Earlier in February, Diamante Minerals Inc (OTCBB:DIMN) posted a 52-week low of $0.90 per share. However, it reversed its momentum and from thereon has been consistently moving high on the charts. The red sessions have been almost missing in the past two months. DIMN has been an illiquid stock with some surge of interest lately. In last trading session, the stock price consolidated after posting strong gains in past few days. The stock declined 0.45% to close at $2.22 on a share volume of 118,829.
The growing interest
It is clear that traders and investors are not too concerned about the mounting price of Diamante stock and the surging volumes imply that the interest is growing. The only problem is that the rise in volume and prices is not backed by strong reasons. The last press release was released four and a half month back. Moreover, there are no pumps or filings that can fetch the interest of investors.
Inadequate funds
Here, it is essential to understand what is the reason behind the growing interest in the company’s stock? Most of the people are hoping for a successful joint venture deal to finalize in the coming days. The deal was announced back in November. Diamante would require capital of $1 million to materialize the joint venture. However, the company doesn’t have enough funds to support the deal, which is evident from the latest financial report.
The number game
As per the last financial result, Diamante Minerals reported cash balance of $800,000. It is clearly far less than the amount that is required to close the joint venture. The current assets came at $801,000 while $132,000 was the current liabilities. The revenue has been zero since inception and the quarterly net loss amounted to $193,000 in last report. Considering the numbers, people should jump before investing into the stock.
