annual arriving by the end of this month. On the upside, the PR concerning the company's Molo deposit in Madagascar – ENZR's biggest bet for supplying the world with flake graphite – states that the Molo is a NI 43-101 resource. Having the National Instrument signage is a comfort, as the document serves to prevent the dissemination of 'misleading, erroneous or fraudulent' info.

The previous time the share price spiked so dramatically was back in the summer of 2013, when another hugely optimistic PR concerning the Molo deposit and the purity of extracted material was published. The aftermath of that spike was a tumble from $0.279 to $0.12 within three months. How well ENZR performs in the wake of this latest spike remains to be seen.

Comments 1

1. Guest
September 15, 2014, 10:46PM

Quotes Nicely-written piece. Thank you for a good read, usefully informative.

Type the characters that you see in the box (5 characters).